12 Simple Mistakes to Avoid When Expanding to International Shipping

When you already have an established domestic business, it might be tempting to think expanding to the international market will be easy. That is certainly not always the case. Just because your business is popular in your home country doesn’t mean it will have immediate success overseas.Popular American fast-food chain Wendy’s attempted to take its old-fashioned hamburgers abroad and ended up with the embarrassment of having to close down 71 restaurants in Japan alone. American electronic retailer Best Buy failed to reach the EU and also had to close down its branches in Turkey and China. These companies made the mistake of not doing market research in the countries they hoped to target.There have been numerous global expansion success stories as well. Red Bull is an Austrian company that has now become the world’s top energy drink. Some companies find even more success internationally than they do domestically. For example, American fast-food chain KFC has 6,600 locations in China compared to just under 4,000 locations in the US.What’s the difference between the companies that succeed at expanding to international markets and the companies that fail? It all comes down to not making these costly mistakes.

1. Failing to have an international expansion plan

As with any large corporate move, it’s essential to have a plan for your company’s expansion to international shipping. Consider why you are expanding globally and the goals you hope to achieve. Clarify your budget and marketing strategy. Make sure you include details about the customs process and regulations for each country you plan to reach.The most important part of your international expansion plan is your market research strategy. Without thoroughly researching the markets you hope to enter, you will not have enough information to know whether your products will succeed there. Don’t miss our guide to establishing your export plan.

2. Being unaware of cultural customs

Whenever you start selling your products in a new country, you need to do whatever you can to learn about the cultural customs there...and make a plan for how to appeal to local customers using that information. This can be as critical as making sure not to use a product name that could be offensive in the local language.To return to an earlier example, why do you think KFC has become the most popular fast-food chain in China? They have included several food items that cater to the Chinese palate. You probably won’t find egg tarts, congee, or soy sauce wings on the menu at a KFC in Kentucky, but you’ll find them at one in China. They even have special bowls with classic Chinese figures on them. Examine how you can alter your products to be more appealing to local customers.

3. Not hiring local personnel

If you are truly hoping to make headway in foreign markets, it’s best to have local professionals on your team who understand marketing and customer needs in their countries more than you do. They will offer critical information that has the potential to make your company soar.You may not need to have a team of local professionals in every country you ship to, but it’s a good idea for the top two or three countries you plan to spend most of your efforts on. In these countries, look for the best team possible. This is also the best way to make sure you’re fully aware of the local customs.

4. Choosing the wrong shipping carrier

There are dozens of international shipping carriers that would love to be chosen as your go-to carrier service, but not all of them meet the mark. Look for a carrier that can ship to every country on your list so you don’t have to worry about dealing with multiple shipping companies.When it comes to shipping carriers, not having a tracking option is a dealbreaker. Without tracking, you are at greater risk of losing your packages and being unable to ever find them. Well-known international shipping carriers that offer tracking options include DHL, FedEx, and UPS.

5. Improperly estimating shipping times and costs

If you don’t make the effort to calculate shipping times accurately from the get-go, you might end up with delays that could frustrate your customers and even affect your bottom line. Underestimating shipping costs will leave you financially unprepared for the realities of international shipping. It might be challenging at first to make a proper shipping timeline and budget, but it is crucial. In order to avoid miscalculating shipping times and costs, get your shipping quotes well in advance. Make sure you take the shipping cost of returns into account...because no matter how great your products are, you will have returns from time to time. Keep in constant contact with your freight forwarder throughout the shipping process so you know where your shipment is at all times. Don’t forget to hire a customs broker to lower your chance of experiencing customs delays.

6. Not informing your customers about duties

There’s nothing worse than making an international order and then receiving a phone call saying you must pay $50 in duties to collect your package. Treat your customers the way you’d want to be treated and let them know about any taxes and duties upfront.If it’s possible, choose to ship Deliver Duty Paid (DDP) rather than Deliver Duty Unpaid (DDU). This is the best option for customer satisfaction. It allows you as the seller to pay all of the required taxes and duties in advance so your customer doesn’t have any unwelcome surprise fees when they receive the package. You can typically select DDP with your shipping carrier.

7. Thinking you don’t need insurance

“I’m sure we’ll be fine without insurance” are the famous last words of many a bankrupt company. International shipping is fraught with risks, and having the proper insurance is the only way to be truly safe. Imagine facing the financial loss of an entire shipment of damaged goods. With insurance, you won’t have to worry about bearing the brunt of the loss.Of course, there are many kinds of international insurance to choose from, each catering to the needs of different companies. Find out which one is best for your company here.

8. Incorrectly packaging goods

Your shipping strategy is only as strong as the weakest link...and don’t let the weakest link be the packaging. Use protective packaging that insulates your products from harm. If your goods will be shipped via ocean freight, use waterproof lining and packaging whenever possible. If your goods are fragile, look for sustainable packaging options that secure them properly.Make sure you measure your packages correctly. If you make a mistake with the weight and dimensions of the package (including all packaging materials), you will likely miscalculate shipping fees as well as duties and other fees. Use the proper labels and format the addresses correctly in order to avoid any delays.

9. Neglecting your domestic efforts

Be careful not to get so wrapped up in your international expansion efforts that your domestic business suffers for it. It’s crucial to maintain your domestic customer base, especially because it may take time for the international side of your business to become profitable.Decide whether you’d personally prefer to be more focused on the international or domestic side of your company. Then hire another manager to oversee the operations you’re not directly managing. This will ensure your company continues to grow both internationally and domestically.

10. Showing prices in only one currency

For a business that is only in the domestic market, it makes sense to have one standard currency on your website. Once a business becomes internationally focused, however, it needs to show prices in the currency of every country it hopes to reach. Relying on shoppers to convert the prices to their own currency will quickly frustrate potential customers and cause them to look elsewhere. Don’t make it more difficult than it has to be for international customers to order from your website. Make sure your website is translated into multiple languages. Allow customers to use PayPal or another international payment method to keep it simple for them to place an order.

11. Shipping orders one by one as you receive them

While this might work for an extremely small business, it will drive you crazy if you have a large international business. Shipping each order as it comes in throughout the day is a huge time-waster that can be easily avoided.If you are the one who’s primarily responsible for shipments, select a daily cut-off time for same-day shipping. Specify on your website that all orders need to be placed before 4:00 PM for same-day shipping. Then, compile all of the day’s orders at 4:00 PM. You’ll only have to make one trip each day to the shipping carrier.

12. Not hiring a customs broker

This might be the worst mistake you could make. Not working with a customs broker puts you at risk of customs fraud, shipment delays, surprise fees, and paperwork errors. Because customs brokers are experts in the field, they are a must-have when you’re expanding to international shipping.At BorderBuddy, we are ideally suited to help you expand your business to international shipping. You won’t have to worry about keeping track of the ever-changing international rules and regulations. We’ll take care of the customs details so you can focus on growing your business. Give us a call today.