Cross Border Shipping 101
As an online merchant, cross border shipping can be a little terrifying. What’s up with customs? Why is shipping across a border so expensive? Where did these zillions of shipping carriers come from?
It can be tempting to stick to shipping to customers within your own borders and call it a day. But if you’re not shipping cross-border, you’re likely missing out.
Not long ago, we went over a whole slew of reasons why you should be shipping internationally. This includes all the usual suspects like “the market is out there,” and “your competitors are doing it,” but we think the whole list is worth a read.
So if you’re sold on cross border shipping, but have no idea where to start, we’re here to help.
Choosing Your Products and Market
Much of your cross-border shipping experience is going to depend on where you are shipping and what products you are sending to customers. It’s a good idea to test your international shipping strategy by dipping a toe in the water before diving in.
Choose your market
Chances are you already know where your products are in-demand. Online shoppers are not always shy about attempting to have an order shipped internationally or writing into support to ask you to support their country.
Take a look at your store’s analytics. Do you get a lot of traffic from a certain country? Is your support team constantly fielding queries asking why you don’t ship to Region X? Then start there, where you know your products are already in demand.
Offerings like ShipperHQ can provide you with detailed analytics on the conversions you are not making internationally, which can give you some insights into the size of the opportunity.
Alternatively, you can choose to test the waters with a close market with long established cross-border shipping routes. In the U.S., that could mean Canada or Mexico. In the UK, that might mean the EU/Continental Europe.
Choose your products
Once you’ve chosen your market, your next step is to pick the products you want to ship internationally. We recommend starting with small, light and durable items. These types of items are less likely to run into snafus when making stops in the international shipping process.
But before you pack up a shipment of lithium ion batteries wrapped in U.S. postage stamps and send them on their way, there are a few things you need to know.
Country or Territory Regulations
International shipping between countries is highly regulated for all kinds of reasons. Before you lovingly plaster a label on your first international shipment, read up on the rule. UPS has a handy resource where you can look up shipping regulations and restrictions based on point of origin and shipping destination. Some countries may require that you obtain a license or other special provision before importing goods. For example, you need extra permits to ship meat to Mexico, so they probably aren’t the ideal market to test out your new Steak o’ the Month subscription box.
Like the aforementioned lithium ion batteries, some items are universally restricted and/or require a lot of extra hoop jumping to ship internationally. This is because they can be dangerous, like high-powered magnets on an airplane, or illegal, like ivory. ( …Or because they’re postage stamps. UPS will not ship U.S. postage stamps outside the U.S.) But never fear, some restrictions are carrier-specific. So if one carrier won’t ship your product, another may answer the call. Don’t give up!
Keep it Simple
Cross-border shipping is more involved than domestic shipping, we suggest you start with high profit margin items that you can afford to lose if your first experiment doesn’t work out. In other words, consider testing the international shipping waters by sending books, not hot tubs.
Once you’ve chosen your products and market, don’t be surprised when things change up on you. Tariffs and treaties and other changes may suddenly mean that a new market opens up, or something that you happily shipped to your customers in Country X yesterday is suddenly prohibited today.
It can be extremely difficult to keep an eye on changes, especially with the current tariff unease worldwide. It’s essential that merchants use software to help them keep an eye on changes, not only to the cost of shipping, but changes in what can and can’t be shipped.
Nail Down Shipping Logistics
Choose your carrier(s)
You have a ton of options when it comes to shipping items cross-border. Postal mail, like the United States Postal Service (USPS) or Canada Post is cost-effective, but often excruciatingly slow. Express carriers cost more, but can be much faster and offer perks like insurance and tracking that will give you and your customers peace of mind that the purchase is on it’s way.
Understand customs and duties
Think of customs and duties as taxes or tariffs on the items you import. Depending on things like what the product is, what it’s made of, it’s value and quantity, where you’re shipping from and the origin point of your products, you (or your customer) are likely going to have to pay extra as a cost of doing business for importing goods into a country.
You have a couple of options here:
- Delivery Duty Paid (DDP) – This means you, the merchant, pay all the taxes and fees associated with shipping internationally. You are generally billed by your carrier for these fees. In some cases you may not know the fees until after the order is delivered.
- Delivery Duty Unpaid (DDU) – This means that the customer is on the hook to pay all taxes and fees associated on the package. If you choose this route, be sure to let the customer know up front that they will be responsible for duties, otherwise you could end up with an angry customer.
The other option is to use a 3rd party custom and duties calculator to do all the work for you, and then choose to either pass all, some or none of that cost onto the customer.
Optimize Your Customers’ Experience
Offer varied delivery options
Some of your customers will want their purchase immediately. Others may be more price-conscious and defect to a competitor if the total price climbs too high. One way you can please everybody is by offering up choices. Price-conscious customers can save some money with slower shipping options, while the people who forgot their mom’s birthday can shell out extra for express shipping.
These days, many online shoppers have come to expect free shipping, even on international orders. Check out our guide to offering free shipping without busting your budget here.
Be transparent about shipping costs
The last thing you want to do is surprise your customers with an enormous grand total when they’re about to hit “Buy Now.” Or worse, shipping something around the world only for the customer to refuse to accept the shipment because of the high duties.
Shipping management software can help you give customers the whole shipping price story up front so you don’t end up with a bunch of products sitting in abandoned carts.
Are you ready to ship internationally? Do you have any international shipping questions? Tips & tricks? Horror stories?
Let us know in the comments!