Sooner or later, every creative business owner comes to a super exciting point: their first international order. With marketplaces like Etsy and social media platforms like Instagram that allow us to market and sell globally, chances are very high that you’re going to have international customers, even without marketing to them proactively. Sometimes, it also happens due to other circumstances. Kiri Ostergaard Leonard, a freelance illustrator who is originally from Denmark and now resides in the US, knows this first hand. “[Selling internationally] wasn’t a conscious decision; it just happened because of how my life evolved. Immigrating to another country, I naturally didn’t want to sever ties with my network in my home country of Denmark,” she explains.
No matter the reason, at some point you may want to proactively market your business to international customers. For US-based sellers, marketing to European customers is often the first step when making an effort to sell overseas. It helps to understand the size of the market and what European customers are looking for.
How big is the European crafting market?
The European Union (EU), with its 28 member states, has 508 million inhabitants, with Germany, UK, and France being the biggest countries in terms of population. The UK crafts market alone is estimated to contribute $961 million to the UK economy per year, according to research by the Crafts Council UK. The overall market for craft supplies in Germany is estimated to be around $1.4 billion per year and, according to a recent study by the Initiativkreis Handarbeit, about 18.5 million people in Germany worked with yarn and fabric at home in 2016. Dawanda, an Etsy-like marketplace with a strong focus on Germany, increased its gross merchandise sales by 29% in 2016, compared to 2015 — a strong indication that the crafting market in Germany is thriving. While the European crafts market is still significantly smaller than the US market, its size is far from negligible and it’s growing.
What are the current crafting trends in Europe?
Over the last few years, several trends that originated in the US have made their way to the crafting scene in Europe. First, European customers are increasingly interested in where their craft materials come from and how, and under what conditions, they are produced (particularly yarn and fabrics). Storytelling about your product will be important, especially if you have a unique creative process or interesting raw materials. And second, it’s important to learn about and respect the craft traditions of the various countries you’re looking to expand into. There’s a trend towards recognizing a country’s rich crafting history and incorporating it into the work, especially in Scandinavia–think traditional knitting patterns updated with a modern fit. Research the textile and fiber heritage of European countries, respect it, and explore new ways to use it in your designs and product offerings.
Except for the UK, English is not the primary language in any European country. While many people under age 45 speak and read English quite well, this is not a given in every country. Older crafters are often a bit hesitant when it comes to engaging with creative businesses that market in a language they’re not confident in. One way to overcome this is to translate your product descriptions (and maybe even your website) into a few different languages – e.g., German, Swedish, and French. Another option is to use a local marketplace that offers localization and translation services, like Etsy or Dawanda, to sell your products.
Maria Tusken, of Tuskenknits, began her foray into selling internationally via her Etsy shop.
“International customers are really great at communicating and asking questions. It’s expensive for them to order products from the US so sometimes they ask to combine orders. I often build up a good relationship with them through emails,” she says.
Tusken is now running a yarn club and has taken steps to make it especially friendly towards European customers. “I have tried to make my yarn clubs more accessible to those in different time zones by having two different sign-up times to choose from,” she says. Time zones can be especially important when doing shop updates or launching a special collaboration that you know is going to sell out fast. To avoid disappointed customers, set up a few different shop updates or reserve a bit of product to put online later.
Most European countries use the Euro as their common currency, with two notable exceptions: the UK and most Scandinavian countries. Selling in a different currency is usually not a problem if you’re using a shop system or an online marketplace, like Etsy or Dawanda, but be aware of the exchange rates and how they impact your revenue and profit.
Europe uses metric weights and measures, so including those in product descriptions is key when selling internationally. Be sure to update anything else that might have measurements on them to include both metric and imperial units, be it yarn labels, sewing pattern instructions, or your shipping confirmation.
While the EU has joint trade agreements, customs can still differ from country to country. This is mainly due to different tax exempt amounts and the Value Added Tax (VAT) rates. Make sure you always declare your products correctly so they don’t get stuck in customs. Consider having an overview of the different tax exempt amounts and VAT rates ready in case a customer asks you about them.
“I was so surprised to learn how much most countries charge in customs,” says Tusken. “When I traveled to the Edinburgh Yarn Festival in March, I was able to meet up with a few customers and deliver their orders to them in person. Not only was it wonderful to get to meet them, but they were also incredibly grateful, as this saved them a huge amount in customs charges,” she says. “I have heard of some US sellers that will mark the package as a “gift” on the shipping label to help with these fees, but if I did that I should technically not be accepting payment or claiming it as income on my taxes. Though I would love to save my customers some money, this still feels dishonest to me. And as far as taxes go, I think it’s important to be honest for the sake of our businesses.”
If you sell digital goods such as patterns or ebooks to European customers, you’ll need to collect and remit VAT quarterly. The Taxamo plugin works well if you have a WooCommerce shop on WordPress. Other sellers use Payhip or sell on marketplaces such as Ravelry and Etsy which collect and remit VAT on behalf of digital sellers.
Shipping internationally can be incredibly expensive. Research the different shipping options and carriers in different countries to ensure you’re not undercharging and losing money, especially if you offer flat-rate shipping. Many US-based companies choose to work with European distributors to reduce shipping costs for their retail customers. The main European distributor for sewing patterns, for example, is Hantex.
Allie Tate, from the print-on-demand fabric company Spoonflower, spearheaded the opening of a branch in Europe to reduce the burden of shipping and taxes.
“We decided to open shop in Berlin, Germany, to better serve our existing European customer base and also grow our European community. By shipping from Berlin, our customers enjoy quicker shipping times and lower costs,” she says.
“We can also charge VAT up front, eliminating long trips to the customs office. We’re working on internationalization of the website that already includes some pages in German and the ability to pay in different currencies. We are continuing to translate the site and make the shopping experience better for our community outside of the US,” Tate says.
Tate points out that sometimes more subtle touches can make a big difference when selling internationally as well. “From my experience as a native North Carolinian living in Germany and working to internationalize Spoonflower, the key differences are the obvious ones, like language, currency, and measurement units. And while these are super important and not so easy to change, it’s also the little details that make an impact. When marketing to people outside of the US, we want it to feel authentic and localized — it is very important to know the typical way of communicating and remember that the direct translation may not be the best option and may not even make sense.”
Although there are some hurdles to jump over, taking your business internationally can not only be a great way to expand your customer base, it can also provide a fascinating learning experience and a myriad of new relationships.
Hanna Lisa Haferkamp
Hanna Lisa is a coach for creative business owners, project bag designer and co-founder of the independent knitwear publisher making stories. She loves knitting, writing, and working with other female creatives on making this world a better place. If you’re curious, you can find out more about her on her website, Etsy, and Instagram.