As a lot of retails sales is moving from offline to online, also for France your path to market entry may involve a webshop or other online sales platform. But how to start and what choices to make?
France is a interesting market
We think France is an interesting market for selling your retail products for several reasons:
- Large population: France has a population of over 67 million people, making it one of the largest markets in Europe.
- High internet penetration: Over 90% of the French population has access to the internet, making it a tech-savvy market for online sales.
- Strong e-commerce growth: The e-commerce market in France has been growing steadily over the years and is expected to continue to do so in the future, providing ample opportunities for businesses to sell their products online.
- Cultural affinity for online shopping: French consumers are known to be avid online shoppers, with a growing number of them opting to purchase products online instead of visiting physical stores.
- Strategic location: France is located in the heart of Europe, making it an ideal gateway to other European markets for businesses looking to expand their reach.
But there are more companies who think the same. We see that after Germany, the UK and France are the most targeted countries for new brands. This means that France can also be a very competitive market.
Two ways of selling your products online
In general, there are two ways if you want to sell your products online in this market:
- Through an open platform like Amazon, Cdiscount or La Redoute where you can set up your own shop
- Through a (specialized) online distributor, who will buy your products and sell them on its website.
Selling on a platform like Amazon involves listing your products on that marketplace, which allows you to reach a large number of potential customers who are already shopping on the platform. As a seller on Amazon or other platforms, you are responsible for managing your inventory, shipping products to customers, and providing customer service. The platform charges fees for its services, including a referral fee and a fulfillment fee if you choose to use the platform’s fulfillment services.
On the other hand, selling through an online distributor involves partnering with a company that specializes in distributing products to retailers or other sellers. The distributor will take care of the logistics of getting your products to retailers or other customers, such as warehousing, shipping, and handling returns. In exchange for their services, distributors typically charge a fee or take a percentage of the sales.
Benefits and fees of open platforms
There are several popular e-commerce platforms in Germany where businesses can sell their products as professional users. Here are some of the main platforms and their reach:
- Amazon.fr – https://www.amazon.fr/. They reach over 43 million monthly active users in France (source: Statista)
- Cdiscount – https://www.cdiscount.com/. They reach over 18 million monthly active users in France (source: SimilarWeb) with a turnover of €3.7 billion in 2020 (source: Les Echos)
- eBay.fr – https://www.ebay.fr/. They reach over 12 million monthly active users in France (source: SimilarWeb)
- Rakuten.fr : https://fr.shopping.rakuten.com/ They reach over 4 million monthly active users in France (source: SimilarWeb)
- La Redoute: https://www.laredoute.fr/ They reach over 3 million monthly active users in France (source: SimilarWeb)
The fees that businesses pay to sell on each of these e-commerce platforms in France can vary depending on several factors, such as the product category, sales volume, and pricing strategy.
- Amazon charges a referral fee on each item sold, which ranges from 6% to 45% depending on the category of the product. For example, the referral fee for consumer electronics is 7% for items priced up to €100, and 12% for items priced above €100. If you are a professional seller on Amazon, you will also need to pay a monthly subscription fee of €39. For individual sellers, there is no monthly fee. If you use Amazon’s fulfillment services, such as FBA (Fulfillment by Amazon), there will be additional fees for storage, picking, packing, and shipping your products.
- Cdiscount charges a commission fee on each sale, which varies depending on the category of the product and the price range from 7 up to 20%. For example, the commission fee for home appliances is 7.5% for items priced up to €500, and 5.5% for items priced above €500. Apart from this you will need to pay a monthly subscription fee of €39,99.
- eBay charges two main types of selling fees: an insertion fee when you create a listing, and a final value fee when your item sells. If you have an eBay store you get 250 listings per month for free. Store subscription fees can be as low as $4,95 per month. The percentage of the final fee varies depending on the category of the product and the selling format. For example, the final value fee for fashion items sold through a fixed-price listing is 10% for items priced up to €300, and 5% for items priced above €300. You can also choose to promote your listings on eBay by paying an additional fee based on a percentage of the sale price.
- Rakuten charges a commission fee on each sale, which varies depending on the category of the product and the price range. For example, the commission fee for books is 5% for items priced up to €20, and 12% for items priced above €20. If you are a professional seller on Rakuten, you will need to pay a monthly subscription fee of €49. For individual sellers, there is no monthly fee.
If you want to promote a specific items, this comes at additional cost. And you will always need to cover the shipping costs for your products, and most platforms offer discounted rates through their partner carriers.
There are numerous online distributors in France that sell multiple brands and could possibly also include your products. This is a selection of the bigger websites:
- https://www.veepee.fr/ sells fashion, home decor, travel, and more. They reach over 6 million monthly active users in France (source: SimilarWeb) with a turnover of €3.7 billion in 2020 (source: Les Echos)
- https://www.showroomprive.com/ sells ashion, home decor, beauty and personal care, and more – They reach over 3 million monthly active users in France (source: SimilarWeb) with a turnover of €708 million in 2020 (source: Capital).
- https://www.zalando.fr/ focuses on fashion and accessories – Although active in multiple European countries, they reach over 15 million monthly active users in France (source: SimilarWeb) – Last known turnover in France: €2.2 billion in 2020 (source: Les Echos).
