{"id":9177,"date":"2023-07-04T07:46:53","date_gmt":"2023-07-04T05:46:53","guid":{"rendered":"https:\/\/eurotext.de\/en\/?p=9177"},"modified":"2024-09-30T08:48:44","modified_gmt":"2024-09-30T06:48:44","slug":"e-commerce-in-switzerland","status":"publish","type":"post","link":"https:\/\/eurotext.de\/en\/blog\/e-commerce-in-switzerland\/","title":{"rendered":"E-commerce in Switzerland"},"content":{"rendered":"

The Swiss e-commerce market<\/strong> is no longer a secret, insider tip. Located right on the EU\u2019s doorstep, and with purchasing power to spare, Switzerland is an extremely attractive market for European companies who are looking to expand. Moreover, Switzerland ranked number one in the UNCTAD B2C E-commerce Index<\/strong>, which ranks countries according to their e-commerce readiness. However, there are a few challenges that you\u2019ll need to bear in mind when expanding to Switzerland, especially when it comes to customs duties.<\/p>\n

Facts & Figures<\/h2>\n

Switzerland is a medium-sized country in the heart of Europe. It has a population of approximately 8.8 million<\/strong>, making it slightly smaller than Austria<\/a> in terms of residents. In terms of area, Switzerland is about the same size as the Netherlands<\/a>, with an area of 41,285 km\u00b2. This means that the density is approximately 213 people per km\u00b2<\/strong>. That puts it right between Germany and Italy<\/a> in population density.<\/p>\n

Switzerland is Germany<\/a>\u2019s only neighbor that is neither part of the EU nor the European Economic Area<\/strong>. The official currency in Switzerland is the Swiss Franc (CHF), which is also the official currency in Liechtenstein. One Swiss Franc is divided into 100 Rappen.<\/p>\n

Internet penetration and online purchasing habits<\/h2>\n

Switzerland has an exceptionally high rate of internet penetration, with an estimated 98% of the population having internet access<\/strong>. Additionally, 76.5% of Swiss people own a smartphone, with this number steadily increasing. These are just a few of the reasons that Switzerland is currently considered the most e-commerce-ready country in the world.<\/p>\n

The volume of the Swiss e-commerce market is expected to reach around 12.5 billion Euros in 2023<\/strong>. Experts predict continued growth<\/strong> in the coming years, at a rate of around 12%.<\/p>\n

The typical Swiss e-commerce customer has considerable purchasing power, and average e-commerce revenue is expected to reach around 1,800 Euros per person<\/strong> in 2023. This is one of the highest e-commerce spending rates in Europe. Around 57% of Swiss people shop online at least once a month<\/strong>, and only 6% have never used the internet for shopping. Given the fact that the population of Switzerland continues to age, it is also worth noting that older adults are increasingly open to the internet. Currently, nearly 80% of seniors use the internet<\/strong>, and almost a third have made online purchases.<\/p>\n

Cross-border commerce in Switzerland<\/h2>\n

Traditionally, the Swiss e-commerce market has relied heavily on purchases from foreign countries<\/strong>. This is mainly due to the fact that prices in Switzerland are significantly higher than in neighboring states \u2014 between 35% and 97% higher, for some categories.<\/p>\n

And the fact that Switzerland\u2019s three main languages are spoken in less-expensive, neighboring countries makes cross-border shopping quite easy. So it should come as no surprise that 103.7 million cross-border e-commerce shipments<\/strong> were imported to Switzerland in 2018 \u2014 an average of nearly 12 shipments per capita<\/strong>. Price is the main reason for cross-border shopping, but product availability is a major driving force as well.<\/p>\n

Swiss customers do have to pay customs duties when purchasing from abroad, which reduces the price difference between domestic and foreign goods. However, there are ways to get around the customs duties, such as having packages delivered to pick-up points in border towns in Germany<\/a> or France<\/a>. But even when customers do pay customs duties and other transaction fees, the savings can still be considerable.<\/p>\n

Most popular e-commerce websites in Switzerland<\/h2>\n

There are some large Swiss-based websites such as the online department store Galaxus.ch, the electronics retailer Digitec.ch, and the online auction house Ricardo.ch, that give the international giants a run for their money. Nonetheless, the usual suspects are also very popular here: amazon.de, eBay, and Zalando. Galaxus.ch is, in principle, similar to amazon.de, but has a much smaller selection of available products in comparison.<\/p>\n

Localization<\/h2>\n

Switzerland has four official languages: German, French, Italian, and Romansh<\/strong>. While almost all of the roughly 40,000 people who speak Romansh also speak Swiss German, it’s important to localize<\/a> your website for (Swiss) German, French and Italian when targeting this market. The German-speaking community is the largest, making up almost 62% of the Swiss population.<\/p>\n

