E-Commerce

Galaxus - the new Amazon? Everything you need to know about selling on the Swiss platform

Fatih-Kağan Taşkoparan

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Whether it's household goods, electronics or gifts - no matter what you need, you often search for the relevant items online on marketplaces such as Amazon or eBay. However, this is not the case everywhere. In Switzerland, the leading electronics marketplace Galaxus dominates the retail scene - even before the local online retailers. With a wide range of products and a user-friendly shopping experience, the Swiss company has now also established itself as a popular online marketplace in Germany. What makes the platform so successful and what German online retailers need to be aware of when selling their goods on the marketplace was explained to us by the Swiss tax and fiduciary expert from the cmt ag Dominik Baldegger explained.

Galaxus' destinations in Germany

Together with its sister company Digitec and retail giant Migros, Galaxus has been focusing on the German-speaking market for several years. No wonder: the sales forecast for e-commerce in Germany alone is around 102.20 billion euros for 2023. valued. Galaxus' goal is to export the successful business model from the Alpine republic to the top 5 German online marketplaces. With locations in Hamburg and Krefeld, Galaxus also wants to work together with Deutsche Post in order to guarantee German customers the usual high quality of the retail platform in terms of fast shipping.

"In view of the company's recent history, Galaxus was able to develop in a Swiss market that is largely protected by customs regulations," explains Baldegger. As a registered partner of Galaxus, his law firm primarily advises foreign e-commerce companies in addition to traditional accounting, VAT returns and declarations. Due to his early specialization in mail order companies in Switzerland, Baldegger and his ten-strong team can look back on a wealth of experience.

"Right from the start, the platform was able to offer a relatively wide range of products at a reasonable price," continues Baldegger. The online marketplace also scores points for its extremely fast shipping and the quality of its customer service. "Same-day delivery, or delivery times that German customers may only know from Amazon Prime, have been standard at Galaxus right from the start," says Baldegger. He also told us what German online retailers need to bear in mind when selling goods in Switzerland and what other special features characterize the platform.

Switzerland's relationship with the EU

In the European Union (EU) and the eurozone, cross-border trade is regulated relatively simply. This is because there are no customs duties, VAT or customs fees when selling goods abroad within the EU. Cross-border e-commerce with Switzerland, on the other hand, can pose a number of challenges for online retailers: As a non-EU member state, the Alpine republic is not bound by EU regulations. This means that Switzerland itself determines the laws and regulations that govern its economy and trade relations. However, in order to simplify trade between Switzerland and the EU, there are Various agreements and partnerships, such as the free movement of persons, goods and services.

EU hub: online shopping in the EU without side effects

Customs regulations apply to the movement of goods between Switzerland and the EU. This means that purchasing products online from the EU is often not easy: customs duties are incurred depending on the purchase amount and the delivery time can often be delayed. However, when selling goods to Switzerland via Galaxus, there are virtually no obstacles to customs clearance, as tax consultant Baldegger explains. Galaxus has taken care of this: "The so-called 'EU hub' was introduced and officially licensed by Galaxus as a cross-border solution for goods from European countries. This also enables German online retailers to enter the Swiss market easily. The shipping and transportation itself is handled entirely by Galaxus."

This means that Swiss customs and taxes are no longer an obstacle and German online retailers can tap into the Swiss market in this way, Baldegger continues. "The retailer sends their goods and products to the specially created shipping and transport warehouse in Weil am Rhein and Galaxus takes care of the rest." Fully automated process control for purchases and returns is handled by the specially developed logistics and customs software. This means that German retailers no longer have to worry about Swiss customs regulations.

It remains to be seen whether the Swiss platform will develop into one of the five most popular marketplaces in Germany. According to the Swiss tax and fiduciary expert, the scalability of the successful model, i.e. fast delivery times, very good communication with customers and transparency are certainly the factors that will determine success or failure.

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