International Expansion of E-Retailers: Where the Amazon Flows.

In this article the author argues that trans-border transactions costs continue to be a significant barrier to international e-commerce. Online retailers are devising strategies to overcome the obstacles raised by international borders in reaching new customers. Online retailing has experienced dramatic growth in recent years. While consumers are increasingly shopping on the Net, the rates of return, operating margins, and gross margins of online retailers have been low and declining. This is indicative of intense and increasing competition in the online environment. It is becoming increasingly evident that e-retailers cannot just assume that they can serve foreign consumers with no extra effort simply because foreigners can point and click to the website as easily as domestic buyers. As competition among e-retailers becomes increasingly intense, the key to survival lies in rapidly expanding market size. The author remarks that this article has also raised several questions for future research.