One of our fastest growing ecommerce business segments is cross border trading. Unfortunately, cross border trading is not only complex; it’s expensive. Also, it’s one of the most misunderstood practices today within the industry. With all the complexity of shipping across borders, how does the merchant stay educated and up to date? I’ll come back to that in a moment.
There are many ways to make international shipping solutions smooth, but they must be planned out before the international ship campaign starts. It’s certainly not something that should be launched willy nilly without using expert advice. Businesses are destined to experience shipping and customs related issues without an expert level knowledge and/or education.
One of the key factors when shipping internationally is to provide accurate information within the required documentation. This is much more important than worrying about time in transit. Another key factor is finding a ship solution that provides accurate tracing and tracking all the way to the recipient’s door.
For the online merchants, it’s a good idea to have a couple different carrier services on your check out page; one for a more economical solution and the other for an express.
You will need the basic understanding and use of the following terms:
Incoterms – A set of rules that define the responsibilities of sellers and buyers for the delivery of goods under sales contracts. They are published by the International Chamber of Commerce (ICC) and are widely used in commercial transactions. The two most used for small parcel international shipments are:
DDU or DAP (Delivered Duties Unpaid) Buyer pays all costs for taxes of import clearance.
DDP (Delivered Duty Paid) Seller or shipper pays all costs for taxes of import clearance.
HTS – An HS or HTS code stands for Harmonized System or Harmonized Tariff Schedule. Developed by the World Customs Organization (WCO), the codes are used to classify and define internationally traded goods. Your products will all have to be designated with a code before you can ship internationally. This code dictates the duty rates that will apply.
CI-Commercial invoice – A proof of ownership. It’s a document prepared by the exporter / freight forwarder for the foreign buyer. It includes information, such as the description of goods, Value, HTS, address of shipper and seller and delivery and payment terms.
It takes a lot of knowledge and education to become a competent international shipper, let alone to stay up to date on terms and regulations. The good news is that there is up and coming co-operation between eCom logistics and big tech. Expert companies are popping up that can provide immediate ship solutions that integrate to your shopping cart or 3PL. They can streamline the process and take the responsibility of getting your packages across borders without issues.
If you would like to learn more about these services please contact me at [email protected]
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About the Freight Freak:
John Bevacqua is the VP of Logistics at AMS Fulfillment. His area of excellence is in creating distribution and fulfillment operations that function as a capable interface between suppliers, retailers, and wholesale distributors. His experience includes developing and leading FedEx/ Kinko’s Distribution Services into the FedEx post acquisition, USA Wireless Technologies, and a top Logistics Management company. He has also worked with third party fulfillment companies, preparing him for his current position with AMS Fulfillment.