The scale of Taiwan’s cross-border EC market is large compared to other countries, and it is said to be one of the countries that will achieve further growth in the future.
In addition, since high-quality products made in Japan are in constant demand overseas, the company can expect to increase its profits if it can effectively market its products to Taiwan, which is located close to Japan in terms of land distance.
In this issue, we will introduce the scale of Taiwan’s cross-border EC market and the characteristics of Taiwan’s EC market behind its development.
About Taiwan’s EC Market
The following is an explanation of the EC market in Taiwan, its scale, and the advantages and disadvantages of starting cross-border EC for Taiwan, in the following order.
- What is the size of Taiwan’s EC market?
- What are the advantages of starting cross-border EC for Taiwan?
- What are the disadvantages of starting cross-border EC for Taiwan?
Let’s take a closer look.
What is the size of Taiwan’s EC market?
According to a 2017 survey by the Ministry of Economy, Trade and Industry, Taiwan’s EC market size was approximately 2,506.1 billion yen.
Among these, the cross-border EC market is estimated to be worth approximately 130 billion yen.
The EC rate in Japan is 7.9 %ですが、台湾のEC化率は10.4%, boasting a relatively high figure. In addition, China, where EC is thriving, has an EC rate of 20.4 %、アメリカでは11.8%.
In Taiwan, the most e-commerce sector is “audio/visual home appliances,” followed by “apparel” and “cosmetics.
If you are interested in promoting cross-border EC, it is a good idea to look at products that are attracting particular attention in the countries you have selected as your target.
In addition, the number of cross-border EC users accounts for 16.0% of the total number of EC users in Taiwan, a figure that is higher than in other countries.
Incidentally, the same item %を占めていて、アメリカでは6.0% for 19.9 in Japan %を占めていて、アメリカでは6.0%.
Therefore, further expansion of cross-border EC to Taiwan, which is considered a country with a large number of users, may lead to further corporate development.
What are the advantages of starting cross-border EC for Taiwan?
The presence of many pro-Japan people in Taiwan is one major factor, and products made in Japan are also highly valued.
In recent years, the development of smartphones and other gadget devices has occurred and the Internet infrastructure has been developed, resulting in an increase in the number of online shoppers.
Another advantage is that Japan and Taiwan are very close to each other, and delivery does not take very long, so costs can be reduced compared to delivering packages to distant countries.
What are the disadvantages of starting cross-border EC for Taiwan?
In Taiwan, some goods are subject to higher tariffs than others.
To give a specific example, sake (grain liquor) is subject to a tariff of 20 %の関税、砂糖菓子には20〜27.5% subject to a tariff of %の関税、砂糖菓子には20〜27.5%.
Incidentally, the tariff rate on sake was reduced from 40 to %から20% in 2019, but even at 20% the tax rate remains high.
What happens when the tax rate is high?
Since customs duties are essentially paid by the recipient, the higher the amount, the greater the financial burden on the consumer.
The higher tariffs will result in less support for the company if it does not sell value-added products.
Five characteristics of Taiwan’s EC market.
In this section, we will focus on the following five characteristics behind the development of the EC market in Taiwan.
- Infrastructure Market Matters
- Convenience store pickup
- Matters related to malls
- Matters related to pro-Japanese groups
- Lifestyle issues in Taiwan
Let us begin with a brief explanation below.
Infrastructure Market Matters
In Taiwan, as in Japan, the Internet infrastructure is quite advanced.
For this reason, free Wi-Fi is often available in public places and tourist attractions.
From a logistics standpoint, the small size of the country itself has something to do with the fact that the fastest delivery to the same city takes only about three hours.
Not limited to cross-border EC, various Japanese logistics companies are entering Taiwanese commerce, etc.
Payment methods are also diversified, with cash on delivery (COD) and payment at convenience stores in particular being frequently used.
Convenience store pickup
Although Taiwan does not have a large population, nor does the country cover a large area, there are many convenience stores.
Convenience stores are very convenient and frequently used by Taiwanese residents.
Since there are many working couples in Taiwan, convenience store pickup is especially preferred, as it allows them to stop by immediately after shopping at EC in their spare time.
