December 20, 2023: ECAT eCommerce S.R.O. commenced operations in the Czech Republic.

As ECAT eCommerce, we proudly announce another significant step in our development journey – the expansion into the Czech market. As we mentioned in our previous article ‘ECAT eCommerce in the Czech Republic – expansion and development prospects in the dynamic e-commerce market,‘ our company continually strives to realize its goals and plans. We are a Polish company specializing in online trade, already achieving success in the Polish market. Now, we are opening a new chapter in our business by establishing ECAT eCommerce S.R.O. in the Czech Republic, which will serve customers from both the Czech Republic and Slovakia.

We are delighted to inform you that today, December 20, 2023, we have opened our company in the Czech Republic, ECAT eCommerce S.R.O. The opening of this company is a strategic step for us, expanding our operations beyond the borders of Poland and opening new opportunities for our company’s development. With our experience and knowledge gained in the Polish market, we are ready to meet the challenges and seize the new opportunities that the Czech market offers. We look to the future with enthusiasm and optimism. The newly opened company will contribute to increasing value for both our customers and our company.

Evaluation of the e-commerce market potential in the Czech Republic.

The opening of the new company, ECAT eCommerce S.R.O., was prompted by information about the market size, developmental trends, key players in the market, and the market’s specifics, where there is no dominant player, and the analysis of factors that may influence further development in the Czech market in the coming years. Here are some facts on this topic.

Dynamic growth of the e-commerce market in the Czech Republic.

The e-commerce market in the Czech Republic is one of the fastest-growing in Central Europe. In 2023, the market value reached $16.8 billion, representing a 17% increase compared to the previous year. Meanwhile, in 2024, it is expected to reach $18.5 billion, and in 2025 it is projected to reach a value of $20.8 billion. This is the fastest-growing e-commerce market in Europe (according to the 2019 Global Payments Trend Report). Forecasts indicate that the market will continue to grow dynamically in the coming years.

E-commerce turnover in the Czech Republic accounts for about 13.5% of the total retail sales in the country. (according to: https://www.ceska-ecommerce.cz/). This shows that the Czech market still has enormous potential. No wonder more and more e-shops are entering the Czech market to sell their products.

The number of e-commerce stores in the Czech Republic is continually increasing.

In Poland, as much as 64.6% of online sales are made through the Allegro service. In the Czech Republic, however, this market is dispersed, and sales are made through domestic online stores, of which there are currently about 51,000 (according to data from https://www.ceska-ecommerce.cz/). According to 2023 data, in Poland, there are 1.3 e-commerce stores per 1000 inhabitants. In the Czech Republic, there are as many as 5 e-commerce stores per 1000 inhabitants.

Among the most well-known and recognizable online stores operating in the Czech Republic, which include both small one-person shops and large e-commerce platforms, we can list:

• Alza.cz – the largest online store in the Czech Republic, offering a wide selection of products from various categories, including electronics, RTV/AGD, clothing, groceries, as well as services.
• Mall.cz – an e-commerce platform offering products from various categories, including electronics, RTV/AGD, clothing, groceries, as well as services. Decathlon.cz – a sports store
• CZC.cz – a store with electronics and computers
• Rohlik.cz – an e-commerce platform offering grocery products, including fresh products, canned groceries, frozen products, as well as ready-to-eat products.

MarketPlace in the Czech Republic

Marketplaces are becoming increasingly popular in the Czech Republic, as they offer sellers the opportunity to reach a wider customer base. Marketplace turnovers in the Czech Republic in 2023 could range from $6.3 to $6.5 billion. This is 39% of the total value of the e-commerce market. This means that the growth compared to the previous year is 20%. The planned turnovers in 2024 are expected to reach even $7.5 billion.