Swiss German has many local dialects, but they are generally used only in spoken language. For written communication, Standard Swiss German<\/strong> is almost always used. It\u2019s important to note that Swiss German has some differences in vocabulary and spelling compared to the standard German used in Germany and Austria. You will definitely want to localize your German-language website specifically for the Swiss target market.<\/p>\n

French is spoken by almost 23%<\/strong> of the Swiss population, making it the second-most common language. French is mainly spoken in the west of Switzerland and typically uses standard French, as it is spoken in France<\/a>. There are some minor differences in the way the numbers 70 on up are written out as words, but this will have little impact on most texts.<\/p>\n

Last but not least, around 8% of the Swiss population speaks Italian<\/strong>, mainly in the southeast of the country. Swiss Italian varies somewhat from standard Italian.<\/p>\n

Payment Methods and Shipping<\/h2>\n

The most common payment method in Switzerland is bank transfer<\/strong>, accounting for around half of all transactions. The second most popular payment method is credit or debit card<\/strong>, which account for nearly 25% of transactions. It’s worth noting that each Swiss person has an average of nearly 2 debit cards and almost one credit card. Digital wallets<\/strong> are also notable, accounting for 16% of e-commerce transactions. PayPal is the major player here.<\/p>\n

Swiss Post<\/strong>, a state-owned corporation also known as “Die Post”, is by far the most important shipping service provider<\/strong> in Switzerland. Nearly 75% of e-commerce businesses have stated they use Swiss Post for their shipping requirements. The other shipping companies active in Switzerland include DPD with 13% of the market share and DHL with 12%.<\/p>\n

E-Commerce Categories<\/h2>\n

In general, fashion is the largest e-commerce market in Switzerland<\/strong>, accounting for 31.9% of e-commerce revenue. The next most popular categories are food & personal care<\/strong> with 26.6%, furniture & appliances<\/strong> with 14.7%, electronics & media<\/strong> with 14.6%, and toys, hobby & DIY<\/strong> with the remaining 12.1%.<\/p>\n

The most popular import products<\/strong> among Swiss consumers are: clothing, footwear & apparel (28%); books, music & media (16%); sport & leisure and health & beauty (each 12%) and consumer electronics (11%).<\/p>\n

Customs & Importing<\/h2>\n

Because Switzerland is not part of the EU or European Economic Area, businesses who export to Switzerland need to be familiar with the complex customs regulations<\/strong>. Although this is a challenge, it is really a hidden opportunity \u2014 many retailers shy away from Switzerland, so the market is underserved.<\/p>\n

There are two Incoterms (shipping terms) that are important for cross-border e-commerce: DAP and DDP. DAP (Delivery at Place)<\/strong> is when the seller hands over shipments to a delivery service provider, who then takes care of customs clearance. With this shipping method, the recipient is responsible for paying any duties or taxes<\/strong>. This can be very inconvenient for customers.<\/p>\n

With DDP (Delivered Duty Paid)<\/strong>, on the other hand, the seller takes care of all customs and taxes. This means that the recipient doesn’t have to worry about customs fees<\/strong> \u2014 they pay for everything while completing their order with the seller. Swiss Post offers a platform that is meant to simplify DDP shipments, which should help e-commerce sellers offer their Swiss customers a more convenient shopping experience.<\/p>\n

Imports on which less than 5 CHF<\/strong> in VAT would be owed are exempt from VAT payment<\/strong>. In practical terms, that means that any individual shipment with a transaction value (the value of goods, freight costs and any customs duties) is less than 65 CHF for products with a VAT rate of 7.7%<\/strong>, or less than 200 CHF for products with a VAT rate of 2.5%<\/strong>, is exempt from VAT.<\/p>\n

Sellers with turnover of more than 100,000 CHF<\/strong> in Switzerland are required to register and pay all<\/i> VAT<\/strong>. The exemptions no longer apply.<\/p>\n

Customs duties in Switzerland<\/strong> are calculated based on weight of the goods, and customs duties equaling less than 5 CHF are also exempt from payment.<\/p>\n

Conclusion<\/h2>\n

For European companies looking to expand to a new market, Switzerland should be one of the top options to consider. Switzerland\u2019s exceptional purchasing power<\/strong>, proximity to the EU, and consumers\u2019 keen interest in imported goods<\/strong> are great reasons to add Switzerland as a target market. The complexity of the customs situation should not be overlooked, but for businesses who are willing to accept the extra administrative effort, this can be a hidden opportunity. All in all, Switzerland is a very interesting market.<\/p>\n
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