Leadership Insights: Cross-Border E-Commerce is Surging. Is Your Business Taking Advantage?

Global cross-border e-commerce sales are projected to reach $3.3 trillion by 2028, up from the $1.6 trillion spent during 2023. That’s a 96% increase and presents an exciting opportunity for U.S. and Canadian businesses – businesses of all types and sizes — to look beyond their borders for market expansion.

Consider just how prevalent global cross-border e-commerce has become. According to research from Capitol One, cross-border purchases accounted for approximately 32% of all e-commerce sales during 2024 and are expected to grow at a rate that is 219% faster than global e-commerce overall through 2028. Research by PPRO delves into the buying habits of consumers across key markets. A few findings include:

• China has the largest number of online shoppers with an estimated 988 million consumers. Of that population, roughly 40% have bought items from foreign e-commerce sellers. Those purchases totaled US$480 billion during 2022.
• India is the world’s fastest growing online market. During 2022, nearly 850 million consumers shopped online, 30% of whom made purchases from international sellers.
• Across Europe, notable findings include:
  • Spain: 52% of consumers report shopping with an international seller.
  • France: Almost two-thirds of French online shoppers – 64% — have made an international purchase, accounting for 17% of that country’s total e-commerce volume.
  • Germany. 43% of German consumers report shopping with an international online seller, accounting for 20% of total online sales.
  • United Kingdom: 47% of consumers have shopped cross-border, representing 12% of total e-commerce.
• Closer to home in North America, 41% of U.S. online shoppers made a purchase from a non-U.S. online retailer in the past year, with cross border sales accounting for 16% of all e-commerce activity. That number was much higher among Canadian consumers, with 63% saying they had shopped with an international retailer, representing 22% of total e-commerce sales.

As these findings make clear, cross-border e-commerce opens the door to hundreds of millions of potential new customers. But what exactly are consumers buying? Well, everything it seems. According to the U.S. International Trade Administration, leading categories include:

• Consumer electronics
• Fashion
• Furniture
• Toys/hobbies
• Pharmaceuticals
• Media & entertainment
• Beverages

Based on this expansive list, it would seem that a retailer with a quality product offered at a fair price point has a good chance of finding demand in markets across the globe.

Several factors are driving this surge in cross-border shopping. For one thing, as the Wall Street Journal reported in February 2025, e-commerce overall has benefited from its ability to outshine retail stores in terms of selection and convenience. Some consumers have grown tired, the report says, of arriving at a store only to learn that a desired product is out of stock but can be ordered online. A study by AlixPartners consulting firm found an average of just 9% of inventory was available in the stores it examined. As a result, consumers have become accustomed to what the Journal calls the “shopping nirvana” offered through e-commerce, where “we [can] order whatever we want from our couch.”

As retailers work to calibrate consumers’ expectations against the physical and economic realities of maintaining vast in-store inventories, e-commerce will continue to be an attractive alternative. Other trends driving cross-border sales include:

Emergence of global online marketplaces. Online platforms including Amazon, eBay, Alibaba and Temu provide businesses with easy access to consumers located throughout the world. This access has been especially appealing to third party sellers, which currently account for more than 60% of sales on major marketplaces.

According to Amazon’s 2023 Small Business Empowerment Report, most independent sellers on its marketplace are small-and-medium-sized businesses that have taken advantage of the opportunity to expand to new markets. More than 330 million items were exported by U.S.-based sellers during 2023, with products shipped to customers in more than 130 countries globally.

The world has never been more connected. According to research from Oberlo, the world had an estimated 2.71 billion online shoppers during 2024, which was 70 million more than the year prior. Consumer interest in online shopping is projected to increase as internet connectivity becomes more prevalent. Countries with the largest rates of internet usage include:

• • Saudi Arabia – 100%
  • United States – 97%
  • United Kingdom – 95%
  • Canada – 94%
  • France – 87%
  • Japan – 85%
  • Mexico – 81%
  • China – 77%
  • India – 43%
    Source: World Bank

Another part of the story though, is the significant number of people who remain without internet access throughout the world – and the tremendous potential to expand access to information and services. According to the World Economic Forum, more than 685 million residents of India are not able to access the internet, despite India having the world’s second largest digital population. Similarly, more than 582 million Chinese residents are not connected to the internet, at a time when PPRO reports nearly 980 million Chinese online shoppers.

