Shipping Internationally: Secrets to shipping overseas without blowing your budget

These initial questions will help form your growth strategy for expanding internationally. That strategy should cover all aspects of international shipping, including:

· Shipping restrictions

· Shipping carrier and costs

· Customer shipping (and returns) policy

· Fulfilment

· Any additional duties and taxes

“It’s not uncommon for businesses to want to expand overseas before they are ready,” she cautions. “So, it’s important to think strategically for growth. Make sure it’s not your ego wanting to expand overseas, and that it’s a smart strategic move forwards for you and the business.”

STEP 1: Check country regulations

Before you ship a single package, check the regulations of the country to which you are sending it.

There may be restrictions or red flags relating to the materials your products contain, their use, or the quantity you’re permitted to ship. For example, if you’re shipping to the United States from Australia, you are not permitted to send animal products, including honey.

A good resource is the Australia Post International Guide, where you can search and view up-to-date restrictions by country, and the Australian Border Force guide, “How to Export”.   

You can also visit the individual government websites of the country to which you are shipping, to check for any prohibited items or items labelled as “dangerous goods” in that region. For example, if you’d like to ship to New Zealand, their government website clearly states their regulations and restrictions, or if you are interested in shipping to Germany, their government website has a section on shipping goods from within the EU as well as outside the EU. Often your shipping carrier can provide further assistance if you are finding this challenging.  

STEP 2: Choose a shipping carrier

There are a variety of international shipping options to choose – from your local in-country post company to larger global organisations such as FedX, DHL and Sendle. There are also a variety of medium-sized carriers that specialise in specific regions, such as Yodel in the UK, and PackSend in Australia. Or MyUS which specifically ships from the UK and the US to Australia.

It may serve you better to work with a variety of shipment partners for different products or regions; perhaps one shipping partner has competitive costs for shipping to the UK, but their prices for the US are more expensive than competitors. You may want to partner with one company for a specific region, and another for separate destinations, so that your prices are more competitive.

Aside from cost, some of the qualities to look for in an international shipping carrier include:

Their range of services

For example, can they plug in or connect directly to your website? Do they offer quality customer service and do they provide end-to-end tracking notifications for delivery?

Real-time tracking

Increasingly, customers want to track the progress of their goods. In the US in 2019, Dropoff courier services reported that 85 per cent of consumers will buy from a retailer again if they can track their purchases throughout the delivery process.

The shipping carrier type (overland, sea or air)

Some products are more suitable for particular types of travel. For example, shipping via sea can be cost-efficient but slow and unsuitable for perishable goods, whereas some products, such as fireworks, pesticides and aerosol cans can’t be sent by air.

Their company values

If you are a business that prioritises sustainability, you may want to partner with a carrier company that limits the environmental impact.

Their ratings and reviews

Check reviews from other small businesses – and customers, too.

STEP 3: Calculate shipping costs  

A recent study found that 48 per cent of consumers who abandoned their shopping cart did so because the cost of shipping was too high. So, reducing that cost is good business.

When you are calculating the total cost of shipping, include any packaging costs (including labels and tape), courier costs to collect the package, extra import/export fees, duties and levies you might be charged and, of course, cost of labour. To reduce those costs, look at reducing the weight and size of the box and try offering a range of carriers with different shipping times.

Calculating shipping costs also means researching duties and taxes. Many countries have enforced “De Minimus” values, which is the threshold at which you must start paying duty tax. For example, in Australia, that value is $1000AUD, and in the US it’s $800USD. Check De Minimis in the country you are shipping to with this table created by the Global Express Association.

STEP 4: Setting your customer shipping policy

Once you know your shipping costs, you’ll need to decide upon your customer-facing shipping policy. This will also need to align with the customer service offered from the shipping partner you choose. Some questions to ask are:

Will you offer “free shipping” or flat-rate shipping? According to Digital Commerce, 17.5 per cent of online retailers offer free shipping on all orders, and 65.4 per cent offer free shipping at least some of the time. For free shipping, the costs will need to be absorbed into your product pricing, so consider if this will make it a less attractive offer compared to your competitors? For flat-rate shipping, will that make your shipping prices seem high compared to competitors in some regions?

Could you offer a range of shipping fees? For example, some companies offer free shipping for standard shipping timings, but then charge for expedited delivery. You may also need to use two different shipping carriers for this, as not all carriers offer express postage timings.

How will you handle returns? Returns are an increasingly big issue for eCommerce businesses, especially in fashion, and you will need to clearly set out your policy on your website. Be aware that some countries have regulations about returns policies, for example in the European Union, you must accept a return in 14 days, whereas in Australia there isn’t an official time limit. For more information on this, UPS has a good shipping and regulations online tool.

STEP 5: Sourcing fulfilment partners

Another option to consider, either to save money or time, is sourcing a fulfilment partner in the country you are shipping to. A fulfilment partner is a third-party logistics provider who can handle your inventory for you, manage order processing and then also take care of shipping and delivery.

This can be especially time- and money-saving if your products come from another destination (for example, China) as they can be directly delivered to your fulfilment partner instead of being double handled.

This option can also reduce shipping times for the consumer as goods have less distance to travel. Most fulfilment partners will integrate seamlessly with your website and take care of everything from the moment of sale onwards (including in most cases, returns).

Recommendations and reviews, pricing, customer service strategies and the ability to offer inventory management infrastructure are all aspects to consider when choosing the right partner for your business and the region you are expanding into.  

STEP 6: Research product labels 

When shipping internationally, you may need to create new labels for your products. 

For example, if you’re shipping consumables, you might have to add specific ingredient or nutritional advice to your labels for certain countries. Or perhaps your product is called something different in another country. For example, napkins (Australia) are called serviettes in the UK, or soda (US) is often called fizzy drink in the UK, and soft drink in Australia.

This may make creating new labels a necessity, and while this doesn’t directly link to shipping costs, it will add additional costs to international orders – which will need to be factored into the overall product or shipping pricing.