Borderless Business: How Electronic Postage Technology Demystifies International Shipping

Transcription

1 Borderless Business: How Electronic Postage Technology Demystifies International Shipping By: Amine Khechfe, General Manager and Harry Whitehouse, Chief Development Officer of DYMO Endicia International Shipping White Paper

2 Borderless Business: How Electronic Postage Technology Demystifies International Shipping By: Amine Khechfe, General Manager and Harry Whitehouse, Chief Development Officer of DYMO Endicia The sage adage Think globally, act locally has never been more relevant to businesses especially those that ship goods. According to the U.S. Chamber of Commerce, roughly 96 percent of the world s consumers live outside the United States holding two-thirds of the world s purchasing power. Online auction giant ebay reports that 50 percent of its registered buyers live outside the United States. With e- commerce on the rise, and the Internet making the world smaller (85 percent of global Internet users shop online), businesses are missing significant revenue opportunities if they are not venturing into international trade waters. A recent report published by Forrester Research, Inc. entitled State of Retailing Online 2010: Key Metrics, Multichannel and Global Strategies Report, found that on average, online retailers in the U.S. who ship abroad report that approximately five percent of their revenue comes from foreign orders and more than half of retailers surveyed say they have seen increases in conversion rates over A similar survey conducted by Internet Retailer in 2009 found that 14.5 percent of the surveyed merchants who sell internationally reported more than 25 percent of their total web sales came from customers outside the United States. In the face of declining domestic business for sellers/shippers due to the economic downturn, adding international destinations could help make up for lost revenue and could create growth markets. In spite of the Obama Administration s mandate to double U.S. exports in the next five years, and measures crafted to promote open trade among countries, the perceived complexity of doing business outside the United States is daunting to many businesses. Navigating the complexities of international shipping - rate classes that change annually, tariffs and taxes in multiple currencies, the disparate shipping rules of numerous countries, plus the rigors of complying with customs documentation and reporting - can be overwhelming and major deterrents to pursuing international trade. For some businesses, the uncertainty over whether a foreign shipment will actually arrive at its destination is also a disincentive to get into the international game. Even companies with sophisticated logistics management systems struggle with complex trade rules and with streamlining the shipping process to make foreign trade cost-effective. Often, a company must change its warehouse workflow to process packages destined for international delivery. Page 2

3 Make no mistake - the functional and technical complexities of international shipping are real. However, the true barriers to expanding business growth through international trade are fear of the complex processes and of making costly mistakes, and lack of awareness of the solutions available today to effectively manage the entire international shipping process. The good news for businesses of all sizes is that there is a sophisticated, but simple-to-use technology that takes the mystery and risk out of international shipping: electronic postage. Electronic postage systems are software platforms that enable the online purchase and printing of U.S. Postal Service postage, from the computer, to be used for domestic and international mailing and shipping. The Postal Service delivers shipments to more than 200 countries, and electronic postage technologies have enabled businesses of all sizes to streamline both domestic and international shipping processes, saving countless hours and money. Today s best-in-class electronic postage solutions, like DYMO Endicia software, not only streamline postage purchase, but also handle all of the rate calculation and documentation required to ship accurately, efficiently and securely, both domestically and internationally. They also handle all customs documentation and reporting requirements, including U.S. Census Electronic Export Information (EEI) reporting. These solutions work on a standalone basis - ideal for small businesses and solo auction sellers. They also easily integrate with enterprise order and fulfillment management systems for larger volume shippers. Case in Point Chess House uses ebay and other online resources to market chess sets, equipment and educational supplies to individuals and schools worldwide. By using Endicia Premium shipping software, which is integrated into its other workflow systems, Chess House s international orders take no more than two minutes to fulfill, including the customs forms. According to Chess House owner Raphael Neff, DYMO Endicia is saving us several hours per week, which equates to thousands of dollars per year. The ease of processing international orders has truly made us global." Breaking Down the Barriers to International Shipping With international shipping, there are multiple forms to complete including the short (2976) and long (2976A) forms; multiple price schedules based on country groupings, numerous weight cutoffs and many shipping options, including three popular mail classes: Express Mail International (EMI), Priority Mail International (PMI) or First-Class Mail International (FCMI) from which to calculate shipping rates. There are also multiple discount tiers to consider: Commercial Base pricing for small to mid-volume Page 3

