Practical Ecommerce

How To Rate-Shop International Shipping

U.S. export sales are increasing, which makes international rate shopping more important than ever. For example, here are published rates for a typical 10-pound parcel sent from my fulfillment company located in Traverse City, Mich. to a client’s customer located in London, England.

  • UPS Worldwide Express (1-3 days): $166.98
  • UPS Worldwide Saver (1-3 days): $160.91
  • UPS Worldwide Expedited (2-5 days): $148.54
  • USPS Global Express Guaranteed (1-3 days): $132.53
  • USPS Express Mail International (3-5 days): $68.08
  • USPS Priority Mail International (6-10 days): $52.68

As you see, the potential cost spread for this typical package is over $100. And if you ship in volume, picking the wrong shipping method could cost hundreds of thousands of dollars a year.

Calculation of International Delivery Rates Is Complicated

Most international parcel shipping services are provided by FedEx, UPS and the U.S. Postal Service. The cost factors are so complicated, it is best to use the online price calculators provided by each carrier to do your rate shopping, as follows.

Package size relative to shipping weight is an important cost consideration as international rates are subject to dimensional weight minimums plus there are intricate rules that involve product limitations, valid addresses, insurance coverage and so forth. To read more on dimensional weight issues, see “Shipping: Dimensional Weight Errors Can Cost Big Bucks,” which I wrote earlier for this publication.

USPS Priority Mail International Is the Most Popular Ship Method

My company ships about 120,000 international packages a year and the vast majority of these are shipped via USPS Priority Mail International, although packages under four pounds are sometimes sent via First Class Mail International (which does not provide tracking) because of the lower rates.

You can use the USPS online rate calculator to process your own international packages right from your desktop. You will need to know the destination country, package weight and dimensions, plus the product description and customs value for each package. You can print your shipping labels and customs declaration forms from the online system or you can order a supply of free customs forms online from the USPS store.

Priority Mail International Flat Rate Boxes Could Save Even More Money

The USPS offers international flat rate delivery just as it does domestic delivery, and if your products have sufficient shipping weight per cubic inch to make the numbers work; this feature could save you considerable expense.

International Shipping in Volume Requires Some Added Technology

The online postal calculator is good for low volume international shipping, but larger processing volume will require an automated system. There are many choices available, such as Stamps.com and Pitney Bowes, but we use Endicia.

You can hand enter individual package information or preload batches of addresses as files. The system calculates your postage and prints a USPS label plus the needed customs declaration forms automatically.

If you ship a large number of packages that all have the same contents, you can print your labels and customs forms as a batch to speed your pick, pack and ship processing. This is what my company does whenever we can.

Priority Mail International includes delivery confirmation tracking and limited insurance, but it is a good idea to add extra insurance for valuable packages when needed.

International Mail Consolidators Can Save Even More Time and Money

As your shipping volume grows, you may wish to consider use of an international mail consolidator service. This is a company that gathers thousands of international mail packages from its clients and delivers them directly to the postal system of each destination country.

Depending on the services you use, an international consolidator can both speed your package processing and provide good postal rate discounts.

Using the search term “international mail consolidators” you will find dozens of companies that offer this service although the one that we use is UPS Mail Innovations.

Some Fulfillment Companies Have International Branches

If you outsource order fulfillment, there are some U.S. fulfillment companies that maintain branches in different countries. You can also contract directly with a non-U.S. based fulfillment house. This requires you to split your inventory plus pay the extra duties and freight costs to the foreign location, but this is a way to speed delivery of export orders.

Duties and Taxes Are Always an Issue

Most of our clients ship their international orders with import duties and foreign taxes paid by the customer upon delivery. In Canada, there is an extra $5.00 processing fee charged by Canada Post to cover collection of these taxes and fees. UPS and FedEx provide a brokerage and collection service, too, but the cost is much higher. A good resource on this topic is the USPS international guide.

Extra Packaging Is a Must

Domestic parcel processing systems are hard enough on shipping cartons and protective wrapping, but international shipping is even more demanding. The best international packing technique is a box within a box with paper or bubble wrap between the inside and outside cartons.

But, if this is not affordable in your business, a good alternative is use of heavy-duty cartons (ULINE is a good source) and extra interior wrapping. Either way, it is vital that your shipping label shows both your return address and the delivery address clearly and completely.

Summary

Export sales volume is increasing and this makes international rate shopping an even more important part of your order processing management. Use of the UPS, FedEx and USPS online pricing systems is the best way to rate shop because of the complexity of the many shipping alternatives and the huge cost differences involved. Plus package processing automation, parcel consolidation services and possible foreign warehouse solutions can further add to your cost savings over time.

