EU4Digital has launched its eCommerce pilot, establishing national virtual warehouses in the pilot countries to support retailers, marketplaces, delivery operators and customs to place the products for sale abroad and facilitate cross-border delivery.
In Azerbaijan, a seller of handcrafted wooden accessories (ISAR Group) sold a product to Germany through the virtual warehouse. The seller was supported by the national eCommerce platform Azexport.
Two Georgian sellers – both women-led businesses, one producing children’s clothing (RKO) and the other eco-friendly housewarming gifts (Funduki) – did the same, as did an Armenian seller of socks (Zeal Socks).
Why the pilot was launched
The pilot was launched in May-June between the three Eastern partner countries in the South Caucasus – Armenia, Azerbaijan and Georgia – and Germany. The eCommerce pilot aims to support SMEs in the following way:
- Strengthen eCommerce ecosystem and increase eCommerce volumes;
- Increase the awareness and support to prepare to the 2021 eCommerce VAT package introduced in the EU;
- Address the existing challenges for cross-border eCommerce trade.
In addition, in Georgia, the focus of the EU4Digital pilot is on women-led businesses to support them in eCommerce with the EU.
Read more about the concept and the goal of the EU4Digital eCommerce pilot.
How the pilot was launched
During the pilot, sellers from the Eastern partner countries accomplished the following:
- Product placing in the virtual warehouse. Sellers use the newly-established national virtual warehouse to add products for online sale in Germany. Sellers create a centralised product listing to describe products both to list on the marketplace as well as for the customs purposes.
- Product listing on the German marketplace. Next, the harmonised product listing on the virtual warehouse is sent to German eBay to place products for sale on the marketplace.
- Product purchase. Once a purchase happens on eBay, the piloted virtual warehouse automatically generates a mandatory and necessary data for customs, import duties, transport security and product safety documentation in real time.
- Exchange of product data. Generated data is shared by the piloted solution with the logistics and transport provider so that they can complete the physical delivery of purchased products to buyers. This way, sellers enter product data only once in the virtual warehouse, and the virtual warehouse shares this data to complete the transaction.
During the pilot launch, Azerbaijani seller “ISAR” LLC sold a handmade wooden desk organiser, which was delivered in 5 working days to the buyer. Throughout the entire delivery period, the buyer in Germany had the possibility to track the purchased item online.
From Georgia, two women-led businesses participated in the pilot. The RKO children’s clothing business sold a 100% hand-knitted collar. Funduki, the eco-friendly housewarming gifts store, sold a banana style waist bag. Both items were delivered to the buyer in 7 working days.
An Armenian seller of socks – Zeal Socks – also participated in the pilot to sell to Germany. The socks were delivered to the buyer in 9 working days.
Further promotion of eCommerce pilot results
The digital exchange of product data becomes mandatory in the EU in July 2021 as postal and customs documents have to be digital. The piloted virtual warehouse supports sellers to enter digital data about products only once and facilitates the exchange of this data with the post and the customs.
EU4Digital is cooperating with the German association, which is a member of Ecommerce Europe and is supported by more than 30,000 German SMEs. The German partners are continuously involved in the pilot, promoting it and showing strong interest for a future scale-up of the solution.
Pilot to raise awareness of digital eCommerce between two Eastern partner countries – Azerbaijan and Georgia
In addition to the pilot between the Eastern partner countries and Germany, EU4Digital also launched a pilot between Azerbaijan and Georgia. The aim was to explore the potential benefits of the eCommerce virtual warehouse between the Eastern partner countries. The pilot was launched using an existing national platform, Azexport in Azerbaijan, where the same Georgian sellers sold products during the pilot. The products sold were delivered to the buyer within 4 working days. The pilot provided insights on the required technical capability to automate the exchange of data on marketplaces in the Eastern partner countries.
As the next step, EU4Digital is launching the pilot between Azerbaijan and Georgia in the beginning of June to explore how the virtual warehouse can support eCommerce in the Eastern partnership region.After the completion of the pilot, the EU4Digital team will provide further recommendations regarding the required legal, organisational and technical changes in order to adopt the piloted solution in production as well as scale-up in other Eastern partner countries.