Sales at online retailers operating in Finland grew by 5.1 percent in the first quarter and 5.2 percent in the second quarter compared to the previous year—faster than the retail sector as a whole. According to the latest E-commerce Pulse report, e-retailers’ growth expectations remain strong, but international expansion is being overshadowed by geopolitical uncertainty and the EU’s new packaging regulations.
According to the latest “Verkkokauppapulssi”* report from Digital Commerce Finland, the Finnish Specialty Retailers Association (Edu), and the Finnish Commerce Federation, online sales in Finland grew by 5.2 percent year-over-year in the second quarter. At the same time, total retail sales grew by 3.6 percent, according to Statistics Finland.
Part of the growth in online shopping can be attributed to the fact that more adults are making digital purchases than before: 77 percent of the adult population reports having made online purchases, whereas at the beginning of last year, that figure was a couple of percentage points lower. Another factor driving this growth is the increase in overall purchasing power, which is also reflected in online shopping.
“The decline in the popularity of Chinese websites during the spring and summer is also evident: at least some online shopping appears to have shifted to stores operating in Finland,” said Jaana Kurjenoja, chief economist at the Finnish Commerce Federation.
Online retailers’ expectations for domestic sales growth remain high. Just over a third expect very rapid growth—even exceeding 10 percent—over the course of the year, while 45 percent expect slightly more moderate growth.
Expectations for growth in exports have strengthened since the beginning of the year, but remain below last year’s level.
“Ongoing geopolitical uncertainty and the unpredictability of tariff policies have clearly dampened expectations regarding opportunities in international markets,” says Mirva Sandström, director of Digital Commerce Finland.
European Union regulations are also currently seen as hindering the growth of cross-border sales. In particular, the EU’s new Packaging and Packaging Waste Regulation (PPWR) is causing concern. In the open-ended responses to the business survey, some online retailers even report that they have temporarily suspended sales to certain EU countries until the impact of the new regulations on their own operations becomes clearer.
“The growing administrative burden undermines the ability of small, specialized online retailers in particular to expand internationally and compete with large international players,” says Jenni Homer, CEO of the Specialty Retailers Association (Edun).
* The E-commerce Pulse is a quarterly market survey of the e-commerce sector. It combines data from a business survey with information from various sources to provide an overview of trends in the Finnish e-commerce market. Typically, about 100–200 companies respond to the survey.
Online retailers who responded to the survey will receive a separate “Online Retail Pulse” report.
Jaana Kurjenoja, Chief Economist of the Finnish Commerce Federation, is responsible for producing the report’s content.
For more information:
Mirva Sandström, Digital Commerce Director, Digital Commerce Finland
Tel. 0400 984 141, mirva.sandstrom(at)digitalcommerce.fi
Jaana Kurjenoja, Chief Economist, Finnish Commerce Federation
Tel. 040 820 5378, jaana.kurjenoja(at)kauppa.fi
Jenni Homer, CEO, Specialty Retailers Association ETU
Tel. 040 900 6389, jenni.homer(at)etu.fi
Digital Commerce Finland is a digital commerce community and a community-driven company that helps the digital commerce sector grow faster. The community’s activities include free training sessions for online stores, the eCom Summit & Awards flagship event, data services, club activities, and a shared physical meeting space for digital merchants. www.digitalcommerce.fi
The Finnish Commerce Federation is the voice of the retail sector—the largest industry in the Finnish economy—in society. We bring together the entire sector, from retail and wholesale to e-commerce. We negotiate collective bargaining agreements for the retail sector and advocate for business policy solutions. We work to ensure that Finnish retail and services thrive and succeed in the face of fierce international competition. www.kauppa.fi
The Specialty Retail Association (Etu) helps specialty retailers succeed, both in Finland and internationally. Founded in 1920, the Specialty Retail Association represents 13 sectors in the retail and health industries. The association’s member organizations include more than 900 companies that employ over 40,000 people. www.etu.fi
