Interview with Jiří Černý from EXPANDO global s.r.o., which focuses on opening and combining sales channels around the world

Prague´s start-up IP Fabric has announced an investment of 1,3 mil. EUR from Credo Ventures
6.4.2017
Uber has been temporarily shut down in Brno
20.4.2017

EXPANDO global s.r.o. is engaged in online expansion in the area of e-commerce and has been operating on the market since April 2016. With its founders’ more than ten years of experience, unique know-how and cooperation with giants such as eBay, cDiscount and Amazon.cz, the company is a beautiful example of how a Czech start-up can establish itself in the world and, after only a year on the market, expand to Germany, Great Britain, France, Italy, Spain and the United States.

To present EXPANDO’s full story, we sat down with Jiří Černý, who has been with the company since its establishment, and spoke with him not only about EXPANDO’s origins, but also about obstacles the firm has encountered and its cooperation Amazon.cz and eBay.

In order to give you an even better idea about EXPANDO, we would like to give you a few specific figures that say it all. The company’s GMV (gross merchandise volume), i.e. turnover earned for its clients, is in excess of EUR 140,000 per month and is growing at a rate of 15%-20% monthly. The company currently has a stable of 62 clients in seven countries and in three marketplaces.

Q1: Thank you for taking the time to sit down with us. To start, please tell us exactly what EXPANDO does and who your potential clients are.

EXPANDO helps e-shops on foreign markets. In connection with that, we select e-marketplaces whose operators allow third-party sellers to offer their goods. Today in Germany, every second order is executed not through an e-shop, but through a marketplace. We are attempting to open up this potential also for Czech producers and sellers.

A client who comes to us has the possibility of complete outsourcing of this form of expansion to seven countries. Since the beginning, we have been assisting with establishing and setting up sales accounts. We communicate with marketplace workers, thanks to which we can more quickly and easily obtain sales permits in categories that are regulated. Then we take care of listing the products, which has a significant impact on the sellers’ success rate. We also handle customer support in local languages and help clients with shipping their goods and returns.

EXPANDO cooperates with all kinds of e-shops, as well as with producers and sellers who don’t have an e-shop solution. We focus especially on goods in the categories of fashion, household and kitchen products, and sporting goods.

Q2: When we wrote about your origins, you told me that you had to open up the potential of marketplaces. What is your view of that today? Do you feel that the potential is still changing?

There is tremendous potential for us, so we have focused our activities in that direction. The current trend shows that there is a significant group of customers who prefer purchasing goods on large marketplaces involving precise service and high-quality goods. On the other hand, these customers aren’t too concerned with where the given products come from. In that lies an opportunity that we are striving to bring to our clients.

This phenomenon is apparent also among Czech customers, since cross-border shopping is on the rise here. In 2014, Czech’s online purchases from abroad comprised one-tenth of the turnover of Czech e-shops (according to the Payment Card Association). And that number is increasing by ten to fifteen percent year on year. Therefore, we believe that this trend will continue, which will both unify sellers’ product offer and also wipe out the physical borders between countries.

Q3: A lot of people surely ask you about this, but we need to ask as well. How does a young Czech start-up get together with a giant such as Amazon or eBay? Surely that’s bringing you a lot of new potential clients, but you could also lose a certain clientele because of that.

Cooperation with these giants isn’t very easy. Our advantage is that, thanks to cooperation with dozens of successful Czech e-shops, we are a more significant player in their eyes than the e-shops would be individually. Therefore, they are substantially helpful to us with respect to, for example, getting sales permits in particular categories and verification of sellers.

Where clients are concerned, we certainly encounter those who do not want to have anything in common with marketplaces, especially due to the certain anonymity of the seller. However, we strive to show them the possibilities of these other distribution channels because they have their own specific customers. Expansion with us is generally connected with entry costs and risk associated with return on investment (in comparison with localisation of an e-shop) and in our experience, it brings our clients revenue growth of ten to fifteen percent from new customers.

Q4: In the introduction, we spoke about the obstacles every firm encounters in the course of doing business. What do you see as the biggest obstacle not only in the Czech Republic, but also on the global market?

The biggest obstacle and, at the same time, opportunity is in the unification of markets. Customers place greater emphasis on the quality of products and services than on their place of origin. Therefore, producers and sellers are coming into direct competition with a lot more players than on the local market. An obstacle in the further development of Czech e-shops’ business could thus be isolation and ignorance of development on more advanced markets, which will also be copied to a certain extent by the Czech market.

Czech sellers and producers have something to offer customers and the geographic location also favours them. So, it’s only up to them whether they can use this opportunity or not – and that by no means has to be through global marketplaces!

Q5: What are your plans for the future? Where do you see yourself in, say, five years?

Our objective is to help clients with optimisation and administration of product data, thanks to which we will be able to open up new sales channels and thus acquire new customers. In terms of our operation, we are now opening up also to foreign clients and we want to continue in that spirit going forward.

Thank you very much and we wish you a lot of success, further successful expansion and satisfied customers.

For more information, visit EXPANDO’s official website at http://www.expando.cz/ .