- https://www.asos.fr/ sells fashion and accessories – They reach over 5 million monthly active users in France (source: SimilarWeb) – Last known turnover in France: €444 million in 2020 (source: Les Echos).
- https://www.rueducommerce.fr/ focuses on electronics, appliances, home and garden, fashion, and more. Their reach is over 3 million monthly active users in France (source: SimilarWeb) with a last known turnover in France was €470 million in 2020 (source: Les Echos).
- https://www.manomano.fr/ has the focus on home and garden products, such as tools, hardware, and building materials, with a reach of over 6 million monthly active users in France (source: SimilarWeb). Their last known turnover in France was €2.3 billion in 2020 (source: Les Echos).
- https://www.darty.com/ is known for its electronics, appliances, home automation and related services. They reach over 5 million monthly active users in France (source: SimilarWeb) with a last known turnover in France of €3.9 billion in 2020 (source: Statista).
- https://www.boulanger.com/ also focuses on electronics, appliances, home automation, and related services. They have over 2 million monthly active users in France (source: SimilarWeb) with a last known turnover in France of €3.6 billion in 2020 (source: Statista).
Being online does not guarantee sales
While having an online presence can provide businesses with many benefits, such as increased visibility, the ability to reach new audiences, and cost savings, it does not guarantee sales. There are several reasons why being online does not guarantee sales:
- Competition: The online marketplace is highly competitive, and businesses need to differentiate themselves from their competitors to stand out. This can be challenging, particularly in crowded marketplaces.
- Marketing: Just having a website or online store is not enough to drive sales. Businesses need to invest in marketing and advertising to reach potential customers and drive traffic to their website.
- Trust: Building trust with customers is critical for online sales. Customers need to feel confident that they are purchasing from a reputable and trustworthy business. This can be particularly challenging for new or lesser-known businesses.
- Logistics: Fulfillment, shipping, and returns are critical components of the online shopping experience. If a business does not have a reliable and efficient process for these tasks, it can negatively impact the customer experience and sales.
Especially when introducing a product to a market marketing is needed. On open platforms like Amazon or Rakuten you can advertise or push your products, and invest in it directly. In our experience, in the beginning these marketing expenses may easily outweigh the revenue. Only when customers are returning the margins are moving to positive.
When working with an online distributor, that company may either ask for a low sales price, or for your involvement in the marketing. Having your social media accounts up and running, co-financing advertisement or doing (sampling) events can be important requirements to displaying your products.
The best strategy for selecting an open platform
From our experience, if you want to select an open platform in France for selling your products, we recommend to keep the following in mind:
- Consider the product category: Different platforms may specialize in different product categories, so it’s important to choose a platform that aligns with your product offerings. For example, if you sell fashion products, Zalando or Asos may be a better fit than Amazon or eBay.
- Consider the ease of working with the platform. We see big differences in the user interface of the back end, where you need to upload your product descriptions and in connecting it with your bookkeeping and stock management system.
- Analyze the target audience: Different platforms may have different customer demographics and purchasing behaviors, so it’s important to choose a platform that aligns with your target audience. For example, if you sell high-end luxury products, Amazon or eBay may not be the best fit as they are more known for low-priced products.
- Evaluate the fees: Each platform has its own fee structure, so it’s important to evaluate the fees and determine which platform offers the most cost-effective solution for your business.
- Review the competition: It’s important to review the competition on each platform and determine whether your products can stand out and compete effectively against similar offerings.
- Assess the platform’s support and resources: Different platforms offer different levels of support and resources for businesses. It’s important to choose a platform that offers the necessary tools and resources to help your business succeed.
- Consider the platform’s reputation: The reputation of the platform can impact customer trust and willingness to purchase. It’s important to choose a platform that has a good reputation and is trusted by customers.
If you have the time and money for it, it may also be beneficial to test multiple platforms to determine which one offers the most effective solution for your business.
The best strategy work with an online distributor
Getting your products listed with an online distributor requires a well-planned strategy to increase your chances of success. We advise to do the following:
- Conduct research to find the best fitting online distributor for your products. Consider factors such as the distributor’s target audience, product category, and pricing.
- Ensure your products meet the distributor’s requirements: Each distributor has specific requirements for the products they list on their platform. Ensure that your products meet the distributor’s requirements in terms of quality, safety, and packaging.
- Decide what product you want to replace. Even an online distributor can only show and keep in stock a limited number of items. If you want to be one of the top items to be displayed, what other brand or product should go down? And how would the website make more money from your product?
- Price your products competitively: Set competitive prices for your products to attract customers and increase your chances of making sales. Consider the prices of similar products on the distributor’s platform and adjust your prices accordingly.
- Promote your products: To increase the visibility of your products, consider promoting them through online advertising, social media, and other marketing channels. This can help attract more customers and increase sales. If you are willing to refer to the online distributor’s website, this may be an argument for him to list your products.
The process is not so different from getting your products listed with an offline distributor. The main advantage for online is that you can occupy places in the ‘long tail’, products that in one city are not enough in demand to have them in a shop, but overall in a country have enough demand to offer them online. If you then help with the promotion and in the beginning offer to put part of your stock in consignment with the distributor, chances are higher to get listed.