The current market conditions in Australia have made it tricky for many in the retail sector to find fresh growth. This is reflected in the local retail industry turnover rate, which fell by 0.4 per cent in March, according to data from the Australian Bureau of Statistics (ABS).

“Consumers pulled back on retail spending in March as cost of living pressures remained high,” said ABS head of retail statistics Ben Dorber in late April. “Underlying retail turnover has been flat for the past six months and was up only 0.8 per cent compared to March 2023.

“Outside of the pandemic period and introduction of the GST, this is the weakest growth on record when comparing turnover to the same time in the previous year,” he added.

However, Australian retailers are a savvy and resilient lot, and many of them are finding new and novel ways to tap growth, even as local consumers pinch their pennies. Operational efficiencies are front of mind, as is customer retention. Customer acquisition in new markets is also in play.

On that front, retailers are increasingly looking beyond the local market and are pursuing international audiences. Once upon a time, leapfrogging national borders to make a splash in a foreign market was a big deal, laden with huge upfront costs. But this is changing.

Tools to tackle international trade

As the technology and processes underpinning the retail sector have evolved and marched on, so too have the tools retailers have at their fingertips to enable an overseas expansion at a fraction of the cost and time it used to take.

This is something that Shaun Broughton, APJ managing director for ecommerce company Shopify, has seen first hand. A growing number of local retailers are tapping his company’s platform to launch their brands in places like North America and Europe, which offer a wealth of new customers.

“It’s always interesting to see how far our merchants can reach — in last year’s Black Friday Cyber Monday sales period alone, we spotted a Melbourne merchant selling to a customer in Spain, a distance over 18,000km,” said Broughton.

Close to one-fifth of Australian retailers are expanding into new markets to drive growth, and one in seven are investing in launching an international store in the coming year, according to findings from the Shopify Australian Retail Report 2023. But there are a lot of complexities that come with growing internationally, and potentially costly missteps that can stunt growth.

It’s true that trading in markets overseas still comes with additional considerations such as red tape, regulation, local employment laws, currency fluctuations and cultural nuances, to name a few. However, the raft of emerging solutions, many of them tech-based, that retailers have at their disposal now can streamline the processes needed to overcome potential barriers to entry.

Setting up shop from afar

Sometimes an online store by itself is enough to mount an international expansion. Instead, an operational beachhead is needed to establish a presence, especially if physical storefronts are part of the expansion strategy. Even hiring and retaining permanent staff in other countries has become a much easier task than it once was, thanks to a new generation of tools on offer.

“Speed to hire, cost and administrative burdens are significant challenges for fast-growing companies. This includes the time taken to set up a legal entity, learn and understand the nuances of local employment law and comply with local tax regulations for every new expansion market,” said Shannon Karaka, ANZ country leader of all-in-one global people platform Deel.

The time to complete these tasks can stretch out to months, delaying hiring and growth plans, according to Karaka. However, more and more Australian companies are making use of global employers of record providers like Deel, which can handle the human resources elements of onboarding and paying staff across borders, to supercharge their international expansion efforts.

Solving cross-border conundrums

But getting boots on the ground overseas quickly is just one part of building a brand internationally. Keeping customers happy is essential to lasting success. And that means top-notch customer services, something that can be difficult to provide from afar. Fortunately, technology is providing solutions.

“Chatbots and voicebots are great tools for ecommerce retailers that facilitate international transactions,” said Shaun Cochrane, ANZ industry lead at AI-powered experience orchestration platform Genesys. “The technology offers customers tailored, around-the-clock support across multiple digital channels. Chatbots and voicebots can answer customer queries no matter the time zone or language.”

For Cochrane, such technology quickly and easily answers the speed and convenience for which today’s shoppers have such an appetite. But customer-facing operations are just one part of the puzzle when it comes to international retail expansion. Managing cross-border finances, inventory, supply chains and general business operations presents its own host of challenges.

From the perspective of Scott Wiltshire, ANZ vice president and general manager of enterprise resource planning (ERP) platform provider Oracle NetSuite, the automation built into such cross-border backend business systems can make a substantial difference.

“As retailers begin establishing financial, operational and logistics processes for their expansion, automating parts of the business for greater efficiency and accuracy becomes important,” Wiltshire said. “Investing in a quality enterprise resource planning (ERP) system enables retailers to consolidate systems, centralise data in the cloud and introduce more automation to business processes.

“Such an approach improves the speed and accuracy of business insights and accelerates financial reporting so employees can spend less time gathering data and more time driving the business forward,” he added.

Many countries, one view

This is important. When retailers extend themselves to other markets, keeping things cohesive and maintaining visibility across the entire organisation is essential. Australian eyewear brand Bailey Nelson knows this all too well, with the company initially finding it challenging to manage its global expansion, as each new country came with a different general ledger system.

But by tapping NetSuite, Bailey Nelson gained full visibility over inventory, supply chain and financial processes with a single platform. The brand has since grown to 70 stores across Australia, New Zealand, Canada and the United Kingdom.

“For many businesses in Australia and New Zealand, expansion into bigger overseas markets is an important step in their growth journey. But entry into new markets comes with many challenges,” Wiltshire said. “However, by consolidating on an integrated global system, applying automation and streamlining processes, these challenges can be overcome, paving the way for the benefits of expansion to emerge.”

Leon Spencer is chief storyteller at Archetype.