Logistics. A central position between strong markets such as Germany, Poland, Austria, but also nearby Hungary, means the country pretty much plays a key role in European logistics. Transport is well-functioning in the Czech Republic, a significant variable to Czech e-commerce growth. Pioneers such as Zasilkovna, Rohlik or Dodo proved that things can work both in cities and villages, especially post-2020, which made traditional players such as the Czech Post or couriers like PPL, DPD (the three most popular in the CZ), DHL, GLS or UPS really up their game. Interestingly, Zasilkovna (33%) has outran the Czech Post (26%) in terms of parcel amounts shipped. No wonder it’s owner, Packeta Group, doubled its revenue in 2020: it leads both Czech B2C e-commerce as well as re-commerce (P2P).
Legislation / administration.Administration and red tape is a bit more relaxed here (compared to Hungary, for instance). Make sure you´re following the laws and the tax best practices, and local authorities let you live freely. Also: first invoices in an Excel sheet should not be a problem. VAT registration is compulsory after hitting 1,000,000 CZK (38,200 EUR) in 12 consecutive months. The standard VAT is 21%, reduced 15% rate applies on transfer of certain residential houses, on certain foods, gas, waterway, accommodation, air transport of passengers or cultural activities. There’s reduced 10% VAT on pharmaceuticals used for health care, nappies, printed books and periodicals.
Payment methods is another field that has undergone shifts and changes in 2020. Pre-covid, cash on delivery was decreasing yet still quite popular, whereas now less than 15% pay with the actual cash (the predominant narrative in the pandemic is to maximize contactless delivery). Over 40% opt for a card payment, 18% uses bank transfers, 7% card on delivery and 11% card or cash at the store. Similarly, mobile shopping experienced a significant boost. Czech online stores report almost the same turnover from mobile (47%) as they do from desktop (49%).
Delivery. An increasing usage of pick-up points is noticeable all across the Czech Republic, not only in big cities. Zásilkovna, WeDo, PPL and other services have turned brick and mortar shops into pick-up points (before Christmas 2020, 45% of Czechs preferred this delivery method, according to APEK e-commerce chamber). Furthermore, pick-up boxes built by Alza, Mall and Zasilkovna are populating every corner of big cities, as well as targeting villages. Opened 24/7, accessible by phone and some of them working on sustainable, solar energy, they are here to stay. With that said, traditional home delivery by Czech post (remains popular out of habit) or DPD and PPL with extended evening delivery is still used, especially when unprecedented amounts of population work from home.
Candid insights before we go on:
Are you not only about seizing the day in business, but also thinking long-term? All pointers show the Czech market will remain in lead for the years to come, shaping the overall picture the CEE e-commerce will take. It only makes sense to be at the actual source, doesn´t it?
“For export players, it might also be a gateway to the West. The Czech Republic is a great place to test your product-market fit at a reasonable cost level before entering western countries such as Germany, UK, France or even Austria, where exploration can cost you significantly more,” Growww Digital´s co-founder László Szábó experienced.