International Shipping from Australia: What You Need to Know For Seamless Cross-Border Delivery
- •Validating International Market Demand With Your First International Shipment
- •Navigating the Customs, Duties and Taxes for Your Target Country
- •Optimize the Cost and Speed of Your International Shipping
- •Provide choice and visibility with integrations
- •Automating Your Shipping Systems to Reduce Overhead
- •Price Your International Shipping to Drive Conversions and Increase Average Order Value (AOV)
- •Delight Your International Customers With a Great Shipping Experience
- •Time to Start Shipping Beyond Your Borders
If you haven’t already started selling internationally, it’s time to start!
Expanding beyond your geographic borders is one of the best ways to grow your eCommerce business. According to a UPS study on cross-border eCommerce shoppers, the majority of shoppers buy from International sellers.
This includes 83 percent of shoppers in Canada, 81 percent in Brazil, and 78 percent in Mexico. Even in huge consumer markets like the U.S., nearly half of all shoppers (47 percent) purchased from international sellers.
But to sell internationally, you need to figure out one key thing: shipping.
Scaling international shipping and fulfilment is crucial because customers expect fast and cheap (sometimes free) shipping options. In fact, 50 percent of all dreaded cart abandonments are a direct result of shipping fees calculated at the final step in the buyer's journey.
Here’s what we’ll cover in this post so you can ensure you have a scalable shipping system in place for your cross-border expansion:
Validating International demand before building your shipping strategy
Navigating the customs and taxes for your target country
Optimizing the cost and speed of your international shipping
Automating your systems to reduce overhead
Pricing your shipping to be competitive
Delighting your customers with a great overall experience
Let’s dive right in!
Validating International Market Demand With Your First International Shipment
When moving into uncharted territory, you always want to validate your strategies before going all-in to minimize the downside.
The same applies to your shipping strategy. It’s important that you have confidence in consumer demand in your target market before over-investing your valuable time and energy into figuring out systems.
One of our customers, Crockd, saw international website traffic from the US and started advertising on digital channels to test demand fast before deciding on their shipping strategy.
Once orders started coming through, they tested the shipping experience from Australia to the US using DHL and Australia Post. Once they had confidence in the market, they tested shipping options to build a scalable international shipping and fulfilment system.
Note: If your eCommerce store is on Shopify, you can use integrations such as “Shopify International Shipping” to purchase international shipping labels with automatically generated documentation. Alternatively, for a cross-platform solution, Shippit is able to integrate across other platforms like eBay, Dear Inventory or Fluent Commerce.
Navigating the Customs, Duties and Taxes for Your Target Country
Navigating the legal complexities of international shipping may seem complex. Lucky you, it’s not. We’ll cover everything you need to know step-by-step in this section.
Once you know where in the world you’ll ship to (see the above section) and what products you’ll be shipping, it’s time to check out the regulations you’ll have to comply with.
Familiarise yourself with regulations in your target country
Even if you aren’t selling obviously illegal goods, some countries prohibit basic household items outright. For example, dental products containing fluoride are illegal in Algeria, feeding bottles for babies are illegal in Venezuela, and clown costumes are illegal in certain regions of France.
The best place to get this information is from a country’s government website. For example, Canada has clear guidelines on prohibited products. Another great source is the Australian Post International Guide, which provides you with information on country-specific restrictions.
Customs Duties and Taxes
All countries levy specific taxes on imported goods. Usually, this is related to the cost of the goods. Almost all imported goods (unless they are below a specific price point or delivered from a country with trade agreements) are taxed.
That means you need to decide whether to include the international duties and taxes into the total costs and have this automatically charged at check-out, or you need to include in your shipping documentation so that your customers are informed of the amount they will have to pay when receiving the goods.
In either case, you need to prepare and complete a customs declaration form for your goods as needed, typically it will include:
Export Packing List
Instead of figuring out customs taxes manually, EasyShip has a simple import duties and taxes calculator. Airwallex customers can also receive AUD$100 of free shipping credits as part of our rewards program.
Optimize the Cost and Speed of Your International Shipping
Your shipping costs will largely depend on the couriers you use. Providing your customers with multiple options with different carriers is a great way to empower your customers and control costs at the same time.
“Offering cross-border shipping is a critical strategy for merchants looking to scale their eCommerce business. By offering a multi-courier solution, merchants are able to provide their customers with the shipping options they demand in today's market. But it's about more than simply offering the services. Merchants need to build a transparent shipping policy so their customers understand what to expect. This is also an opportunity for merchants to use international shipping as a marketing tool to attract customers in new markets,” advises Tommaso Tamburnotti, Co-Founder of EasyShip
Balancing Speed vs. Cost
National postal carriers are often cheap, but will offer limited packaging options and are generally slow compared to express carriers. Express carriers provide more options, accommodate different packages, and provide more service options, but are more expensive.
