Verkkokauppapulssi: Growth in domestic e-commerce continued – the EU’s new regulation is slowing down the internationalisation of small online stores

According to the recent Verkkokauppapulssi* survey by Digital Commerce Finland, the Federation of Finnish Special Commodity Trade ETU and the Finnish Commerce Federation, e-commerce sales in Finland increased by approximately 5.2 per cent in the second quarter of the year when compared to the same period last year. Meanwhile, according to Statistics Finland, sales in the retail sector as a whole increased by 3.6 per cent.

Part of the growth of e-commerce can be explained by the fact that more adults than before have made digital purchases: 77 per cent of the adult population say they have made purchases online, while the share was a few percentage points smaller at the beginning of last year. Another factor that has accelerated growth is the growth of general purchasing power, which is also reflected in online purchases.

”The decline in the popularity of Chinese websites during the spring and summer is also evident: it seems that at least part of online purchases have been made in stores operating in Finland,” says Jaana Kurjenoja, Chief Economist of the Finnish Commerce Federation.

Online retailers still have high expectations of growth for domestic sales. More than a third expect very rapid growth of up to more than 10 per cent during the year, and 45 per cent expect slightly more moderate growth.

Expectations of growth for sales abroad have strengthened since the beginning of the year, but they are still not at the same level as last year.

”Ongoing geopolitical uncertainty and the unpredictability of customs policies have clearly slowed down expectations of opportunities in the international market,” says Mirva Sandström, Director at Digital Commerce Finland.

Regulations in Europe are also currently seen to slow down the growth of cross-border sales. The EU’s new Packaging and Packaging Waste Regulation (PPWR) particularly raises concerns. In the open responses to the company survey, some online stores even say that they have temporarily suspended sales to some EU countries until the effects of the new regulation on their own operations become clear.

“The growth of the administrative burden weakens the opportunities of small, specialised online stores, in particular, to internationalise and compete with large international operators,” says Jenni Homer, Managing Director of the Federation of Finnish Special Commodity Trade.

* Verkkokauppapulssi is a quarterly e-commerce market monitoring. It combines the information obtained from the company survey with the overview provided by different sources of the development of the Finnish e-commerce market. The company survey typically receives responses from approximately 100–200 companies.

The online stores that complete the survey gain access to a separate Verkkokauppapulssi report.

Jaana Kurjenoja, Chief Economist of the Finnish Commerce Federation, is responsible for producing the content of the report.

For further information, please contact:

Jaana Kurjenoja, Chief Economist, Finnish Commerce Federation
Tel. +358 (0)40 820 5378, jaana.kurjenoja(at)kauppa.fi

Mirva Sandström, Digital Commerce Director, Digital Commerce Finland
Tel. +358 (0)400 984 141, mirva.sandstrom(at)digitalcommerce.fi

Jenni Homer, Managing Director, Federation of Finnish Special Commodity Trade (ETU)
Tel. +358 (0)40 900 6389, jenni.homer(at)etu.fi