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The Top 5 Things Businesses Should Know Before Shipping Internationally

Has your business been expanding? If you're thinking of branching out by taking your products or services abroad, there are several things you'll need to do first. Follow these five key steps to start out right.

1. Know Your Targeted Market(s)

All businesses understand that finding the right market is tricky at best. When you're considering an expansion into an international market, the task may feel even more daunting. After all, you have to make sure your local, provincial, and national foundations are solid before you go global.

It's also critical for you to investigate international talent pools and resources, understand the diverse cultures you will be interacting with, and prepare for extra paperwork. These are only the minimum considerations.

From a shipping standpoint, you should ask yourself the following questions:

  • Does my intended market have a free-trade agreement with Canada?

  • Does my business have a local connection or other viable plan for distribution?

  • What restrictions and legal regulations will I face?

  • What international standards are specific to my products or services?

Do some in-depth research specific to your industry so you'll understand trade regulations before shipping. Look for import/export restrictions and find as much information on trade groups as you can.

2. Understand Customs and Tariffs

Once you've done some targeted research into your intended market, shift your focus to customs regulations. Every time you ship, you should be prepared to fill out paperwork for your business's country and for the country where you're shipping your goods.

You'll also be charged fees and tariffs that you don't normally encounter in local or national shipping. The customs department will charge you a customs fee for every product you ship. The amount you will pay depends on where you're shipping the product, and will be higher if your product is high-end. Customs fees change from country to country, so uncover the details before you make plans.

You'll also be charged freight taxes and shipment fees by your chosen shipping company. Ask ahead so you're not surprised when it comes time to ship.

3. Investigate Insurance Needs

Each shipping company uses varied insurance terminology, but the basics are the same:

  • Insurance coverage is always extra.

  • Costs are based on your choice of deductible as well as the coverage you need.

  • You won't be protected against damages without insurance.

  • There are usually just two insurance categories: All Risk protects against damages, while Total Loss allows you to make a claim if your entire shipment is lost or ruined.

Keep in mind, too, that your shipping company may not offer insurance for every country. You'll probably discover this when you're narrowing down your intended international market, but don't make any major plans before you know if you'll be covered or not.

If you're only planning to ship lower-value products (for example, less than $50 per unit), you'll want to consider whether the costs of replacement justify the insurance costs. Your $15 product may not be worth insuring unless you regularly ship to riskier locations.

4. Prepare Your Documents

International shipping invariably means a lot of paperwork. Canadian regulations require export documentation, and, as previously mentioned, other countries will have import documentation policies unique to their region.

Most shipments require an international waybill. Sometimes you'll also fill out certificates of origin, commercial invoices, and other key pieces of paperwork:

  • Certificates of origin simply verify that the product was manufactured in a certain country. All North American countries use an official NAFTA certificate of origin if they ship to the U.S. or Mexico.

  • Commercial invoices are the primary documents customs officials use to determine valuation, duty, and control. Besides this, commercial invoices are umbrella documents for any supplementary shipment documents.

Ask your shipping company what other paperwork they require for Canadian companies who ship abroad.

5. Calculate the Costs

Understandably, the cost of international shipping is a concern to businesses who need to make regular shipments abroad. A good s hipping company can help save you costs, which is one reason why choosing a reputable shipping company is so crucial.

Here are a few important tips to help you save your company's bottom line:

  • Avoid costly errors. Understand the pros and cons of your shipping methods, then be sure to check shipments before they leave by using a reliable, streamlined QA process.

  • Don't guess on size and weight. This is especially critical if you're doing your own shipping while you establish your new connections abroad. Once you're making regular shipments, you can turn the process over to your shipper.

  • Ask for help. If you're concerned about any additional red tape your shipments might face, ask your shipping company what kind of help they can provide. They may be able to point you to online cost calculators, forms, and software to help you standardize your address list and shipment tracking processes.

  • Look for business resources online. Find out what businesses similar to yours are doing when shipping abroad. Don't be afraid to contact other business owners to learn how to strategize and streamline your own process.

Finally, realize that because all of this is new to you, you'll have to go through some initial trial and error. Factor that reality into you r overall business plan so you have some wiggle room while you adjust to your new shipping routine. Congratulations on going global, and enjoy implementing these steps to successfully capitalize on your new international market.


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