When your business crosses borders, there are plenty of complexities to deal with-from different languages and currencies to diverse cultural norms.
Even the process of shipping internationally can seem like a foreign experience. But the main difference between shipping domestically and moving your goods globally is customs. Here are five tips to help your business successfully navigate customs regulations and procedures and avoid international shipping delays.
If there is one thing that governments around the world all love, it's paperwork. So filling out the right documents-accurately and completely-is the first step to keeping your shipments moving through customs in any country.
The document you will use most often when shipping from the U.S. is the commercial invoice. It contains pertinent information about the shipper, the receiver and the items being shipped. In certain cases, you may also need to provide supporting documentation, such as a Certificate of Origin or Electronic Export Information (EEI).
To make documentation easier, choose an international shipping partner who can help you select the right forms or even go paperless by filling out, saving and submitting forms online. That way you'll save time and help reduce the chance of manual errors.
Did you know one of the main reasons shipments are held in customs is due to an inaccurate or incomplete description of goods on the commercial invoice? That's why it is vital to fill this section in correctly and completely.
Greg Maddaleni, Customs Brokerage Manager for UPS Global Freight Forwarding, recommends you ask yourself these questions about your international shipment to provide an accurate description to customs:
To make things go even more smoothly, include the Harmonized Tariff codes, if available, for the goods you're shipping. These codes are the standard international reference for classifying products for duty and clearance. Items are grouped into broad categories and refined into narrow groups. All countries around the world have agreed to use these codes.
According to Ruchi Shah, Director, U.S. International Marketing for UPS, "Getting this part right is extremely important. Customs may scrutinize your description or tariff codes, and a customs agent could question either or both of them, which could lead to delays in current or future shipments."
To help ensure accuracy and minimize delays, let an experienced managed services provider supply the proper code classifications for your company's entire product catalog. That way you'll have the Harmonized Tariff codes you need at your fingertips whenever your business is ready to ship internationally.
Every government has its own set of rules and regulations you'll need to follow. Thinking of shipping antiques to China? Bicycles to Mexico? Or beef jerky to the U.K.? Sorry, but those items are on the prohibited list for these destinations. Many countries have specific weight and size limits, depending on the shipment mode you use, and exceeding them is one of the most common reasons a shipment may get delayed.
Shipments to some nations will require unique documentation, like a NAFTA Certificate of Origin if you're trading with Canada or Mexico and are claiming your shipment should be duty free. Depending on what you're shipping, you may have to provide special documentation and fees to partnering government agencies, such as the country's equivalent of the U.S. Food and Drug Administration.
It's also good to be aware of the holidays and business days the nation observes, as this will affect when shipments are delivered. For the best international shipping solutions, choose a partner with local knowledge and years of experience in the country you're shipping to.
Whether you're shipping to Berlin or Bangalore, the last thing you want is to be surprised by extra costs or hidden fees. So begin by estimating the landed cost-the total international shipping cost including transportation charges, duties and taxes.
Calculation of duties and taxes will be based on the value of your goods. It is important to give an accurate valuation on your commercial invoice, because if customs officials think it is incorrect, it could cause problems for you now or even years later.
Maddaleni explains, "In many categories, the taxes could be very modest. So to provide anything but the correct market value could put a customer unnecessarily at risk with local customs. This could mean paying, auditing of prior shipments and holds to future shipments. It's just not worth it."
It is possible you won't have to deal with customs or associated fees at all. Most countries have what's called a de minimis value. If the minimum value of your qualifying goods falls below this level, no formal customs procedures are required and no duties, fees or taxes are collected. By strategically targeting countries with a high de minimis value, you can potentially save money, help to shorten transit times for faster delivery and reduce paperwork.
For most international shipments, the costs end up getting divided. The shipper usually pays shipping charges while the receiver pays duties and taxes, but other options are available. An experienced shipping company will have the tools to help you choose the right method of shipment, estimate the landed costs and determine who pays for which part.
Even when your business is armed with these insights on international shipping, issues are sure to come up. Thankfully, there are great resources you can turn to with your worldwide shipping questions.
The U.S. Commercial Service can help you before, during and after the shipping process. They publish A Basic Guide to Exporting, which contains a wealth of information about taking your products to overseas markets. They also have local offices in 100 major U.S. cities and 75 top trading countries.
Feel free to reach out to the border agencies for the countries you're shipping to or visit their websites. The Canada Border Services Agency, for example, has a section of its site devoted to information about imports and exports.
And of course choose a shipping provider experienced in international shipping and logistics-one that can help you navigate the process and answer any questions.
"UPS's international network helps give customers the reliability, expertise and global infrastructure they are looking for from their export carrier," advises Shah.
To learn more about global shipping solutions and the things you'll need to consider when shipping internationally, visit ups.com/international.
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