Technology-based transaction advancements. While internet connectivity has expanded consumer access to online shopping platforms, additional technology-based solutions allow retailers to engage with customers, and offer seamless, secure transactions. A few notable developments include:

• • Digital wallets (i.e., Apple Pay and Google Pay) and secure payment processing capabilities. This includes payment integration services that enable payment in the buyer’s native currency.
  • Encryption capabilities that protect customer data and help prevent fraud.
  • Multilingual services allow retailers to offer websites in multiple languages.
  • SEO Optimization allows retailers to tap into geographic preferences and offer products likely to appeal to a customer based on those preferences.

Consumers increasingly favor a “global marketplace,” and cheaper products. In an analysis of Canadian consumer preferences, the S. International Trade Administration notes: “Although Canadians prefer to support Canadian online businesses, a sizable proportion of the nation’s e-commerce goes to non-Canadian websites. Various reports state that close to half of Canadian consumers’ online purchases are made at foreign retail sites.”

This assessment would seem to align with findings by McKinsey about the importance of price and selection in driving global cross-border attitudes. Key findings include:

• 60% of consumers cited “prices lower in foreign country” as a reason for making an international purchase.
• 36% said the desired product/brand was not available in their domestic market.
• 20% cited “cheap” delivery costs for obtaining an international purchase.

Historic number of Free Trade Agreements. Governments across the globe have also taken an interest in promoting cross-border trade. According to the World Trade Organization, as of January 2025, 373 regional trade agreements (RTAs) are in effect worldwide. While the specifics of each agreement vary, the cumulative effect has been to eliminate barriers, allow for duty-free trade, and encourage international investment.

U.S. and Canadian retailers benefit from the United States-Mexico-Canada Agreement (USMCA), which is the free trade agreement that eliminates duties on qualified goods and facilitates the customs clearance process, among other benefits. The agreement, which took effect in 2021, promotes cross-border e-commerce by offering incentives for low-value shipments. Specifically, shipments that meet each country’s “de minimis” threshold can avoid duty and tax payments as follows:

• Canada: Shipments entering Canada valued below C$40 are exempt from taxes. Shipments valued below C$150 are exempt from duties.
• United States. Shipments entering the United States valued at less than US$800 are exempt from duties.

The USMCA also establishes a new low-value shipment level of US $2,500 (C$3,300), which provides informal entry status to express shipments valued at less than that amount. Informal entry allows shipments to clear customs with minimal paperwork and documentation requirements.

Beyond the USMCA, the U.S. and Canada have free trade agreements (FTAs) in place that offer trade opportunities with other countries. Canada currently has 15 FTAs that provide access to 1.5 billion consumers worldwide, and more than 60% of the world’s GDP. This includes the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) which facilitates trade between Canada and more than 500 million consumers located throughout 11 other countries including Australia, Japan, Singapore and, most recently, the United Kingdom.

The United States has 14 FTAs in force that affect trade with 20 countries.

It would seem then, that the stars are aligned for U.S. and Canadian businesses interested in expanding to international markets. Consumers are willing to purchase from non-domestic retailers. The technology exists to enable high quality customer experiences. And customs obstacles can be managed for eligible shipments moving between “trade friendly” countries. The remaining piece of the puzzle then, is ensuring on-time deliveries across international markets, in a cost-effective manner that satisfies consumer expectations.

Many businesses have been challenged to solve this dilemma and as a result, have opted to avoid expanding to new markets. A better option though, would be to partner with a logistics provider with global reach that can offer targeted shipping options within a specific market.

Logistics providers have kept pace with demand for fast, reliable international service.

The surge in global e-commerce has accelerated demand for transportation and logistics services. This has resulted in a need for more capacity systemwide, including more vehicles and planes, more strategically located warehouses and fulfillment centres, and for workable solutions to quickly, efficiently, and consistently moving goods across borders.

Logistics companies have responded to this need by investing in new equipment, adding warehouse space, and adapting personnel and operating practices to accommodate the nuances of e-commerce shipping.