4 shippers; and negotiated discounted service agreements for high-volume shippers. In addition, each country has distinct rules and prohibitions as to what can and can t be shipped. For example, you can t ship ground cocoa beans to Germany. In short, there are a myriad of decisions to make and a wrong decision or miscalculation can easily result in a delayed, or worse, returned shipment. Today, electronic postage has demystified and streamlined foreign shipping, and made it a viable option for businesses of all sizes. All of the decision support and process functionality is built into the software. By simply entering the address, selecting the mail-class and weight, and declaring the contents, the software automatically calculates the rates, selects and completes the proper forms, and prints the postage, including all necessary documentation on a single label sheet which can be applied directly to the package for FCMI and PMI flat rate envelopes and PMI small flat rate box; or an automated, multicopy postage sheet and custom form, which can be slipped into a plastic postage sleeve for other mail classes. It is hardly necessary to make the trip to the Post Office. Most international packages can be picked up by USPS through free Carrier Pickup or by special arrangement with the shipper s local postmaster. (FCMI qualifies if shipped with at least one expedited EMI or PMI package.) Foreign shipping can also be time consuming. Prior to the advent of electronic postage, a shipper would have to contact the U.S. Postal Service via an 800-number, describe the shipment in detail and then wait for the postal clerk to calculate the rate class and price. Every form for every package had to be completed by hand. All too often, shipping outside the U.S. required a drop-off trip to the Post Office. Even for moderate shippers, foreign shipments translated into time and money ill spent. Based on our own research and feedback from customers, DYMO Endicia estimates that processing and preparing an average international order (for a small business that ships infrequently) can be reduced from 20 or more minutes to about two minutes using electronic postage. DYMO Endicia software includes a unique feature called International Shipping Advisor that takes the guess work out of the process, by providing the shipper the cost, weight/size restrictions, and delivery standards for the chosen mail class and destination. It also lists that country's prohibitions, explains its restrictions, notes any useful observations, and shows the areas served in that country for Express Mail International and the other mail classes. The DYMO Endicia software also allows shippers to insure packages at the time the shipping labels and forms are generated. The shipper is guided to the most appropriate insurance option for the product and destination and includes advice on excluded countries and how to complete claim forms. Guiding Shippers through the Maze of Government Rules Page 4

5 Perhaps the most confusing and intimidating part of the international shipping process is completing the required customs forms. Before electronic postage, customs forms had to be processed manually and involved multiple forms with obscure customs rules governing which form to use for a particular shipping application. DYMO Endicia was the first electronic postage solution to automate the production of customs forms, and has built customs-specific data for more than 200 countries into the solution. The software will advise the shipper which form to fill out and step them through the process. For shippers working with a small number of SKUs, item data can be stored and re-used to pre-fill forms. The solution can also pull item data from an external source such as an order processing or inventory system and pre-fill the customs form. Electronic postage also fulfills federal customs reporting requirements automatically for every shipping label produced. In September 2009, the U.S. Department of Commerce implemented rules requiring that all customs data be reported to the U.S. Postal Service and Department of Commerce. The DYMO Endicia software automatically transmits this data electronically. It also handles U.S. Census Electronic Export Information (EEI) reporting. With this level of functionality, it is no longer necessary to be a foreign trade or global logistics expert to successfully do business with a global customer base. Beyond processing the forms and postage, shipping a package overseas also requires an official U.S. Postal Service security seal - called the red round stamp - showing the current date and point of origination. Prior to electronic postage, a shipper would have to go to the Post Office so that a clerk could give the package a security stamp. DYMO Endicia is the first provider to offer a U.S. Postal Serviceapproved electronic round date stamp as part of its software. Today, the stamp is generated with the rest of the shipping forms and postage. Lastly, international shipments require a valid signature from the shipper. The electronic postage solution also provides approved shipper identification eliminating the need for a signature. For high volume shippers, that single step elimination can add up to significant time and cost savings. Case in Point MexGrocer.com: Based in San Diego, Calif. and launched in 2000, MexGrocer.com, is a nationwide bilingual online grocery store offering over 1,500 Mexican specialty products to Mexican food lovers around the world. Ignacio (Nacho) Hernandez, Jr., founder of MexGrocer.com, noted that initially the company s shipping model was a manual, time consuming process for managing and shipping international orders. Also, MexGrocer s costs to ship products internationally were exorbitant. After installing Endicia, MexGrocer.com cut its processing time by over 50 percent. The company increased its U.S. Postal Service shipping volume by 500 percent, adding more parcels to its daily U.S. Page 5

