Next Stop: The World
With the Internet transforming even the smallest catalogers into worldwide marketing companies, virtually every business at some time or another will be forced to handle international orders. While the process certainly is more elaborate than it is for domestic shipments, it’s not rocket science: Do your homework, avoid unexpected costs.
“Today, it’s relatively easy to market and ship overseas,” says Richard Miller, managing partner at North Chatham, Mass.-based Market Response International, an international direct marketing consulting and research firm, and also executive director of the International Mailers’ Advisory Group.
Mailers’ ability to communicate quickly with customers, acknowledge receipt of orders and address problems “has become almost instantaneous,” Miller says. International address correction, while still not perfect, has grown a lot easier. “When it comes to shipping, you still have to wrap the package, put it on a plane, train or boat, and get it there.”
Area of Confusion
Miller notes that the biggest area of confusion is landed costs, which are the processing fees, tariffs and ancillary charges that are applied once the package arrives at its country of destination. “This is one of the biggest problems; people don’t always understand the various factors that go into the pricing of the product, as well as the cost of delivery,” he says. Your pricing should cover these expenses up front. “Some of the more sophisticated catalogers factor that in to cover their unexpected landed costs. Those who don’t are frequently in for a surprise.”
To prevent these surprises, several elements must be considered:
■ the duty or tariff;
■ whether the product being ship-ped is subject to tariffs;
■ whether or not customs processing fees will be applied; and
■ the shipping costs themselves.
“When a package arrives in France, for example, and the person is faced with paying customs processing charges, that can be a big shock,” he says. “There shouldn’t be any surprises along the route.” Because tariffs vary, catalogers should research what regulations apply to their goods.
Modern technology also has improved the tracing and tracking of packages, and most shippers offer detailed information on a shipment’s whereabouts at any given time. Some mailers charge based on the amount of information they provide. “You have to weigh that against the value of the goods, and whether they will stand the extra cost of tracking and tracing the information,” Miller advises.
Some companies — especially those that deliver large volumes of goods internationally — enlist third-party services to oversee international shipments. “Once you get into the bigger volumes, generally people want to turn it over to a third party, particularly in terms of handling customs manifests,” Miller says. “That can be very time-consuming, and some of the third-party companies have developed electronic manifests to do this more quickly.”
This is especially true in light of today’s geopolitical climate, where a higher emphasis is placed on security. That’s resulted in slower shipments and added paperwork. Practicon Dental, a Greenville, N.C.-based cataloger of dental equipment, ships to some seven destinations outside of North America. The company uses a third-party, door-to-door, small package carrier. Practicon’s packages average between 50 pounds and 60 pounds, and usually are less than $2,000 in value.
Practicon Distribution Center Manager Marty Baker points out that the cataloger has dealer networks set up to push the idea of ordering in larger volumes. “As it stands right now,” he says, “the majority of our shipments are reasonably small enough to be handled by small package carriers.” As volume increases, Practicon will explore its options with larger carriers.
Baker suggests that catalogers just getting into foreign shipping either employ someone with a background in this area, or seek help from the outside. “Companies need people with some knowledge and background in international shipping,” he says. “Otherwise, they’ll need to hire a carrier or a broker to handle those aspects of shipping for them.”
How Long for Delivery?
Once upon a time, it could take weeks to get packages delivered overseas. But delivery speeds have increased dramatically, Miller points out. It takes some research to determine whether the added costs associated with expediting shipments are worth it, however. There are many choices out there, he says, if you take the time to review them.
“Delivery speed has gotten faster as time has gone on,” Miller says, “and the biggest mistake is that catalogers don’t know the options available. They don’t do their research and they end up paying more than they have to.”
While the regulations for specific destinations may differ, international shipping practices are pretty standard across the board. Miller notes that most carriers operate in all of the developed countries in the world. In fact, catalogers often can judge sales potential by watching where these vendors are setting up branch offices. “The shipping companies,” he says, “have gone in almost ahead of the market to set up the infrastructure.”
Carolyn Heinze is a freelance writer/editor based in Vancouver, British Columbia, Canada.