For example, with locations across Canada, Purolator recently invested in a new 445,000 square foot distribution facility that addresses the surge in e-commerce packages arriving in Canada. Located in Etobicoke, Ontario, the new facility relies on technology-based automation to process up to 70,000 parcels per hour, a rate that is 10 times the amount possible using manual efforts. In addition, trucks arriving at the facility are unloaded in under 10 minutes.

With this new facility, Purolator can manage the increased volume of parcels and maintain commitments to customers regarding on-time deliveries and efficiency. Consider for example, that on a single day – December 2, 2024 – Purolator processed more than 1.5 million pieces. And over four consecutive days that same month, the company received more than 1 million pieces per day. This speaks volumes about the facility’s ability to keep pace with the surge in packages arriving in Canada from all over the world.

Logistics companies have “risen to the challenge” in other ways as well.

End-to-end single-source providers. Savvy logistics providers have developed global networks that facilitate shipment pickups and deliveries worldwide. This allows a business to rely on a single logistics provider to handle all shipment needs, regardless of where in the world shipments are located or headed. This in turn means enhanced visibility and accountability and allows businesses greater control in ensuring customer delivery preferences are prioritized. For example, Purolator owns 97% of its assets which ensures more efficient deliveries with fewer handoffs and reduced risk of damage or loss.

Technology-based innovation. Logistics providers now offer supply chain solutions that were previously unthinkable. But thanks to technology, including artificial intelligence, many capabilities are now possible. Purolator utilizes AI for route optimization solutions that ensure shipments follow the most direct course. This avoids extra stops and wasted miles, and reduces each delivery’s carbon footprint. Another innovation, enhanced network visibility, allows a logistics provider to identify all options for a particular shipment, from which an ideal solution can be selected.

Access to extensive service portfolios. Businesses with international customers have diverse needs that require a broad range of services. This can include, for example, access to “mission critical” air services for time-sensitive or highly fragile shipments; “just in time” services to manufacturing facilities, medical offices, or retail locations; freight services to industrial locations; and e-commerce postal or courier services for residential deliveries. A truly capable provider will offer all, with flexibility within each category to ensure date-and-time-specific deliveries throughout the world.

Inventory segmentation. International e-commerce requires fast, reliable access to top-selling SKUs, and confidence that slower-moving merchandise can be easily located and transported when needed. This is accomplished with forward-looking strategies including advanced forecasting, strategic warehouse allocation, and in some cases by drop shipping, which allows a retailer to avoid holding inventory of certain products.

Omni-Channel. Experienced logistics providers now speak the language of omni-channel services, and allow retailers to meet consumers expectations that include:

• • BOPIS – Buy online, pickup in store.
  • BOSS – Buy online, ship from store.
  • BORIS – Buy online, return in store.
  • STS – Store-to-store transfers.

Returns management. Returns are an unavoidable part of doing business, and they can be especially problematic when an international border needs to be crossed. This is true both in terms of impact on the bottom line, and importance to customer satisfaction. Not every return warrants an expensive trip back to its country of origin, and a retailer must have a way to quickly fulfill requests for different product sizes or colors. Experienced logistics providers like Purolator have embraced the need for returns management and will customize a solution that addresses a retailer’s specific needs.

Last mile. Last mile services are the most important part of the delivery, regardless of where in the world the delivery occurs. Either a package arrives undamaged and on time, or it doesn’t. In its Canadian and U.S. market, Purolator prioritizes last mile efficiency through its extensive courier network, which ensures coverage to every province and territory, and access to just about every location, including remote job sites that don’t even have paved roads! Experienced logistics companies across the globe understand the importance of the last mile, and have invested in the necessary vehicles, technology, and equipment.

E-commerce allows retailers seemingly limitless opportunities to expand their businesses. Cross-border e-commerce takes those opportunities to the next level. This is largely possible because of logistics innovations that allow businesses to provide seamless delivery experiences regardless of where in the world a consumer is located. It’s an exciting time, and Purolator stands ready to help with innovative solutions that ensure on-time worldwide efficiency. Perhaps it’s time for your business to jump in and take advantage.

Written by Paul Tessy, Senior Vice President, Purolator International