International eCommerce Logistics: PuntoMio Gets It Done

I first wrote about PuntoMio in a November post and, after doing more research, I continue to be impressed with their business model and how beneficial their offering can be for eCommerce companies that want to expand into international markets.   Recently, I had the opportunity to talk to A.J. Hernandez, PuntoMio’s COO, about the company’s history, business model and their goals for the future.

PuntoMio management’s has a 40-year history in international logistics, including such companies as SkyNet and SkyBox.  SkyNet is a leading logistics company for US merchants and Latin American consumers, which was sold in 2001 along with a customer base of 80,000.  SkyBox, another company formerly managed by PuntoMio execs, also partnered with various US merchants such as CDNow to deliver products to Latin American consumers via catalog and fax.   Mr. Hernandez stated that it is PuntoMio’s expertise and success in the international logistics business that drove them to pursue partnerships with US eCommerce vendors.  The strategy of leveraging their core logistics expertise while enabling Latin American consumers to purchase American brands on the web is fueling PuntoMio’s growth — and has them eyeing other markets, as well.
Founded near the end of 2009, PuntoMio enables Latin American consumers to purchase products that are not available outside of the US, or for those that are, the prices are lower than purchasing identical products locally.  The service essentially works by providing Latin American consumers with a US address that is provided to the US-based eCommerce vendor.  The product is shipped to the US address (at a PuntoMio distribution center) and then forwarded to the end consumer.

“Clothing and Electronics are the biggest sellers”, Hernandez mentions, “with Argentina being the strongest fashion market while Brazil leads in electronics purchases.”   Hernandez also mentioned that Venezuela is a growing market for American fashion brands and Mexico is a strong market for US electronics.  So why do most US eCommerce vendors continue to ignore these markets?  This goes back to the borders issue that I’ve been writing about for the past few months and the difficulty in navigating all the complexities of international trade law, multiple languages, customs, duties and delivery in other countries.  This is a difficult business problem and it’s quite impressive that PuntoMio seems to have solved this so completely for their target markets.  Solving these challenges have led to some of PuntoMio’s biggest differentiators of return handling, direct home delivery and local call centers in each Latin American market.

Having navigated through most of the PuntoMio purchase process, and having some experience in purchasing from other countries, I wasn’t too surprised at the fees, but for those that are unfamiliar with the costs, here is a breakdown of estimated costs for shipping a $500 digital camera to an address in Rio De Janeiro:

  • Shipping Cost: $76
  • Duties: $300
  • Insurance: $6

The total for the camera and all additional charges would be $882.  While that may seem like a lot, this is less than the same product can be purchased in Rio, if it’s even available.   In Brazil in particular, due to the relative strength of the Brazilian Real and to high tariffs in general, American goods can often cost double what they cost in the US.  With PuntoMio, Brazilian photographers begin capturing a nice discount in addition to digital images!

So how does an eCommerce vendor get signed up with PuntoMio?  According to Hernandez, the process takes anywhere from 60 to 90 days and this is primarily due to the complexities of software integration.  For eCommerce vendors that want to expand into the Latin American market this provides great opportunity with a partner that understands the logistics and legality of international commerce.

PuntoMio has met with such success by offering US eCommerce vendors a pathway into Latin America that they will be able to offer the same service for companies in the EU, via a London-based PuntoMio address with plans to expand into non EU countries in Europe in the near future.

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