The marketplace market in the Czech Republic is diverse and competitive, with a strong presence of both international e-commerce giants and the growing presence of developing local companies. Local marketplaces play a key role, adapting their offers to the specific needs and preferences of Czech consumers, while international platforms attract customers with a wide assortment and competitive prices. Here are the leading players in this market:

International e-commerce platforms:

• Amazon: As a global leader in the e-commerce industry, Amazon also has a significant presence in the Czech market, offering a wide range of products and advanced logistic services.
• Allegro: Originating from Poland, the Allegro platform has expanded its operations to neighboring markets, including the Czech Republic, offering competitive prices and a variety of products.
• AliExpress: Part of the Chinese giant Alibaba, AliExpress, is popular among Czech consumers for its wide selection of products and attractive prices, though delivery times may be longer.

Local marketplaces:

• Alza.cz: One of the leading Czech marketplaces, known for a diverse assortment, competitive prices, and high-quality customer service. With turnovers of $2.3 billion, it is a key player in the market.
• Mall.cz: Another important local player, offering a wide range of products, from electronics to clothing and household goods.
• Rohlik.cz: Focuses on food and grocery deliveries, offering fast delivery and fresh products, making it an important player in the e-grocery sector.
• Heureka.cz: Although initially known as a price comparison site, Heureka has expanded its services, offering its own marketplace. It is an important tool for consumers to compare prices and products.

Characteristics of the Czech market conducive to development.

The Czech market is characterized by several unique features that distinguish it from other markets in Central Europe:

• Balanced competition: The Czech market is a balanced market, where there is no one dominant player, unlike some other regional markets, such as the Polish market with Allegro at the forefront. In the Czech Republic, market shares are more dispersed among various players.
• Presence of local leaders: Alza.cz, as one of the market leaders in the Czech Republic with turnovers of $2.3 billion, is an example of a strong local player that understands the needs and preferences of local consumers well. The presence of such companies indicates strong local market dynamics.
• Significant turnovers of other marketplaces: Although Alza.cz is the leader, other e-commerce platforms also achieve significant turnovers, indicating healthy competition and diversity of offers in the market.
• Preferences of local consumers: Czech customers value high-quality customer service, transaction security, fast deliveries, and local language and cultural aspects. Platforms that adapt their services to these preferences have a greater chance of success.
• Innovation and technological adaptation: The Czech market is also characterized by openness to technological innovations and rapid adoption of new solutions in e-commerce, favoring the development of more advanced and diversified services.
• Development of international brands: In addition to strong local players, the Czech market is also open to international brands and online stores, indicating the globalized nature of the Czech e-commerce market. (Data from 2021 – 6% of customers shop abroad, plus an additional 45% shop both domestically and abroad)

Why do Czech customers buy online?

The Czech Republic has a population of about 10.5 million people. 78.5% of Czechs over the age of 16 declare that they use the internet, with over half of them making purchases online. The majority of these online shoppers are women. Czech customers primarily choose online shopping due to:

• Convenient shopping and a wide assortment: Czech consumers appreciate the ability to shop from home, which is especially important in today's fast-paced life. Online shopping platforms also offer them access to a wider range of products, often unavailable in traditional brick-and-mortar stores.
• Price comparison and bargain hunting: Czechs are inclined to compare prices and look for the best deals online. High price awareness and the ease of comparing different products online make online shopping attractive for them.
• Quick deliveries: Growing expectations for rapid delivery are a key factor in purchasing decisions. Czechs are increasingly accustomed to 24-hour delivery standards, which is important for online stores to maintain competitiveness.
• Quality of customer service and website reliability: Czech customers expect high-quality customer service and the security and reliability of online stores. Shops that offer not only high-quality products but also efficient service and secure transactions are more preferred.
• Language and local preferences: Adapting websites to local language and cultural preferences is crucial. Czech customers are strongly attached to shops with a national .cz domain and prefer to shop on such websites. They pay attention to precise product descriptions, free of language errors. This increases their sense of trust and belonging.
• Accuracy and honesty of information: Accuracy and transparency of information about products, their availability, and delivery time are essential for building trust and customer satisfaction.

