How to Manage International Delivery Efficiently?
Cross-border eCommerce sales are on a gallant rise all over the world. Be it B2C, D2C, or B2B, the number of global shipments is expected to amount to a whopping 1 trillion USD by 2030. Such a bold projection comes as a reminder that it’s an exciting decade for eCommerce entrepreneurs to expand to overseas markets.
The best way to start the journey is to learn how to manage international delivery efficiently. With a perfect plan, you reach your target customers better and expand to newer geographies without incurring a loss.
This article aims to explain the best ways online businesses can create a tactical international delivery strategy.
The Basics of International Delivery
For any eCommerce retailer, international deliveries are a goal they want to achieve in the long run. In recent years, global economies like the U.S., Canada, the U.K., and Australia have become attractive zones, with consumers ardently looking for global sellers. In this case, if you fulfill the demand gap with a streamlined global delivery process, you can get more revenue.
However, international deliveries differ from domestic shipping, mainly with regard to higher costs and tons of documentation. Your package travels greater distances, sometimes involving multimodal shipping.
Couple this with adhering to stringent customs regulations, tariffs, and duties calculation, fulfilling expedited EDDs, and managing returns. International deliveries can be a big hassle if you are unprepared. This is why most eCommerce retailers rely on their shipping partners or customs brokers to facilitate fast and smooth international deliveries.
4 Ways to Get Started with International Delivery
We have prepared a flowchart for you to follow to nail down the fundamentals of international delivery.
1) Understand what and where to ship
To pin down the logistical requirements of your international market, start with gaining an understanding of your target market and consumers. Each country has its own demand profile and shipping requirements.
A useful way to narrow down your customer base is to understand their spending habits. For example, an average European customer orders about 1.8 packages per month from global sellers, which makes 20 orders/ year. Having known that there is demand, you can study further to know the demand for your product, and you'll incur taxes in that country.
Next, understand the country’s import-export regulations and logistical infrastructure to gauge if you can fulfill your promised delivery times. For example, shipping to Canada, Australia, and the U.K. is relatively easier. They have fewer import regulations, high credit card penetration propelling online payments, and low customs duties. They also have large carrier support to fulfill 2-3 days delivery.
Lastly, decide if you want to have an eCommerce marketplace presence and use their fulfillment services for convenient shipping. For example, Amazon, Alibaba, Rakuten, and eBay have fulfillment services and warehouses located in many international destinations. Partnering with them can help you with an optimized global shipping procedure.
2) Get to know carriers and shipping rates
The key partners you can’t go without in international shipping are carriers. Your shipping carriers are the ones who carry over your shipments across great distances and put them on your customer’s doorstep. However, before selecting a carrier, it's important to adhere to an optimal balance between the cost associated with a carrier and their speed of delivery.
To offset any economic hurdles, it’s important you have a full grasp of the shipping rates. Usually, shipping rates are based on criteria such as parcel dimensions and weight, shipping distance and speed, destination, and volume of the shipment.
International delivery requires either of the three services: postal, carriers, or freight forwarders.
- Postal services are ideal for small, lightweight documents and parcels. They offer cheaper shipping rates and are trusted by customers. Examples include USPS, Canada Post, and Australia Post.
- Global carriers are known for their expedited delivery speed, wide range of delivery methods, and global presence. Examples include FedEx, UPS, DHL, and Purolator.
- Freight forwarders act as agents for the shipper in the international delivery system. They ship cargo or heavy-weight shipments or consolidated shipments. They are more involved in customs clearance. Examples include Kuehne and Nagel.
Choosing your shipping partner depends on multiple factors, not only their shipping rates and delivery methods. Check their delivery reliability, tracking visibility, and on-time/in-full commitments.
3) Learn about country regulations and taxes
Once you have a list of potential target markets, the next step is to fully comprehend their shipping regulations, restrictions, and tax systems. Normally, every country has a fixed rule demarcating certain items as prohibited and some others as hazardous. Even before you start shipping, confirming if your products fall into any of these categories is crucial.
For example, Australia prohibits shipping honey, beef, and other meat products. Brazil prohibits precious stones, fine artwork, and porcelain. You can get a comprehensive list of prohibited and hazardous items as well as other shipping restrictions from consulting your carrier partners.
4) Get your shipping documents and customs ready
A complex network of duties and taxes is involved in international shipping and, by extension, loads of customs document preparation. Here is a list of the most common documents that are required for international delivery:
- Commercial Invoices: These are bills for the shipments confirming the buyer and seller to the customs officers. Invoices are essential papers that establish the true value of the goods shipped. It helps the customs office determine the taxes and duties.
- CN22 and CN23: These are custom documents required when shipping to European countries. They are similar to commercial invoices containing parcel information, including product names, value, origin, and destination address. It is critical they accurately describe the contents of your package; otherwise, you may be fined at the customs office.
How to Manage International Delivery Efficiently?
1) Focus on robust packaging for safety
When traveling for great distances, we all pay heed to our safety. Similarly, robust packaging can be the safety net for your shipments journeying across borders and seas.
Strong packaging involves good reinforcements, such as using packaging tape on the corners of the parcel to avoid dents. Then, fill it with cushioning materials like bubble wrap and foam fillers. Extra protection must be applied for fragile goods. You can use corrugated cardboard after wrapping each individual item with air-filled cushioning materials.
2) Be vigilant about hidden and extra costs
International shipping involves multiple cost components: shipping rates, handling charges, taxes and duties, packaging costs, and insurance. Cost-efficient shipping begins with the correct analysis of hidden and extra fees, such as surcharges levied by carriers. Some of these are:
- Extended area surcharges are levied if the customer’s address is located in an area beyond the usual collection network of the carrier.
- Certain carriers classify services like insurance and deliveries on weekends as value-added services that add extra costs to the commercial invoice.
- Dangerous goods incur additional fees mostly collected as a certain percentage of the shipping costs, based on the value of the goods, or both.
- Materials and shape of the parcels, such as cylindrical or wooden packaging, attract more costs.
3) Find the right carrier and shipping method
The success of your international shipping depends on the accurate formula of an optimal shipping method plus the right carrier. The first concern to tackle in cross-border shipping is speed.
Since most customers are habituated to fast delivery windows of 2-3 days, it’s important that you prepare for it. The best way to go about doing this is to establish a wide carrier network or practice multi-carrier shipping. This can help you get competitive prices, get fast customs faster with seasoned carriers, and leverage their air fleet for expedited shipping.
Researching about carriers and their services comes in handy for giving the best delivery experience to your customers. Here are a couple of examples:
- DHL is well-suited to carry small parcels for express shipping and for handling dangerous goods.
- FedEx is excellent for overnight or 2-day shipping methods, especially its priority economy and freight shipping offers.
- DB Schenker offers cheaper international air freight shipping with robust support for LTL shipping in Europe.
4) Provide excellent order tracking and notifications
One of the key factors determining customer satisfaction (and, by extension, customer retention) is order tracking and notification delivery. In fact, a survey found that customers’ ability to track orders increased their urge to buy from global brands by 2x times.
Needless to say, then, a top-notch delivery experience involves accurate tracking data and personalized notifications. To give the best tracking experience, you can partner with logistics companies to access real-time visibility.
At the same time, investing in designing the contextualized and branded tracking page will generate greater customer satisfaction. You can further this with setting up notification gateways for order tracking information. Preferable modes include WhatsApp and SMS notifications since they have high open rates.
5) Be transparent with shipping charges and delivery fees
Shipping charges or delivery fees are friction points in a customer’s checkout journey. In many cases, customers prefer to have free shipping that can burn a hole in their pocket. Therefore, transparently structuring shipping fees is of utmost value in informing customers and establishing trust.
The best way to go about this is to communicate your shipping policy to customers. Clearly state information such as a breakdown of the costs associated with shipping, the amount of duties to be paid, and who pays them. Explain to them what you charge them for, such as packaging supplies, insurance charges for high-value goods, etc.
6) Create custom shipping zones with reliable carriers
Handling shipping costs is one of the most sought-after solutions that all brands shipping internationally wish to know. One of the most well-established methods is creating custom shipping zones. Each country has standard shipping zones involving similar shipping charges.
Setting up custom shipping zones can help you manage deliveries efficiently. For example, if you band together countries that are cheaper to ship internationally, you can create a cluster of regions that are free to ship. This will also help automate the shipment allocation process. Shipping bulk packages to these regions can get you bulk discounts from carriers.
7) Automate and streamline your shipping processes
To complete a shipping process requires multiple tasks to be accomplished for each parcel. This involves processing orders, creating shipping orders with carriers, printing shipping labels, sending customer notifications, and more. The best solution to quickly go through these steps is to automate them. This will save you both time and money.
Relying on shipping software is the best way to automate your entire shipping journey. They help streamline the shipping workflow, managing order manifestation, carrier allocation, shipping label generation, and tracking.
More importantly, automation can help reduce costly errors such as auto-correcting addresses and automatically contacting customers to gather the right information in case of delivery delays.
8) Handle Returns Effectively
Almost every eCommerce brand faces 20-30% returns on average each year. Though returns of international packages have fewer occurrences than domestic returns, you still need to prepare well for it. The effective ways to handle returns start with a good preparation strategy.
This includes adequate packaging to lessen damages and order tracking to lower shipment misplacement. Even offering flexible refund solutions and a longer window of returns policy can influence people to keep the product.
To make an optimized returns workflow, you can engage with returns management solutions or outsource returns to local 3PLs. Take for instance, a 3PL with global warehouses that can accept the returned order at a lower restocking cost than shipping it back to the home country.
International shipping isn’t an easy process, but with proper guidance and a strategy in place, you can excel in it. It all begins with understanding customer demand and shipping needs and creating the necessary logistics resources that will help seamlessly ship goods between countries. We hope this article will help you identify the critical areas you’ll need to know to make your brand into a global one.
1) How can businesses save on international shipping?
There are a number of ways you can save on shipping costs when providing global deliveries. The common way is to negotiate with your carriers for lower shipping rates when you ship in bulk. Secondly, you can flat-rate shipping, use regional carriers, and optimize packaging to avoid waste of space and materials.
2) How can retailers increase international delivery success?
The best ways to increase international delivery success are to identify the right market with customer demand, abide by legal requirements, prepare for customs, and partner with the right shipping carriers. Equally important is to manage returns.