Allegro and the new foreign market – diagnoses and prophecies
In March/April 2023, gruff the news that the Allegro service was opening or rather activating a Czech site (in terms of language and functions), and proceeding with dedicated operations in the Czech Republic, under a separate domain and as a separate Internet entity. As is usually the case with such news shots, Internet opinion has articulated pros and cons, home-grown analysts have been rallying for early failure, and… the moon doesn’t care for barking dogs. And now this selling option is available for Allegro merchants.
Table of contents:
- Allegro.cz – if, when and why
- Why marketplaces like cross-border sale
- Recycling in the Czech Republic
- Conclusions and subjective impressions
Allegro.cz – if, when and why
20 years ago we enjoyed aukro.cz, which was owned by a company briefly identified as Allegro and an equivalent(or perhaps a copy) of the Polish version of the website. The site and the company still exist today and is a sampler of the Czech e-commerce market. To advanced users of e-commerce, including cross-border sales, it is rather associated with yard sale and in-person pickups – that we mention from the last years of the previous century (in e-commerce). In any case, it has absolutely nothing in common with Allegro.
To the dust and memories of older users of online sales belong other Czech sites once owned by the polish-associated giant, like: Heureka.cz or Seznamzbozi.cz.
However, in April 2022, the Czech group Mall WE/do (mall.cz) was taken over by Allegro in terms of capital (less about specific company names and capital ties), in July 2022 the Polish version of the mall.pl store was terminated, and careful observers could deduce that it will therefore be a matter of a year at most for Allegro to expand in the Czech Republic.
In fact, we are talking about re-expansion, a return to the market in new realities. About a new narrative for its neighbors – a post-pandemic Czech Republic, socially reorganized, with many internal tensions.
Allegro in the Czech Republic has already been and is coming back, it seems like old chestnut, but prepared, however, with other ingredients. Re-launch opens with the question why this marketplace crosses borders (not only territorial, but business risk border as well).
First, to gain access to a larger customer base understood as both sellers and buyers. Entering the Czech market allows Allegro to reach new customers and increase its user base.
In a world of VUCA economics and BANI uncertainty, operating in the next market under its own refined brand helps Allegro minimize the risks associated with the stagnant market and diversify yet a source of revenue – no question – the thing has been successfully recalculated.
Not insignificant is the competitive challenge and quick ability to respond to changes in the environment: by entering this market, Allegro can compete with other e-commerce platforms, such as Slevomat or Alza, for example.
As Allegro – as if it doesn’t sound like – it will be taking off from an well-established position, we will probably see echoes of the economies of scale of excellent customer service, which in the case of Allegro is unquestionable, no matter how many individual negative comments we find online.
Why marketplaces like cross-border sale
This question could be asked with certainty and great efficiency to artificial intelligence chatbots, they would probably answer that the marketplace is entering a new market to have access to more users, which will translate significantly into the budget result (whether understood as revenue or profit). They would probably also answer that labor costs can be better managed, diversified and the market environment and its potential fluctuations can be managed according to the old Roman command of divide and rule (divide et impera)… in business.
For us, according to the press announcements, another indicator is of particular importance. By entering the Czech market, Allegro will gain access to new products or services that are not available in Poland or other European countries. Forgetting the local color and specificity of the region is often the first element that “puts down business.” The scale of operations and financial background allow not only to promote (immediately ) payments in the local currency and through Czech financial operators, but also to prepare an interface dedicated to Czechs (and not just copies translated). Yes, Internet users in different countries have different routines also when it comes to the way they use websites or make purchases (e.g. from their laptops, computers at home or apps on public transportation).
See what change awaits you in google analytics: Google Analytics 4, e-commerce analytics and developments ahead
The second equally important indicator is competitive advantage: again, the effects of scale and good preparation for deployment (launch) can have a measureable effect of winning over local players, who are absolutely and undoubtedly, for the moment, more focused on their home Czech market.
Conclusions and subjective impressions
We already know, or at least we intuit, the intentions behind Allegro’s move across the southern border, what the effect of this expansion will be – we don’t know anymore, but we also intuit next one time, that the first summaries won’t come before three years – since the acquisition process itself and the shutdown of the Polish part of the bought company took a year.
We have such a time today that in business everything happens fast, but business itself happens as it was before, laboriously and slowly, perhaps even slower than before. Not without reason Franz Kafka (nomen omen, a German-speaking writer of Jewish origin, whose whole life was associated with Prague, Czech Republic) wrote that the heaviest chains are the administrative ones….
So, for the competition with Allegro, there is a set of podium competitors:
Alza.cz – probably the most well-known marketplace, offering a wide range of electronic products, household appliances, electronics, clothing, cosmetics and much more;
Zbozi.cz – A sales platform with a wide range of products, including apparel, electronics, cosmetics, tools, really great-performing
Rohlik.cz – Online grocery store, offering a wide range of food products, including fresh fruits and vegetables, meat, dairy, baked goods and more.
In business, you have to be either first or second, but better, or find a niche. Through the keyhole, from the logistics niche, we will be looking at Allegro’s expansion to the south.
A few words about recycling in the Czech Republic
Waste and packaging regulations aim to protect the environment and promote sustainable waste management. In the Czech Republic, waste is required to be sorted into various fractions such as paper, plastic, glass, metal, and biodegradable waste. As a business owner or seller, you have an obligation to comply with these rules.
Regarding packaging, there are regulations for producers and distributors. Producers must adapt their packaging to recycling and material recovery requirements. Additionally, distributors are required to provide information to customers on proper handling of packaging and waste.
In the Czech Republic, there are also recycling requirements. Companies must cooperate with relevant institutions and organizations involved in waste collection, processing, and recycling. A packaging management system has also been implemented to minimize the amount of packaging waste.
See what Amazon supports in registering packaging and waste: Waste accounting / packaging registration by Amazon
Compliance with waste and packaging regulations is crucial for sustainable development and environmental protection. Implementing proper sorting and recycling practices can contribute to reducing the negative impact on the environment and promoting a more sustainable future.
When you are exempt from certain obligations
If in a given calendar year, you introduce packaging into the Czech market weighing a total of less than 300 kg, and your annual turnover is less than 25 million CZK, you are not subject to the obligations mentioned in points 3, 4, and 5.
International returns and shipments with Global24 support
Regardless of the model you’re currently working with or the model you’re just considering, we will help and provide suggestions on how to optimize your orders and returns that you’ll be processing. At Global24, we handle shipments and returns while offering logistics solutions without borders. Therefore, if you’re already considering international expansion and searching for an effective partner in cross-border logistics operations, feel invited to discuss selling in markets beyond Poland. We are waiting and welcome you to get in touch!
Our recommendation for cross-border selling
Cross-border sales in the era of the global village are perceived as a natural course of action. If you can adapt your e-commerce offerings to meet the local needs and preferences of Czech customers, don’t hesitate to act, even through the Allegro marketplace. However, make sure you have a suitable range of products, describe them in the local language (even with the help of a translator), and consider local customs and preferences. Your logistics partner, Global24, is ready to act alongside you.
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