- The global eCommerce marketplace is expected to total $4.89 trillion in 2021
- The European Union (EU) overhauled its value-added tax (VAT) tax laws that determine how duty and tax are paid, and how to import paperwork must be filed
- Third-party logistics providers (3PL) are companies that execute shipping and fulfillment on your behalf
The global eCommerce marketplace is expected to total $4.89 trillion in 2021 一 a 45.8% increase in the past two years. Indeed, now seems like a great time to start selling and shipping overseas. International shipping is more complex than domestic shipping, though. Vast distances, regulations on duty and tax, and country-specific restrictions should all be on your radar.
In this blog, we’ll discuss the overlooked implications of shipping internationally as an eCommerce business.
Table of Contents
1. You Shouldn't Sell Everywhere
It’s best to evaluate the demand for your products in a new market before you start shipping. This is because you may struggle to ship cost-effectively to certain areas, depending on your item weight, size, or in-country restrictions.
For example, it doesn’t make sense to ship to places where you lose money on shipping. Or that taxes your goods too high heaven. An ideal market both has a taste for your products and the regulatory landscape for good profits.
Evaluate the following factors to identify your ideal target overseas markets:
- Global buying trends: Research where demand for your products is highest.
- Customer service: Revisit your customer service requests with an eye for foreign-based prospects. If several Swedes have vocalized their desire for your products, for example, this is a great place to start.
- Import restrictions: Each country restricts and prohibits the import of certain items. Look this list up for any prospective target market to avoid a costly snafu at customs.
Based on this information, you should be able to decide if that country is a good match for your particular product.
2. EU Shipping Got Easier
As of July 1, 2021, shipping to and within the EU is much simpler. The European Union (EU) overhauled its value-added tax (VAT) tax laws that determine how duty and tax are paid, and how to import paperwork must be filed.
The two main changes for online sellers that ship within the EU are:
- Less VAT paperwork: You no longer need to register to file taxes in each country you ship to. You can instead file a single VAT tax return, known as OSS filing, for multiple EU countries.
- New €150 VAT threshold: All imports valued at €150 or less are now subject to EU VAT tax. Previously, imported goods shipped to EU buyers valued at €22 or less were exempt from VAT. The EU has removed this import VAT exempt threshold. Regular duty and tax rates still apply to imported goods valued at €150 or more, meaning the buyer’s delivery address determines the country-specific VAT rate. Learn more here.
3. Duty and Tax Vary Widely
When you import goods to a foreign country, your shipment may incur duties and taxes at customs. Customs fees are assessed based on the item value, category, and other factors. All duty and tax must be paid before the package can be delivered, either by you or the recipient.
Duty and tax vary widely between countries, making it hard to predict these costs. In other words, you’ll be hard-pressed to know what you or your customer must pay for an individual cross-border shipment. This is important because customers abandon carts due to unexpected shipping costs at checkout. Additionally, you need to maintain visibility of your full shipping costs to avoid losing money on fulfillment.
With Easyship, you can display accurate duty and tax automatically for each shipment in checkout. This way, your customers have full transparency of import fees plus shipping costs and are greenlit for a purchase. Below is a screenshot of accurate duty and tax rates.
Get accurate duty and tax rates for a specific item or shipment in seconds? Try our free duty and tax calculator for a snapshot of all your import costs. With total visibility of costs in real-time, both you and customers can breeze through international orders.
4. Save Big on Small Couriers
Local and regional couriers often offer cheaper rates than multinational couriers like FedEx. The challenge is finding these couriers, though. You don’t know what you don’t know, and googling all couriers in say, Dubai – can be a tedious process, to say the least.
Try our free shipping rate calculator to discover the cheapest rates from all global available couriers for each shipment. In the example below, we use our rate calculator to find the best rates from the US to Armenia.
Note the diversity of couriers, many of whom aren’t available in the US. Rather than compare rates on courier sites and google for regional couriers, a rate calculator can save you money and time on getting the cheapest international shipping rates.
