Thinking Through International Shipping Strategy

A third of online shoppers have purchased goods from another country. Those living in Australia, Canada and Russia are the most likely to buy internationally. In Asia and India –– two of the fastest growing markets for ecommerce, with YoY growth in the 30 or more percentile –– marketplaces similar to Amazon and eBay make it easy for international companies to test product market fit.
Now, how do you bring those customers back to your site for purchase once you’ve determined demand? Many online stores find international shipping nearly impossible given the regulations, rules and risks associated with each country.
To overcome that initial fear of international shipping, it is important to know what shipping options and fulfillment services provide low costs and risk.
Once you have a clear understanding of how international shipping works, researched the services that best fit your company and put an international shipping strategy in place, you will be able to open your online storefront to a global audience and break into the global market.
Initial Assessment
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Shipping internationally opens your market to a potential three billion consumers. But, before you build your international shipping strategy you should determine if it is right for you. You don’t want to put time, effort and money into this if you aren’t going to come out with profit.
Here are a few things that come into play.
Is my product suitable for international shipping?
Know what it takes to ship your products out of the country –– or if those products are even suitable for such long distance shipping. Ideally, you ship items that are sturdy and compact to avoid an item breaking in transit, which can leave a bad customer impression.
If you are shipping perishable goods or large items, you may want to keep these items solely available to your domestic customers.
It is also important to be aware of any import and/or export restrictions subjected to the product and specific countries. Here’s a short list of items prohibited from international shipping:
Aerosols
Air Bags
Alcoholic Beverages
Ammunition
Cigarettes
Dry Ice
Explosives
Fresh Fruits and Vegetables
Gasoline
Nail Polish
Perfumes (containing alcohol)
Poison
This should not stop you from shipping internationally altogether and we’ll go over how you can restrict items from shipping to certain destinations in a bit.
Is there demand for my product?
Do the research! It is pretty easy to determine if there is demand for your product if you have already had requests from international customers. But, if you don’t have the luxury of knowing who already wants your products, you should look into what is currently being offered in countries you want to ship to. Try to find out if there are similar products being sold and what the competitors are doing.
In the same way you’ve built your national audience, you’ll want to access the competition and get your goods in front of your target audience. But, international consumers shop differently than you are used to. In Asia, for instance, Rakuten outpaces Amazon. If your goods sell well in the U.S. on Amazon, consider placing your product on Rakuten to test out market fit and demand.
Here are larger international marketplaces to keep your eye on as you expand. These are great places to test out your product offering before launching a site-wide campaign targeted to international customers.
Rakuten: Asia, especially Japan, though the company is expanding outside of Asia as well, B2C marketplace
Alibaba: Asia, China in particular, B2B marketplace
Taobao: Asia, China in particular, B2C marketplace (the B2C side of Alibaba)
Snapdeal: India, B2C marketplace
Flipkart: India, B2C marketplace
Amazon India: India, B2C marketplace
Mercado Libre: Latin America, B2C marketplace
Choosing the Right Service
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Shipping internationally comes with its own obstacles and you should do your research before opening your gate to the world. Some important factors such as shipping costs, tracking, delivery times and guarantees will come into play when you are looking into services. One service does not fit all. Know what international shipping service is the best fit for you and your customers’ needs.
Here is what to think through.
International Carriers
This could be a good choice for smaller companies because you will have the backing of a large company such as UPS, FedEx and DHL. These companies have years of experience in shipping both internationally and domestically.
With international carriers you will experience a higher level of international shipping services as they offer door to door tracking and guarantees in pricing. Since they are a larger company, their prices tend to start out higher, but there are options for negotiation.
National Carriers
This is the in-between option of international carriers and international freight forwarders. National carriers, such as USPS, Australia Post and Canada Post, focus on servicing a specific country. These companies normally offer lower prices than international carriers but you won’t have the detailed door-to-door tracking that you will find with the other carrier services.
International Freight Forwarders
An international freight forwarder manages your shipment from beginning to end. This is a good option for merchants with a larger shipping budget as the prices are slightly higher than international and national carriers.
This service will make breaking into the global market a little easier, and is is just about as simple as if you were shipping domestically. You send the package to the international freight forwarder’s hub and they take care of preparing and processing customs and other documentation involved in shipping internationally.
The following international freight forwarders (or 3PLs) are considered best-in-class, with the highest number of customers and revenue: