Published: 24 Jul 2019
Updated: 18 Aug 2021
Category: Startups , Ecommerce , Entrepreneur , Digital & Marketing

How to Start Cross-Border E-commerce from Hong Kong

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According to UNCTAD’s Business-to-Consumer e-commerce index from the end of 2018, Hong Kong was ranked 15th out of 151 most prepared countries for online businesses.  Hong Kong’s favourable trends for e-commerce might have motivated you to start a cross-border business of your own. 

Since launching your online business in Hong Kong requires reliable shipping globally, various setups, payment methods, and compliance with different regulations, starting it may seem like a tough call. 

This article will guide you through the factors to consider to start a cross-border online business in Hong Kong using your own e-commerce site:
 

1. Become Familiar with the Law

Before you launch an online business in Hong Kong, you should get familiar with all the important institutions and regulations concerning online trading. At the moment, Hong Kong doesn’t have a separate law that regulates e-commerce. Instead, there’s a network of separate trading and business laws that include e-commerce activities.

In April 2000, the Hong Kong government introduced the Electronic Transactions Ordinance (ETO) with the purpose of equalling online businesses with traditional ones. Therefore, electronic records and signatures should have the same authority as their physical counterparts. 

Furthermore, your business can get an online digital certification, which verifies your reliability. These regulations are essential when you sign virtual contracts with your clients, as they have both domestic and international recognition.

You should study all of these online regulations thoroughly before you start an online business. 
 

2.  Choose Between Hosted vs Self-Hosted E-commerce Platform

Before you set up an e-commerce platform, decide how you want to host your site. Hosting a website refers to the practice of storing, maintaining, and making a site data accessible in the world wide web.

Two types of hosting you can consider are:
- Hosted e-commerce platforms, like Shopify, Volusion, and BigCommerce.
- Self-hosted platforms, such as Magento and Craft Commerce.

Hosted e-commerce solutions

Pros:

- Come with built-in template and functionality, such as a site theme, product page layout, features for purchase, payment, and customer reviews. 
- The initial set up requires minimal expertise of the back-end workings of an e-commerce.
- Speed in adjusting to fluctuations in site activity. For instance, you can accommodate higher traffic to the site by upgrading your plan.

Cons:

- Some hosted e-commerce platforms don’t allow the use of more than one language, and most of the time it’s English-only.
- Limited range of customization. 
- May require you to migrate your site to a self-hosted platform to facilitate customizations as your site grows.
 
Self-hosted platforms 

Pros:

- Offer more flexibility to create functionality that is tailored to your business. 
For example, most e-commerce platforms, regardless of the hosting type, act only as web shops without non-product content managing. With self-hosted platform, you may integrate a content management system with your e-commerce store. 

Cons:

- Require expertise to deal with the technicalities of maintaining a server load, security, and creating new features from scratch.

Check out our upcoming event on how to start a cross border e-commerce in Hong Kong if you have further questions on the topic.
 

3. Ensure Platform Availability in the Target Country

As each country regulates their internet space differently, make sure your e-commerce platform can be accessible from your target country. For instance, if you want to sell your goods to customers in China, you’ll need to use a hosted platform that is available in this area. China’s strict internet laws may block certain hosted platforms, while, on the other hand, some platforms don’t allow you to integrate any Chinese payment gateways. 
 

4. Make Your E-commerce Platform Multilingual

Online e-commerce platforms are the essence of your digital business. They are your virtual shops and the way you set them up can greatly influence your business revenue. When you’re looking to set up a cross-border e-commerce platform in Hong Kong, consider making your platform multilingual. If your business is Hong Kong-based, it would be great to use at least both English and Chinese. Consider your target customer and the language they speak in to decide what language capability your e-commerce site should have.
 

5. Set Up a Payment System

Use systems that can offer payment in your customer’s currency. At the end of 2018, the Hong Kong Monetary Authority (HKMA) launched the Faster Payment System (FPS). This system allows you to use your mobile phone or e-mail address to process payments in Hong Kong dollars and renminbi at any time and place. It also enables payments outside of regular business hours and instant transactions from anywhere in the world. 
 

6. Arrange Logistics and Fulfillment 

Once you set up your online shop and ensure its compliance with local regulations, you need to think of a way to distribute your products to the consumers. With e-commerce, the orders are usually small with oscillating demands and come from many parts of the world. 

Luckily, there are services that will store your goods, pack them, and ship them to the clients. These services are known as third-party e-commerce logistics. Hong Kong has a lot of logistic services that integrate with Amazon, Shopify, and other online platforms and can distribute your products across the border. 

Most of these logistics services allow you to focus on marketing, while they deal with all the required steps to deliver the products to your client. So whether you’re delivering cross-border or in Hong Kong, e-commerce fulfillment means that the service you hire will receive, pack, process, and deliver the goods.

Some of the best cross-border logistics and fulfillment services include Shipwire (cloud-based), ZhenHub (Hong Kong), Tigers (Hong Kong), and Stork Up (Hong Kong).  
 

What's Next

There has never been a better time to start e-commerce business in Hong Kong. The international laws regarding e-commerce keeps improving, hosting solutions are plenty, while new online payment methods are on the rise. Both traditional banks and online payment gateways are starting to integrate which makes purchasing any product in the world easier and faster. Also, third-party logistics and fulfillment services make cross-border delivery easy and secure. All you need is to start working your way through the steps above with thorough research, a bit of money, and quality products. 

If you want to know more about how to start a cross border e-commerce in Hong Kong, stay tuned for our upcoming event on the topic.

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