5. Free Shipping May Not Work
Free shipping is all the rage in the world of eCommerce, but it’s not free for you. Though free shipping increases conversions and helps build customer loyalty, not all merchants have the economies of scale to offer this feature.
Say you sell heavy clay pots. The shipping to Uganda and many other faraway countries would run you hundreds of dollars. Instead, you can simply discontinue free shipping to certain countries. But, don’t let a few exempt countries discourage you from using free shipping in the US.
Sixty-four percent of brands offer free shipping on orders over a certain value threshold, making this the most common way to offer free shipping. Or, you can opt to offer free shipping seasonally (i.e. on Black Friday).
It’s important to weigh customer expectations against shipping costs. With Easyship's free shipping rate calculator you can get a clear sense of your shipping costs to any market. That way you know whether or not free shipping is an option to a new area.
Related blog: The Total eCommerce Guide to Free Shipping for eCommerce
6. Customs Paperwork Matters
Shipping internationally requires you to complete customs documentation for each shipment. Challenge is, the customs paperwork required is different in each country.
Fortunately, every shipment created in Easyship generates all the necessary paperwork for your shipment. This way, you’ll never have to worry about overlooking some key documents.
Be careful about filling out these forms, though. Your package may be delayed if something is missing or not entered correctly.
Typically, the following documents must be completed for a cross-border shipment:
- Commercial invoice: A legal document between the supplier and customer that describes the sold goods. It’s the invoice for the goods from the seller to the buyer
- Dangerous goods form (if applicable): If the items in your shipment contain dangerous goods, you have to include the appropriate dangerous goods form.
- Certificate of origin: This is a document declaring where a good originated. If custom authorities doubt the validity of the declared country of origin, they may request additional proof such as the certificate of origin
With Easyship, you’ll be prompted to complete these must-have forms by your courier when you buy your shipping label. You can visit Easyship’s country page for more information on what documents are required for each destination country.
7. Growing? Save with 3PL Fulfillment
Third-party logistics providers (3PL) are companies that execute shipping and fulfillment on your behalf. In other words, you store inventory with a fulfillment partner and outsource the processes of shipping and fulfillment for sales in markets near their partner’s location. For example, if you work with a German 3PL, all your sales to Europe could be fulfilled out of their warehouse and fulfillment facilities.
Customers enjoy lower shipping costs, faster shipping, and lower import fees when they partner with a 3PL provider. Consider a 3PL if the following scenarios apply to you:
- You’re processing more than 100 shipments per month
- You’re falling behind on fulfillment
- Your customers are centralized in major urban centers
8. Shipping Options Drive Sales
Honestly, international shipping can be tricky. Twenty-five percent of online shoppers abandon an order because of unexpected high shipping costs, but it costs more to ship overseas than domestically. Oh, and duty and taxes are always variable.
This begs the question – how can you reduce your shipping costs and provide full transparency of shipping costs to maintain your conversion rates?
You can display real-time shipping rates at checkout with Easyship's Rates at Checkout feature. This cart optimization feature lets you display three shipping options in checkout automatically – the cheapest, fastest, and best value option. All duty and tax amounts are also auto-calculated to each individual order.
Research shows that having options for shipping in checkout boosts conversions. With Rates at Checkout, you can choose from 250+ shipping solutions to offer customers – all discounted up to 89% off retail.
How Easyship Can Help with International Shipping
Selling and shipping overseas are more complicated than domestic shipping, but Easyship makes it easier. Our all-in-one platform erases the need to do tedious research on the best available rates, as compared to manually looking up individual courier rates.
Though international shipping is more complex than domestic shipping, our shipping experts can guide you through how to ship internationally. That way you can scale your business globally with a leading shipping platform like Easyship.
Easyship users have full cost visibility and choose from the best available shipping rates in real-time. Plus, users save up to 89% off shipping rates on 250+ couriers.
Ready to start shipping internationally? Scale your business globally when you sign up for free today.
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