To find the sweet spot between costs and delivery time, you need to leverage hybrid shipping options. Hybrid shipping options allow you to combine services from both postal and regional express couriers.
When paired up, these solutions not only lower shipping costs but also provide a better shipping experience through faster delivery times and regular tracking updates.
Provide choice and visibility with integrations
Shipping software like Easyship and Shippit helps eCommerce businesses streamline their shipment’s real-time pricing information, bulk editing and printing of shipping information, and custom tracking and notification features.
Most eCommerce platforms have plug-and-play integrations with shipping apps that allow you to dynamically quote customers, tracking, various delivery, and insurance options.
Automating Your Shipping Systems to Reduce Overhead
At some point in your eCommerce business’s growth trajectory, it will make sense to automate things. One of those things is shipping/fulfilment.
When it comes to automating your business, there are different degrees of automation that are possible depending on the scale of your business. With shipping, the larger the volume of orders you fulfil, the more automation would save you time and money.
So what exactly can you automate in the shipping process?
The short answer: everything. Even the physical delivery of goods can be automated if you’re using a third-party warehouse and fulfilment/dropshipping service.
You can essentially automate almost every other part of your shipping system, from inventory management to optimising your shipping process (selecting the best and most cost-effective shipping option) to customer notifications.
For growing eCommerce businesses, leverage shipping apps (like the ones mentioned in the previous section) that integrate directly to your eCommerce platform to automate shipping documentation, orders, tracking updates.
For established eCommerce brands with larger volumes of orders (>100 orders a week) in international markets, consider a tech-enabled third-party logistics (3PL) solution such as Borderless360 and Shipbob that integrates directly with your eCommerce platform and automates fulfilment, inventory management, and customer communications.
Price Your International Shipping to Drive Conversions and Increase Average Order Value (AOV)
It may not seem obvious, but shipping is directly tied to your business’s key KPIs, like conversion rates. How many times have you gone through all the steps to buying something online only to be surprised by hidden shipping costs in the last step of your buyer’s journey?
It happens all the time. And as we showed in the graph above, 1 in 2 people abort their purchase for this very reason.
Understanding your international shipping costs is key to including them upfront instead of frustrating your customers and having them abandon the cart in the final step. To do so, identify the fully-loaded costs, including packaging and shipping, and how they vary across different order sizes:
Identify how often you make small, medium, or large orders and the weight associated with each of these.
Use Easyship’s shipping cost calculator to understand how shipping costs change by destination and weight.
Then, assess the right pricing model to cover your shipping costs. Here are three shipping pricing models you can use:
Carrier-calculated shipping rates. This pricing model takes real-time pricing from couriers and provides your customers with various delivery options to choose from. Tip: If you’re processing an increasingly larger number of shipments, you can negotiate discounted shipping rates with couriers.
Flat rate shipping. If your international shipping size and weight are consistent, you should consider using flat rate shipping. It standardizes the process and eliminates potential headaches.
Free shipping. Free shipping is extremely effective in driving conversions and is used by giant retail sites like Aliexpress. In fact, 79% of consumers say that free shipping would make them more likely to shop online.
To protect your profit margins, set your minimum order value just above your average order value to nudge customers to buy one or two extra items. This will help increase your AOV, number of sales, and profit margins.
Delight Your International Customers With a Great Shipping Experience
Many eCommerce store owners view a sale as the final step in the buyer's journey. But in truth, it extends far beyond the purchase. If you care about having repeat customers, the shipping experience (and return policy) is just as (if not more) important than the checkout process.
The two factors related to shipping that customers hate?
Hidden extra costs
Slow delivery times
To avoid both these scenarios, be transparent about shipping costs, customs taxes, and any other extra costs. Provide your customers with express shipping options and use hybrid shipping options to balance cost and speed.
Time to Start Shipping Beyond Your Borders
The first step to ensuring smooth sailing with international shipping is having clarity on what you’ll ship, to where, and at what cost. Researching these factors will help you prepare a strategy to grow your business internationally.
Remember: as is the case with your pricing strategy, your shipping strategy is fluid and changing. Don’t be afraid to experiment with new approaches and refine your strategy as new offers or changes take place.
Want to learn more? Check out our webinar with William On, CEO of Shippit and Adam Roark, Worldwide Transportation/Logistics Leader with AWS.
Ready to scale your business with Airwallex business account? Get more from your spending with our free multi-currency virtual cards. Open a foreign currency account with us and say goodbye to high foreign exchange rates and bank transaction fees. You can make international money transfers in multiple currencies, in one business day or less.
Related article: The ultimate Guide to ePacket shipping to Australia
The prioritisation frameworks every startup should use
The best flexible pricing strategies for SaaS businesses