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Tailwind for Estonian e-commerce solutions

Global pandemic continues to change how we work, how we learn, how we travel, and how we shop. Still, researchers and thinktanks predict that what we see are just the first steps. Especially e-commerce is expected to change permanently. Two Estonian companies Cleveron and Eurora Solutions are taking points in these new developments.

Delivering things to people is going through turbulent times. On the one hand, people reluctant or forbidden to leave their homes and contact others are ordering more things online. On the other hand, postal services are struggling to keep their employees healthy while keeping up with the increased demand. Some researchers predict a decrease in demand for non-essential goods combined with lower overall economic growth. Add in the environmental uncertainties, and you have a genuinely unpredictable concoction.

“We live one day at a time,” admits Arno Kütt, CEO of Cleveron, an automated pick-up lockers manufacturer, who has global commerce giants like Walmart and Zara as clients.

“But we are very well positioned to face the changing landscape. Estonia has the most pick-up robots in the world. This has enabled us to face the steep increase in demand for food-related e-commerce robots globally. As people are concerned about how their purchases are delivered to them without fear of catching the virus, we can offer them functioning and tested products.”

“Furthermore, we are currently testing our self-driving delivery robot in the real world. This machine can substitute employees who still have to contact people when delivering the goods to customer vehicles in front of supermarkets. Luckily Estonia is one of the few countries where this testing is welcome. So we are testing our robot right here, in Viljandi’s streets, my home town,” Mr. Kütt smiles.

True, Mr. Kütt also admits that companies tend to postpone long-term investments in an unpredictable economic situation. Furthermore, practical issues such as setting up robots in foreign countries with travel restrictions are a challenge.

“This means that we have to adapt, too. For one, instead of sales, we are offering our robots through service rentals,” Mr. Kütt continues.

“In terms of delivery and installment, we have implemented an augmented-reality-based process that will allow setting up our robots without traveling. We make use of our technicians who guide people through audio and video and augmented reality through glasses or tablets, which guides the technician to see, for example, which part goes where,” Mr. Kütt explains the process.

New regulations for international package delivery

While e-commerce grows, new regulations are influencing how the packages are handled internationally. In the EU, new regulations demand digital pre-declaration of VAT for all packages starting from July 1st, 2021. Because packages up to EUR 22 were exempt from VAT before, this would estimate 7 billion new declarations annually. Similar regulations are on the way to the US and elsewhere.

“Very few e-commerce companies, logistics providers, and even customs services are prepared for that because there are very few products that meet the demands of new regulations,” says Jaanus Vihand, CEO of Eurora Solutions (former Aurora Solutions), provider of e-commerce and logistics intelligence.

“We have one of the best… Well, no, this is so Estonian. I have to admit that we have the best product in the market,” Mr. Vihand corrects himself and smiles.

“We are providing automated declaration and HS codes for all links in the delivery chain. In the best case, our AI can be adapted to the e-shop where the customer makes a purchase. In this way, anyone who wants to sell to the EU can be sure that the necessary taxes are declared and paid by the customer without additional hassle. Eventually, everyone has to do it if they want to have customers in this region.”

One of the sources of quality for Eurora Solutions is close engagement with science institutions. In developing its AI, Eurora is working with TalTech and STACC, Estonian leading machine learning and data science. This means that both their AI and API are well-positioned to be integrated with the customer’s architectures.

Nevertheless, Mr. Vihand predicts some busy times ahead. “We are sure that somewhere in the spring, when the implementation deadline for regulation is approaching, we will see a wave of clients. From our end, we are ready to set up the system in 30 hours, but some older systems require up to 200 working hours of tweaking.”

Although the global business trends indicate fair sailing for both companies catering to the digital, both CEOs agree on one thing. They miss real, personal meetings. Let’s hope that growing e-commerce will leave more time for those in the future.

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