The competition between EU states to draw corporations who operate across borders, intensified somewhat in recent years. Now, countries like Malta, Hungary, Cyprus and Andorra all provide highly attractive options to businesses - and the main question we all ask: how will U.S. and G7 tax plans affect these countries?
By assessing the way web businesses perform in countries like Malta and Hungary, some interesting facts comes to light: 2020 was by far one of the best years of trade for eCommerce around the world. As the surge of the pandemic closed in, more and more businesses were looking for fast, viable, and trustworthy solutions that can easily adapt to the modern market. In Hungary, the latter is the same, where the country saw one of its biggest spikes in eCommerce trading, adding nearly US$1 billion to its economy, placing it ahead of Kuwait and the Caribbean.
Research published by the University of Miskolc, the largest university in Northern Hungary revealed that with an 18% growth rate, eCommerce or web businesses are the engine of retail trade in Hungary. With the recent boom in eCommerce or web business in the country, Hungary is looking towards making some significant changes in tax-reform for web businesses, improving transportation services, and adding more jobs to the economy through web-based businesses. Government efforts are now making it easier for many business owners to rather move away from traditional brick-and-mortar stores, and focus on expanding the eCommerce industry.
What are trends for web businesses in 2021?
In Malta, the gaming sector is entirely online and represents a special segment in ecommerce: one which grew almost 10% in 2020. As for Hungary which has a larger population and less foreign demand than Malta at present: compared to 2020, data showed that 46% of the Hungarian population bought at least one item online. Although the pandemic could've been the biggest factor that influenced this data, new trends are slowly but surely emerging.
Bigger online stores
One of the key drivers for web businesses in Hungary is growing support from all areas in the country. Although this is possible, in bigger metropolitan areas, those living in rural neighborhoods, or villages have found it to be much easier to shop on one of the three biggest online retailers in Hungary. Compared to other online stores in the country, these three have stood out the most, bringing in millions in annual revenue.
These three contenders are making it easier for the overall web business industry to grow faster, but can create other challenges for smaller, and more independently owned businesses. Other competitors in the market are, edigital.hu, and auchan.hu with revenues in the high US$60m respectively.
Website builders taking over?
The race is on to provide the best website builder in the world. According to TRUiC, at least 5 global corporations are seeking to constantly redefine this space. It can be argued that companies like Godaddy and Wix are quite aggressive when it comes to pushing solutions for entrepreneurs who do not quite understand ecommerce technical requirements.
5G Technology and software automation services
One thing that has caught on rapidly around the world is the use of 5G technology, and software automation services for web businesses. The use of 5G enhances the experience, making it easier, faster, and more convenient for shoppers to quickly move between pages, and apps.
On the other hand, software automation services that use Artificial Intelligence are making it easier for shoppers to find products, and search through online catalogues. More so, the use of AI is pushing the web business industry to become more predictive in what clients want, and how the market fluctuates during times of economic uncertainty.
Online payment systems
Many EU web businesses have seen a change in the way people want to pay. The use of Visa cards, and traditional bank accounts have left many people feeling skeptical when shopping online.
A trend which is definitely worth watching, is to implement more than one payment method for web businesses. This can include PayPal, Skrill, Xoom, and even paying with cryptocurrency. Throughout the world, many banks and traditional financial institutions are looking to update payment methods, both online and in-person. Additionally, these online payment systems should be integrated with mobile devices, and eCommerce apps to enhance the overall shopping experience.
Ease of business formation
The U.S. is competing tightly with EU states to be the jurisdiction of choice for corporations. While major changes may be seen for some new business formations in various sectors, government efforts to make it easier to do business online has seen more and more LLC Formation taking place in recent years. Some industries that have managed to garner the most growth are gaming, content marketing, online teaching, crypto trading, and businesses in the software and technological development industry.
Some EU states are quickly shaping up to bring changes, and set the trend for new ways of web business in the country. Having ease of trade between other nations, and allowing for the progressive move towards modernization of entire economies, web business in many states will only increase in the months ahead.
Brought to you by TRUiC