Avoid Surprise International Fees with Delivery Duty Paid (DDP)
Learn how to avoid surprise fees for your international customers with greater transparency at checkout.
February 5, 2026 • 6 minute read
Author: Jessica Denbo Smith, Director, US Marketing, UPS
Key Points
- Shippers have a choice to offer delivery duty paid (DDP) or delivery duty unpaid (DDU) for international shipments, and each choice has a different impact on customer experience.
- International shoppers appreciate knowing the guaranteed landed cost of the items they plan to purchase, including duties, fees and taxes.
- Retailers who want to prioritize a simplified and seamless customer experience will likely choose to ship DDP so their shoppers are not surprised by additional fees upon delivery.
What is Delivery Duty Paid (DDP)?
Delivery Duty Paid (DDP) refers to an Incoterms® rule which dictates that the shipper is responsible for all costs associated with a cross-border shipment, including export clearance, transport costs, duties, taxes and any associated fees.
When retailers choose to ship DDP, their customers have a full picture of shipping costs at checkout and are not hit with any additional fees once their product has arrived.
Provide a Guaranteed Landed Cost at Checkout
Nothing frustrates customers more than surprise late fees after checkout. However, calculating fees and presenting shoppers with an accurate price that includes all associated shipping and fees (known as a guaranteed landed cost) can be difficult to do without the right technology.
That’s where solutions like UPS® Global Checkout come in. Once integrated with an online shipping cart, UPS® Global Checkout provides updates to international taxes, duties and tariffs in near real time, enabling retailers to provide their customers with total landed cost of their purchase upfront.
When Phidgets Inc., a manufacturer of high-tech sensors and control boards, began showing shipping, taxes, duties and fees upfront with UPS® Global Checkout, they gave their shoppers a new level of transparency. This transparency leads to fewer returns, less confusion and a greater likelihood of repeat purchases.
According to their President, managing tariffs and customs was always a challenge. Before UPS® Global Checkout, they calculated cross-border fees manually with mixed results, but now the AI-powered tool takes that work off their plates, so they can focus on manufacturing and selling great technology.
Because positive customer experiences directly impact loyalty, retention and revenue growth, providing information about tariffs and regulations upfront can be a critical differentiator.
Delivery Duty Paid or Delivery Duty Unpaid: What Retailers Need to Know
Many international shoppers are concerned about customs duties, taxes and fees. And when thousands of customers around the world realize these duties and taxes are payable when they receive their delivery, they’re often surprised — and not in a positive way. In fact, 41% of U.S. and U.K. customers said they were deterred from purchasing from an international e-commerce site when it wasn’t clear at checkout what the duties and taxes were.1
Offering a guaranteed landed cost not only removes surprise charges but also shows buyers that retailers are committed to making e-commerce sales as frictionless as possible. Providing detailed shipping information upfront can help.
For example, 72.8% of product categories are tariff sensitive,2 making most cross-border shipments more likely to face customs duties. Apparel, electronics and technology, and luxury and personal items often face complex rules tied to origin and valuation.2
Understanding rules and costs can help small- and medium-size businesses (SMBs) decide what products make sense to ship internationally.
International trade is also governed by what are known as Incoterms rules, which define shipping responsibilities for buyers and sellers. Two common categories directly impact retail strategy:
- Delivery duty paid (DDP): The business covers the duties, fees and taxes to ship the products. This can boost international sales, especially with new customers, and often makes sense for high-value items.
- Delivery duty unpaid (DDU): The customer covers duties, fees and taxes to ship the product. Shipping DDU can be the right strategy for cost management, particularly for lower-value items.
“Whichever option you choose, being upfront helps shoppers make informed decisions,” explains Qing Cao, Director of International Product Development at UPS.
“The worst scenario would be to spend $100, but when the item gets to the U.S., it’s another $50 in fees to receive the package,” Cao says. “If the customer refuses the payment, the package is returned to the sender with more fees added on top of that.”
Empowering both buyers and shippers with information before and at the point of sale can also help eliminate added costs and waste on both sides.
Navigating Cross-Border Complexity
For SMBs, cross-border shipments can be complex and costly. Duties, taxes, valuation accuracy, origin declarations, agency approvals, harmonized tariff schedule (HTS) codes, customs clearance and regulatory changes — like the elimination of de minimis in the U.S. — all add to the challenge. However, technology and real-time data can help simplify processes and make cross-border sales easier to manage.
“UPS® Global Checkout helps shippers and buyers navigate this ever-changing environment,” Cao explains. “The solution classifies shipments in real time, calculates fees, and updates rules and tariffs to ensure accuracy. Also, by integrating carrier and broker functions, UPS can expedite customs clearance and reduce risk for shippers because all fees are settled upfront.”
Understanding the cost and resources needed for cross-border shipments can also help SMBs make strategic market decisions.
Natalie Kozik, International Senior Product Manager for UPS, notes that recent policy changes mean SMBs now face new duties and taxes, which can impact when and where they offer products.
“If you’re selling a $10 T-shirt, the import fees may cost more than the value of the item,” Kozik says. “In those cases, it may not make sense to ship internationally. UPS® Global Checkout can help trigger important business conversations because it shows the cost to service your product across the border.”
Ways to Help SMBs Unlock New Markets
Cross-border shipment requirements vary based on the export country — and ever-changing government rules and regulations. Retailers can rely on UPS to provide the best strategy to ship across borders with services such as:
- Customs brokerage to assist with customs clearance, processing shipments across multiple modes, providing document images, exporting filings and more. UPS holds an Authorized Economic Operator (better known as AEO) certification in several countries. With this certification, UPS is pre-approved as a low-risk business, which enables faster brokerage clearance.
- Trade advisory services to classify shipments and manage duty optimization strategies.
- Speedy delivery to customers within a destination country with UPS Trade Direct® Cross Border.
- Tech integration to configure your systems to highlight the guaranteed landed cost.
- End-to-end logistics to assist with all shipments, pickups, customs and last-mile delivery.
International shipping is complicated enough without surprise tariffs, fees and rules getting in the way. The right shipping partner ensures you don’t have to carry that burden alone. UPS helps clear the path so you can focus on creating great experiences, wherever your customers are in the world.
1 “New research: How international ecommerce brands can combat hesitations of cross-border shoppers,” Nosto, October 22, 2024.
2 “Logistics Planning, Customs Management, and Tariff Impact,” ePost Global, May 27, 2025.
Individual results and options will vary. UPS makes no promises of any specific outcome in this document but instead provides only example outcomes based on certain UPS customer experiences.