International Shipping – A Guide For Businesses
Deciding to ship your products internationally is a big step for any business. The wealth of benefits is one of the main allures, ranging from reaching a wider audience to having more opportunities for growth in the future. Now, you no longer have to settle for just the customers that live in the same country as you. You can look at branching into many different markets while expanding on your current portfolio. Once you’ve chosen the ideal product, ensure there is an audience waiting for you in your chosen country and have decided that this is the next step for you, it’s important to consider international shipping.
Many of the clients we encounter are embarking on their first international shipping venture. Therefore, we understand that the entire process is complex and confusing to start off with. This guide will look to give you a clear and comprehensive insight into the things you need to consider, as a business, when shipping internationally.
Find an appropriate shipping carrier
When we post products here in the UK, we choose to either rely on Royal Mail or any of the reputable courier companies that are out there. In general, delivery times are easy to predict and even expected by many customers. Having a product delivered when you say it will be does a lot to impact your brand’s reputation. This is one of the reasons why choosing the right shipping carrier is important.
What does your customer expect?
With every business decision, the first thought should be to the customer. Are they likely to expect delivery times to be short? Is the product likely to be one that is needed asap or are they willing to wait? If your product is essential, it’s likely the customer will want it within a matter of days. If it’s more of a luxury, a few weeks would be acceptable for international deliveries.
If you have a premium product with a high price tag, you’ll need to supply a detailed tracking system. This should tell the customer where their package is at any given time, providing peace of mind.
Best practice: We recommend that you offer a range of delivery options to your customers, if possible. Allow them to pay a premium if the product is needed urgently or a more cost-effective choice if they are happy to wait. This gives you more flexibility, minimising the risk of complaints and compensating for the delays that can occur during international shipping.
Prepare all of your documents
To minimise delays and packages being stopped in customs, it is vital that you prepare all of your documents in advance. An experienced freight forwarding company or international shipping company can help you with this. However, as a bare minimum, you will need:
This is a declaration of the contents of any shipment. It will be used to clear your package for entry into the country and to determine the duty and tax owed. You will need to ensure that information about the contents of your package and the value of the items inside is declared here.
This is a legal document between the supplier of the goods (you) and the end-user (the customer). It clearly describes the items inside the package and the amount due on the customer. It is one of the main documents used when a parcel is cleared.
Best practice: Make sure you have 3 copies of the commercial invoice attached to your parcel in a clear pouch. This allows it to be removed easily by the customs officer without causing damage to the shipment.
Make sure you have all the correct and relevant information
The documentation you send along with an international shipment MUST be accurate. Incorrect or fraudulent information is one of the main reasons why a package will be held or seized. The essential information required includes:
- Accurate content information
There are 3 main categories to choose from – merchandise, sample and gift. If you attempt to pass merchandise or a sample off as a gift, you are essentially attempting to dodge import taxes.
- Your business information including name, address and tax reference number
- Information on who should be billed for customs duties and fees.
There are two options here – DDU and DDP. DDU stands for Delivery Duties Unpaid By Sender and indicates that the recipient will need to pay the outstanding fees. DDP stands for Delivery Duties Paid by Sender which indicates that you will cover these fees.
- Tariff Code (HS Code). These are universally used codes for global commerce. They are required for tax assessments purposes)
- Information needed by customs including a description of what is being sent.
Best practice: When describing the product you have shipped, be factual but precise. If a description is too long and vague, it will take longer to pass through customs.
Research customs, restrictions and duty
One of the most complex parts of international shipping are the fees that accompany it, namely customs and duty. It is also important to understand what restrictions there are on goods into and out of specific countries. For example, tobacco is deemed a ‘prohibited import’ into Australia as of July 2019 and electronic cigarettes cannot be imported into Bahrain.
The existing restrictions for most countries can be found online. Equally, an experienced freight forwarding company will also be able to provide this information to you.
For customs duties and fees, these are ever-changing. They are dictated by many factors from supply and demand, time of year and the current season. On occasion, these can even vary depending on the individual customs office that handles your shipment.
International Shipping Insurance
Most freight forwarding companies or international cargo movement businesses will offer a standard level of international shipping insurance with their services. This protects your goods during shipment and normally covers theft, damage and loss. If the product you are shipping is fragile or prone to damage or theft, you may need to consider adding a premium to ensure you are covered.
Dealing with international returns is highly complicated, and potentially costly, exercise. Not only will you have to pay additional customs and import taxes to have an item returned to you, but there is also no guarantee on how long this will take or what condition the item will arrive in. However, if you plan to post your products to various countries, it is something you will need to consider and plan for in detail.
Best practices: Create a policy that states your position on international returns. This can state that your business does not offer returns at all. Or, that the shipping costs and fees must be covered by the customer. Yes, this doesn’t help to uphold the same helpful strategy you can use in the UK but it will protect your business financially.
For more information on how to prepare an international shipment or advice on international fees, get in contact with Radius Warehouse and Logistic Services today.