Describes what a company needs to know to take advantage of e-commerce in the local market and covers prominent B2B websites.
E-commerce emerged in the 1990’s, but it was not until 2011 that it gained momentum in Guatemala. And due to the COVID-19 pandemic and the severe home quarantines decreed by the government, there was a change in the consumer habits shifting from store shopping to online shopping, and a growth in the preference of electronic payment. During 2021 a study conducted by the Guatemalan Chamber of Commerce showed that 5 out of 10 Guatemalans bought online in 2020. In amount of money, more than US$240 million dollars were billed nationwide. Also in 2020 international online sales grew by 60%, and local online sales grew 118%. Republic of Guatemala is using e-commerce not only within the private sector, but also within some government institutions that have launched web pages offering interactive services.
Culturally, Guatemalans prefer face to face engagements, but new generations are embracing technology and moving away from the traditional retail model. Businesspeople, associations, and the Government acknowledge that e-commerce is a very important electronic tool in doing business and during the current pandemic many stores have started to offer eCommerce. The latest data provided by Statista estimates that in 2022 revenues in the eCommerce market is projected to reach US$2,089 million, and the user penetration is expected to hit 41.7% by 2025.
Domestic e-commerce (B2C)
There is a trend of purchasing products from the United States, considering the ease of conducting business, and the well-established delivery companies found in Guatemala. Guatemalan consumers also buy from the European and Mexican eMarkets.
Some of the most popular products Guatemala purchase overseas are electronics, clothing, car spare parts, household items, gifts, decorations, books, online courses.
According to experts in e-commerce, the greatest challenges of buying from the U.S are:
- Some U.S. vendors only accept credit cards with a U.S. billing address
- Guatemalan Customs Authorities will open and verify all packages from the U.S. This practice is subject to the Customs agent’s discretionary rulings, and therefore some products may end up paying more import duties than they should.
- Despite the attractiveness and growth of e-commerce, Guatemalan consumers and small business, can still be reluctant to purchase goods and services online due to lack of trust in the system.
Another factor that concerns Guatemalans is the lack of information and certainty of privacy protections, personal identification information, and insecurity of online transactions.
As a result, some courier and delivery companies offer to pay customer’s purchases with their company’s credit card for a small fee (1-3% of the total purchase).
Larger companies have IT offices within their organizations to manage commercial services on their webpages. Others subcontract from local firms that specialize in developing and managing e-commerce sites. These companies will provide software to the hiring firm such as site-building tools and templates, database features and methodologies for best practices, plus transaction software.
Product supply and procurement exchanges represent another aspect of online commerce. These sites serve a range of industries and often focus on a niche market. A company purchasing agent can purchase supplies from vendors, request proposals and even make bids for purchases at specific prices. These B2B websites enable the exchange of product supplies and procurement.