In 2020, cross-border shopping was estimated to reach $1 trillion. So, if you want to grow your dropshipping business, you must consider international shipping.
Thanks to the internet, the world is now much smaller. Customers have also come to expect international shipping. If you are not doing so, you are leaving a lot of money on the table.
International shipping creates the chance for your dropshipping store to reach and sell to a larger audience. However, to do it right, you must equip yourself with strategies that work best for you and your business.
In this article, you will gain a good understanding of dropshipping internationally. You will learn a few tricks and potential setbacks you can expect as well.
Creating your international shipping strategy
When building an international shipping strategy, there are some key issues to consider.
Where you are shipping to
You must know which specific territories you want to sell to.
Neighboring territories: Best practices recommend starting close. Start with nearby countries to get familiar with shipping across borders.
Existing customers: Through your customer demographics data, you can tell which countries already bring considerable traffic. Since there is already a market and interest from these countries, it is an excellent place to start.
Language: As you consider countries for expansion, consider language. You could target countries whose language you are familiar with. Otherwise, communication problems will be dominant.
Market fit: Based on your product, you can scan for markets whose needs suit your dropshipping business. If the country’s tastes and preferences align with the products you are dropshipping, you can consider it a great place to ship.
What you are shipping
Although the prospective markets may look attractive, it is necessary to filter which product lines you can ship.
Some products may not be the best option to ship to certain areas. This could be due to different reasons.
Costs: It is usually cheaper and easier to ship smaller packages. Also, fragile items may be tricky to ship long distances. They can easily get damaged, creating a bad user experience. So, you must consider the additional costs of delivering such items.
Country rules and regulations:
Different countries have different laws regarding trade, which you must consider.
These rules influence the types of goods you can deliver, customs obligations, etc. What you can dropship within your country may be illegal to send to another or restricted. Various sites and couriers offer this information for free, so ensure that you do your research.
Which carriers you are shipping with
There are numerous carriers worldwide that you can use to fulfill your international orders. The most widely used are FEDEX, DHL, etc.
To choose the best carriers for your dropshipping store, consider factors like:
Some carriers are more expensive than others. Express carriers like UPS, FedEx, etc., tend to be faster and more flexible with package types and services offered. However, they can be more expensive.
On the other hand, postal carriers like USPS, Royal Mail, etc., tend to be slightly slower and offer fewer services. Yet, they are often the most affordable.
Weigh the options available to you to help you determine your pricing.
Alternatively, if you are dropshipping your products from China, ePacket shipping is the best option.
This method is the cheapest and fastest way to ship products directly from China. It would take weeks or even months to ship using regular carriers. Yet, with ePacket, your packages could arrive in 7-30 days and with tracking capabilities.
EPacket shipping comes with weight and size restrictions. It also only works when shipping to 44 countries.
Some customers might require almost instant delivery. Yet, others may be okay with waiting a bit longer. To increase the chances that they will buy, It helps to provide multiple options to them.
That way, they can choose between faster and more expensive options or slower and cheaper options.
Customers like to keep track of their purchases. So, you must look for carriers that provide shipment tracking. For example, popular options like DHL and ePacket offer tracking services.
Most carriers provide shipment tracking so that you and your customers can see up-to-date shipment statuses. You can also use ePacket’s end-to-end tracking options.
Insurance is essential in international shipping to cover goods that may get lost or damaged in transit.
It is usually automatically included in shipping costs by most global express carriers. Even locally in the US, some postal services include insurance. If not, you can add it at an extra cost.
Shipsurance can cover most shipping issues in the US irrespective of the destination or the shipping method you use.
Having insurance on international shipments gives you and the customer peace of mind.
What to charge for international shipping
To compile the costs of international shipping, you must factor in the costs of the goods, your profits, etc.
When shipping internationally, there are three main pricing structures you can consider.
Carrier rate shipping: Carriers often charge more reasonable prices and offer. Check if your dropshipping company integrates with the various carriers like DHL, UPS, etc.
Under carrier rate shipping, the cost depends on what the carrier charges.
Free shipping: in some cases, your profit margins may be sufficient to cover shipping costs. In this case, you can offer free shipping to your customers. Doing so could increase conversions.
Flat rate shipping: this method works when your shipment products are of similar weights and sizes. Under flat rate shipping, you charge a uniform rate for all shipments.
Flat rate shipping is excellent for limiting confusion among customers. It also helps to spread out shipping costs across your product lines. It tends to be cheaper too.
Pro tips: It is highly recommended to be as transparent as possible about the shipping and total costs of your products
Surprise costs are the number one reason why online buyers abandon their cart. So, inform the customers about all the charges involved every step of the way.
That way, they are not shocked by sudden cost increases at the end of the process. Conversions will also likely increase. See what vendors do on AliExpress.
Additionally, include a clear policy on your dropshipping site about customs duties and other taxes are handled.
This communication enhances trust with customers, thus increasing sales and recommendations.
Additional factors to consider when shipping internationally
The level of competition
Before you start to ship internationally, you must assess competition in the areas you want to target.
Find out if there are many stores with similar offerings as yours. In case they are many, you should look at potential gaps like product quality, unmet needs, etc.
Such information helps to know whether it is worth it to enter a specific market. Excessive competition comes with high costs of advertisement as well. The information also guides you to greener potential countries to expand to.
When you do international shipping, consider as many payment options as applicable in your target areas. Customers also largely abandon carts because they cannot find their preferred method of payment.
So, in addition to widely spread means like Visa Card or PayPal, consider other methods commonly used in the areas you are shipping to.
Customer reviews are critical when shipping internationally. They enhance your credibility online, thus increasing conversions.
However, when dealing with foreign customers, sometimes you might get reviews in a foreign language. Make an effort to translate such reviews as well to make the most out of them.
Currency and exchange rates
Shipping internationally will often require you to make transactions on other currencies as well. You must account for the currency disparities as you draft your strategy.
To reduce these currency problems, stick to running your store in USD since it is popular globally.
International shipping has made dropshipping internationally much easier. You can now sell to broader markets from the comfort of your home or state.
However, it is not without its issues. You must account for various factors such as language, currency, shipping costs, country laws, regulations, etc.
Therefore, it is critical to weigh the risks in different areas you want to ship to. That way, you can import your products worldwide with minimal hindrances.