John Lindberg

John Lindberg

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  1. Stephan Roode February 24, 2012 Reply

    ABOL Software is a multi-carrier shipping software solutions provider with carrier compliance for over forty national and international carriers. We can help parcel shippers determine best rates, routes etc for international parcel delivery and provide the tools to integrate with existing business systems. Please contact us for any help. www dot iabol dot com

  2. Tracy Baker Coe May 14, 2013 Reply

    Great information, John. I’m in Traverse City also and was pleasantly surprised to realize you wrote this article. I actually used to share space with you. I am thinking of expanding internationally and plan on stopping in to talk with Jordan soon. Thank You.
    Tracy Coe
    http://www.hazelnutkids.com

  3. Jane Sommers July 15, 2014 Reply

    You guys want a real quality USPS re-seller? These guys don’t offer many services, 4 international and 6 domestic, but from what they offer they are pretty much the cheapest around for USPS stuff. I been shipping all the clothes from my store using USPS and thought it was the cheapest way until I found a site that lets you print USPS labels and then drop it off at USPS stores or have USPS drivers come pick it up. Anyway I got 15% off International USPS Priority and 20% off USPS International Express. So it’s a big difference and when I called I was told that if I do x amount a month I can get even better rates. Even the first class rates was by about 10-13% lower than anywhere else. The link to get the 15% off on priority and 20% off on express is https://vipparcel.com/registration?code=LUYF. Without it you just going to get 10% and 15% off. Or call the it 844-Parcel5. It’s a small company, so they are really trying to get your business. Ask to speak to Peter Repik. He is a Sales manager. He actually makes the decision on what rate each business gets. Tell them what your business is shipping and depending on the volume they can give you discount up to 30% off USPS rates.

  4. jrburton May 19, 2015 Reply

    just wanted to know who the best package transportation company was by efficiency, volume , and $. New @ this Internet crap, just wanted to know. Simple question; I’ll try your answer (till I figure out how to get a second one).jb

  5. Amy Washington September 21, 2016 Reply

    It looks like this article and thread may have fallen into the abyss but I thought I might chime in and give my two sense.

    The challenges I have struggled with around international sales are really two parts.

    First, and I won’t dive too deeply as its more related to the merchant service and credit card processing side of the business, but merchant services and payment gateways have yet to deploy a system that roots out fraud. The unfortunate fact is that assuming a customer abroad uses a fraudulent credit card it will almost certainly slide through the gateway and merchant services as a good sale, then deposited into the retailer bank account, only to be identified as suspicious weeks later. Naturally the banks reach in and extract the fraudulent funds and leave the retailer holding the bag.

    The other side of it the logistics, and more precisely the competitive or noncompetitive pricing leading to sales.

    Amazon.com has been a steamroller throughout the marketplace and many would argue the vast benefits it has brought with it byway of competitive forces. Amazon has been a God send to many particularly small businesses who without the Amazon marketing advantage would be little more than a doodle on the back of a napkin at the looking drinking hole. They are great at reaching a domestic consumer and their impact in the larger international space is growing fast.

    But for those of us who try to sell through our own website, foregoing the massive commissions paid to the behemoth, it can be a little daunting to tackle the international shipping.

    First, the rates. Getting rates that compete is tough. Have you seen the retail rates from Fedex, DHL, or TNT? They are insanely expensive and unrealistic for a retailer. I negotiated rates with UPS, TNT, and DHL, but the results were not good. Not enough volume to drive real discounts. This is when competing with Amazon makes you feel really really small.

    I’m measuring the percentage of lost business against incremental increases to shipping rates and its extreme.

    Frankly, as a seller who has evolved through the past decade of Amazon ups and downs I’ve learned through heartache and loosing lots of money, whether through BiG Bank Merchant Services who take no prisioners or the hefty costs for international shipping. Where I have moved my inventories is away from Amazon and FBA and into fulfillment centers capable of handling all my logistics issues.

    For instance, reverse logistics. For those of you who may be new to the term, it refers to the process of returning merchandise from end consumer to merchant. Managing this with international customers can be complex. Additionally, fulfillment centers offer volume rates I’m not able to get on my own with the aforementioned carriers; UPS, FEDEX, DHL, TNT. Rather, the fulfillment operations I work with tend to be flexible and understand the cost correlation associated with international sales.

    The fulfillment companies I have used are:

    Good – Amazon FBA
    Better – Shipwire https://www.shipwire.com/
    Best – Newgistics http://newgistics.com/

    I won’t ooze over any of them, but I’ll say that as my requirements have evolved FBA was incapable of keeping pace. With the other solutions I have full EDI integration by and between me and all my distribution partners. Partners that make life a lot more manageable.

    As for international shipping rates that beat retail published rates, check out these international shipping calculators:

    USPS – https://ircalc.usps.com/
    DHL – http://www.dhl.com/en/express/shipping.html
    MyUS – https://www.myus.com/pricing/calculate-shipping/
    American eBox – https://live.americanebox.com/Calculator

    These will at the very least send you in a direction that makes sense.
    I hope this personal recount provides help to those who are transitioning through differing stages of growth.