Matters related to malls
As mentioned above, Taiwan has a large number of EC users, and EC malls are said to be one of the most frequently used.
Particularly well-known malls include “momo.com” and “PChome,” while “Yahoo Chiima Shopping Center” and “Rakuten Ichiba,” which are also frequently used in Japan, are also frequently used in Taiwan.
Matters related to pro-Japanese groups
According to a 2017 Japan National Tourism Organization (JNTO) survey report, 4.56 million Taiwanese visited Japan that year, with a total of 4.36 million visiting for tourism purposes.
This number is worthy of third place in the ranking by country regarding foreigners visiting Japan. Incidentally, China and South Korea are No. 1 and No. 2, respectively.
In addition, it was expected that the number of foreign visitors to Japan would increase due to the 2020 Tokyo Olympics and Paralympics, but due to restrictions on entry into various countries due to the spread of the new coronavirus, the numbers did not reach the expected level.
However, more and more people are utilizing online shopping due to stay-home influence, and it is no longer unusual for foreigners who have used and liked Japanese products to make repeat purchases of the same products.
Lifestyle issues in Taiwan
In Taiwan, as in Japan, the phenomenon of “late marriages” has been progressing. As mentioned earlier, many couples are working together, and many of them are financially able to afford to do so.
Since prices are lower than in Japan, there is no great resistance to buying products, and the purchasing rate seems to be high in Taiwan.
Develop cross-border EC by targeting Taiwan!
According to a 2017 survey by the Shissohui產業情報研究所 (MIC), roughly 40% of Taiwanese consumers purchase goods on foreign websites.
Many companies are trying to improve their sales even more than they are now, as inbound consumption in Japan has declined due to the modern era, in part due to the new coronavirus.
In such a situation, it is not surprising that companies begin to look at overseas expansion as a way to develop their business.
Cross-border e-commerce offers the potential for people from all countries to become customers, but of course there are barriers such as language and laws.
Therefore, it is one effective way to start cross-border EC in the Taiwanese market, where infrastructure is well-developed, economic growth is expected, and countries are close to each other.
Consumers living in Taiwan, as in Japan, mostly get information about products through SNS.
Basically, Taiwanese people tend to prefer products that are of high quality and can be used for a long period of time, so products made in Japan are in demand.
Although restrictions on imports from certain regions are still in place after the Great East Japan Earthquake caused problems related to radiation, Japanese products are still well-liked and used by the Taiwanese people.
In recent years, frozen foods made in Japan have also received high praise as delicious, hassle-free products.
It is a good idea to keep track of trends among Taiwanese consumers on social networking sites and research what they tend to like.
Furthermore, Taiwan faces almost the same social problems as Japan in terms of low birthrate, aging population, and high rate of unmarriage.
The fact that we have so much in common in terms of social issues means that we may be able to take advantage of the marketing techniques we are using in Japan.
This is because each country has its own unique marketing approach, which is perfected by taking into account what social problems currently exist in that country and what kind of products and services the people are seeking as a result of those social problems.
If you look not only at information related to business, but also at the social situation in the country, you will probably make new discoveries.
Customs Procedures and Business Taxes
One consideration to take into account if you want to sell your products abroad is the customs procedure.
When shipping goods to people living in Taiwan, the goods must be properly declared for export and undergo screening and inspection. Once export permission is granted from the Taiwanese side, the goods can begin to be shipped out without incident.
The goods are then transported to a bonded area in Taiwan, where they wait for the procedure to be fully completed.
Since customs procedures are often complex, it is a good idea to accumulate knowledge about the procedures in advance and confirm in advance what application documents, permits, and other items are required for customs procedures.
In this issue, we have introduced the scale of Taiwan’s cross-border EC market and the characteristics of Taiwan’s EC market behind its development.
Not limited to Taiwan, sales of products to overseas markets through cross-border EC will certainly lead to corporate development.
Although legal and language barriers exist, cross-border EC is a very attractive market with all kinds of growth potential.
If you want to promote cross-border EC, it is recommended to find and use a platform that can be easily operated and that can also be linked to SNS to reliably attract customers.