6 Postal Service package pickup plan. Implementing DYMO Endicia s shipping technology also enabled MexGrocer.com to save up to $28,000 on its annual shipping costs. Scalability and Customization Enable International Business Building Electronic postage is essentially a software application that can run on a desktop PC/Mac or on the Web. (DYMO Endicia is the only electronic postage provider to support a MAC platform.) DYMO Endicia software can scale to practically any sized shipping operation. The solution employs not only a clientbased option, but also offers a standards-based desktop XML interface, to enable large volume shippers to easily integrate all of the electronic postage functionality into their existing back-end sales order processing, inventory, or supply chain management systems - to virtually eliminate the possibility of shipping errors. To further streamline the International shipping process for e-tailers and fulfillment houses, DYMO Endicia works with more than 130 auction management and multi-carrier shipping partners to support numerous order fulfillment interfaces. These partners can take advantage of a fully scalable Endicia Label Server Application Programming Interface (API), which uses Simple Object Access Protocol (SOAP) based XML Web Services, to allow them to support USPS shipping without forcing their end users to install new software or change workflows. The Endicia Label Server system produces an integrated label image, complete with (stealth) postage, verified delivery/return addresses, and service barcodes (Delivery Confirmation, Signature Confirmation, Certified Mail, Express Mail, CONFIRM Services, or customs numbers). Even with a fully streamlined and integrated shipping label function, processing large volumes of labels one by one would still be inefficient, arduous and costly. That is why best-in-class electronic postage solutions like DYMO Endicia offer batch label printing modules. For high-volume shippers that ship a limited number of SKUs, the solution supports simple batch label printing. For warehouse and multiproduct fulfillment houses, the Endicia Professional service solution supports pick and pack order processing still delivering integrated shipping label sheets with all of the necessary postage, documentation and reporting. Harmonizing Shipping Drives Further Efficiency Another way electronic postage drives shipping efficiency is the ability to use Harmonized Tariff Schedule (HTS) codes to quickly fill in product description information required for customs reporting. The HTS code is a six digit number that represents a product internationally, and is recognized by every country. HTS codes streamline the customs reporting process significantly by providing standard, universally accepted product descriptions. The U.S. Department of Commerce maintains a database of standard product descriptions, based on HTS codes. This database information is integrated into the Endicia Page 6

7 software, so users have the ability to select the HTS number for a product and have the HTS product descriptor information passed through to auto fill the software s product description field. In high-volume shipping operations, the HTS code can be tied to a product s SKU number so it applies to all like products in inventory. For companies that already manage HTS codes as part of their product master, the codes can be pulled into the Endicia software using a simple, one-time system integration step. Reaching a Very Special Foreign Consumer U.S. Military Shipments U.S. households and charitable organizations ship thousands of packages to family members and friends serving abroad. This offshore consumer base also represents a considerable customer base for mailorder businesses. Mail to an Army Post Office / Fleet Post Office (APO / FPO) address is a unique mailing category that uses domestic mail prices and in most cases requires customs forms and the red round date stamp. Prior to electronic postage, packages mailed to APO/FPO destinations had to first be delivered to a Post Office to receive the required round date stamp. The resulting backlog in shipping was a source of frustration for families and considerable inefficiency for businesses. DYMO Endicia was the first electronic postage provider to offer APO/FPO shipment support, including all of the required forms, signature verification and the security stamp. Shippers using Endicia Premium and Endicia Professional service solutions or the Endicia Label Server Web service API can electronically generate a combined shipping, postage and customs declaration label bearing the required electronic round date stamp needed for shipments to APO / FPO addresses. As a result, these packages no longer need to be taken to the Post Office for round date stamp processing. Instead, a postal carrier can pick them up, thereby providing considerable time savings for shipping to military addresses. Case in Point Soldiers Angels which delivers care packages to U.S. soldiers deployed overseas - typically, ships 500 to 2,000 care packages a week with the help of one full-time employee and a handful of community and military volunteers. However, in the weeks leading up to Christmas, care package orders can escalate to almost 18,750 orders a week for an estimated total of 75,000 packages during the holiday season. The demand for packages typically exceeded the supply because packages mailed to APO / FPO addressed have to first be delivered to a Post Office to receive the required round date stamp. Since it began using DYMO Endicia technology Soldiers Angels has increased shipments to soldiers by five-fold to over 1,000 per day during the busy holiday season. Page 7

8 Opening Doors to Global Expansion With the right electronic postage solution, international borders can literally swing wide open for U.S. companies that are eager to accelerate revenues without shouldering the added responsibility and cost of coordinating and managing the complexities of international shipping. In the simplest terms, electronic postage has taken a multi-step, complex, confusing, time-intensive paper process one fraught with risk and streamlined it into a simple set of clicks and some basic information entry to deliver a single integrated sheet with postage, customs forms, delivery information return address and all required customs data, including description, quantity prices country of origin. DYMO Endicia has been offering postage technology solutions for more than 25 years. By eliminating complexity, streamlining process and providing scalability and customization in international shipping, DYMO Endicia s electronic postage solution is helping make business borderless for companies of all sizes. ### U.S. Postal Service, USPS, Priority Mail, Express Mail, Express Mail International, Priority Mail International, First-Class Mail International, CONFIRM, Certified Mail, Commercial Base, Carrier Pickup, Post Office, Delivery Confirmation, and Signature Confirmation are among the many trademarks of the United States Postal Service. All other trademarks are the property of their respective owners. Page 8