Reasons for the decision to open ECAT eCommerce S.R.O. in the Czech Republic

Fundamental facts and growth dynamics. The decision to open ECAT eCommerce S.R.O. in the Czech Republic stems from the continuous development of the e-commerce market in the country. Forecasts indicate significant sales growth in the coming years. The Czech Republic, with its growing digital economy and advantageous geographical position, offers unique opportunities for e-commerce development. Additionally, the proximity of the Czech and Slovak markets creates a dynamic trade area attractive for expansion.

Key factors for entering the Czech market with ECAT eCommerce S.R.O.

• Experience in Poland: ECAT eCommerce has been operating in Poland for years, with an extensive infrastructure and experience in customer service.
• Collaboration with Manufacturers and Wholesalers: Entering the Czech market will enable collaboration with local manufacturers and wholesalers.
• Expansion Opportunities through ECAT eCommerce S.R.O.: Opening the company provides the possibility of expanding into neighboring markets, including Slovakia.
• Manager 3.0 Software: We have tools that enable the connection of wholesalers and manufacturers with store operators, extending our operations beyond Poland.

Why are we entering the Czech e-commerce market with ECAT eCommerce S.R.O.?

• Easier logistics and collaboration: ECAT eCommerce S.R.O. is already operationally active in Poland, facilitating logistics and collaboration with Czech manufacturers, wholesalers, and the use of these goods for sale in neighboring countries originating from the Czech market.
• Product distribution: Establishing cooperation with logistics companies in the Czech Republic will facilitate the distribution of products both from Poland to the Czech Republic and from the Czech Republic to Poland and other countries. It also opens the Slovak market, as the Czech Republic and Slovakia are very close and tightly connected in terms of cooperation between markets, essentially forming one large market in terms of logistics and contracts between logistics companies from these two countries.

Benefits of opening ECAT eCommerce S.R.O. in the Czech Republic

Opening ECAT eCommerce S.R.O. in the Czech Republic will enable us to:

• Increase reach: Opening the company will allow for the expansion of operations into the dynamically developing Czech and Slovak markets.
• Reduce logistics costs: Local operations facilitate logistics management.
• Expand product offerings: The ability to distribute products from Czech manufacturers.
• Expansion into new markets: Opens the possibility of entering the Slovak market.

Prospects for further development of our company ECAT eCommerce S.R.O. in the Czech Republic.

With our experience in Poland, we transfer proven methods of operation to the Czech market. Cooperation with Czech manufacturers and wholesalers will facilitate our access to high-quality goods that we can distribute not only in the Czech Republic but also in neighboring countries. Establishing partnerships with logistics companies in the Czech Republic will significantly streamline product distribution throughout the region.

Also, establishing cooperation with logistics companies in the Czech Republic will facilitate the distribution of products both from Poland to the Czech Republic and from the Czech Republic to Poland and other countries. This also opens the Slovak market, as the Czech Republic and Slovakia are very close and tightly connected in terms of cooperation between markets, essentially forming one large market in terms of logistics and contracts between logistics companies from these two countries. As for the Czech Republic, the Manager 3.0 system will enable operational entry and sales based on goods originating from the Czech Republic.

Summary. ECAT eCommerce s.r.o. enters the Czech market.

In summary, our article about the entry of ECAT eCommerce S.R.O. into the Czech market focused on presenting our expansion plans and analyzing the potential of the e-commerce market in the Czech Republic. As a company with successes in the Polish market, we see a significant opportunity for development in the Czech Republic, especially considering the dynamic growth of this market and its unique structure with dispersed competition. Our experience and knowledge gained in Poland will allow us to effectively respond to challenges and seize new opportunities offered by the Czech market. We believe that the opening of ECAT eCommerce S.R.O. in the Czech Republic is a strategic step towards further growth and success of our company.”

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