As a German online retailer, selling goods to Switzerland can be worthwhile. The high purchasing power of the Swiss population and the geographical proximity to Germany are probably the most important arguments for this. However, there are also some problems that can arise when selling and especially shipping.
Current statistics on e-commerce in Switzerland, details on shipping, customs and buyer protection can be found in the following article. Also included: The top 5 top-selling online stores with a merchant program in Switzerland!
Why selling to Switzerland can be worthwhile
E-commerce has developed extremely positively in recent years. In 2019, e-commerce turnover in Switzerland rose by 8.4 % to 10.2 billion Swiss francs.
As a result of the measures taken in connection with the coronavirus pandemic, online retail could continue to grow worldwide in the long term. It can be assumed that people who previously never or rarely shopped online will continue to order goods online even after the quarantine measures have ended.
In fact, experts expect e-commerce to have generated around 50 % more sales in 2020 than in 2019. The home electronics, fashion and sports categories in particular have recently recorded above-average growth.
In addition, the trend towards direct sales has now also arrived in Switzerland. According to a Credit Suisse Retail Outlook survey, around 60 % of Swiss manufacturers are already using this option. In this way, retailers from Germany can also sell their goods directly in Switzerland without going through retailers.
After all, the purchasing power of the Swiss population is significantly higher than that of the Germans. While this is €40,500 in Switzerland, it is only €23,000 in Germany. Retailers can take advantage of this by targeting customers from Switzerland who are looking for cheaper products abroad.
These factors indicate that the time is right to enter the Swiss online retail market.
Attention: These problems need to be overcome
As Switzerland is not a member of the EU, there are a few hurdles to overcome when shipping there and even when designing the website. I would like to go into these important details below.
Switzerland's peculiarity of determining customs duties by weight rather than value can lead to problems. For example, the margins for products that weigh a lot but do not have a high sales value can shrink significantly due to the customs duties incurred. In addition, the weight is determined together with the packaging and filling material.
It is possible not to bear the costs yourself. In this case, the customer must pay customs duty and VAT upon receipt of the goods. However, it is generally recommended that the seller assumes this responsibility.
In addition to customs, shipping to Switzerland is not quite as easy as you might think. This is due to the mail order regulation introduced on January 1, 2019, which obliges foreign retailers to register with the Federal Tax Administration for the purpose of settling VAT. Fortunately, this only applies to retailers who have an annual turnover of more than CHF 100.00 with small consignments worth up to CHF 65.
The issue of returns must also be taken into account. Similar to German customers, Swiss customers also return a not insignificant number of products to the seller, especially in sectors such as the fashion industry. This must be taken into account to the extent that all customers should have a return address in Switzerland.
A fulfillment service provider that focuses on shipping between Germany and Switzerland can help with the implementation of shipping to Switzerland and possible returns. The MS Direct AG offers shipping within 48 hours from Hamburg to the end customer in Switzerland, but also takes on tasks such as the storage and reprocessing of returns.
During the Buyer protection in Switzerland is not necessarily as strong as that in Germany, retailers should nevertheless comply with the regulations in Switzerland.
Here are the most important points at a glance:
- The Swiss customer has no right of return in online trading, unless this is defined in the purchase contract. While members of the Swiss mail order business (SAAM) grant a 14-day period, retailers who are not part of the SAAM do not have to grant the customer a right of withdrawal.
- There are no statutory delivery periods. However, if the retailer specifies such a deadline, they must adhere to it.
- The online store must make data visible in accordance with Art. 3 para. 1 lit. s UWG. This includes information on identity, address and e-mail. In addition, the customer must be informed about the steps leading to the conclusion of the contract and technical means must be made available to identify and correct incorrect data during the ordering process. Finally, the order must be confirmed immediately by electronic means.
The top 5 e-commerce platforms with a merchant program
In Switzerland, in addition to the well-known German brands Zalando, Amazon and Aliexpress, there are also the local stores Digitec and Galaxus, which also offer exciting affiliate programs. Here is an overview of the five top-selling stores with a merchant program:
Zalando.ch (CHF 920 million in sales in 2019)
In recent years, Zalando.ch has become the e-commerce marketplace with the highest turnover in Switzerland, although the product range is still quite limited. The main categories currently include shoes, clothing, sport, accessories and beauty.
In addition to Switzerland, Zalando is also active in numerous other European countries and has around 35 million customers. More than 450 different brands have already joined the Zalando partner program, including Adidas, Under Armour and Bershka. Zalando gives retailers control over pricing, product range and product presentation.
Digitec.ch (CHF 820 million sales in 2019)
The online retailer, which is completely unknown in Germany, was the e-commerce platform with the highest turnover in Switzerland for a long time. However, Zalando.ch took over the top position in 2018. However, Digitec Galaxus AG, with its two marketplaces Digitec.ch and Galaxus.ch, continues to generate higher sales than Zalando in Switzerland.
The Digitec.ch and Galaxus.ch retailer program allows retailers to sell products under their own name. Electronics, software and household products are particularly suited to the online store. Those who participate in the dealer program have Digitec Galaxus administer all orders and accept payments, but act directly as the seller to the customer.
One of the biggest advantages of this program is the enormous reach of the two websites digitec.ch and galaxus.ch. With a total of around 15 million visits per month, this platform offers sellers from Germany a suitable opportunity to enter the Swiss market.
Amazon.de (CHF 700 million in sales in 2019)
Amazon has so far refrained from giving Swiss customers their own online presence. As a result, goods are often ordered via Amazon.de, but also via Amazon in France or Italy. However, due to the hurdles mentioned above, such as customs or shipping costs, this is by no means worthwhile for all products - especially if they can also be ordered via Swiss online stores.
For this reason, most products are not delivered to Switzerland in the first place. However, if you still want to serve the Swiss market via Amazon.de, the best way to tackle this task is to work with a logistics service provider from Switzerland.
Aliexpress.com (CHF 500 million sales in 2019)
The online store of Chinese e-commerce giant Alibaba has also developed magnificently in Switzerland in recent years. Even if its popularity has suffered since the Covid crisis, it is still a platform that sellers should not ignore. Although most sellers come from Asia, it is also open to retailers from Germany.
The platform scores points with free account creation, a low commission and a proven shipping concept. A personal store can also be created. Thanks to its international availability (more than 220 available regions and 18 localized versions of the website), Aliexpress is particularly interesting for merchants who not only want to sell products in Switzerland, but also pursue a truly international approach.
Galaxus.ch (CHF 262 million in sales in 2019)
Galaxus describes itself as the "largest online department store in Switzerland". As a brand of Digitec Galaxus AG, the online store is comparable to the Digitec store listed above. However, the product range not only primarily includes technology, but also household appliances and utensils. Galaxus also sells other products such as jewelry, fashion and toys.
The retailer program is the same program that gives retailers access to the Digitec store. The advantages, including in particular the high reach of the stores, therefore also apply to Galaxus. Thanks to the strong focus on content and e-mail marketing, the products of members of the retailer program can be marketed effectively.
Another advantage is the cost structure of Galaxus and Digitec. Although fees are charged for goods sold, there is no basic fee. The sales fee depends on the respective product category and can be between 7 and 20 percent.