With the spread of globalization, the world has truly become accessible to everyone in every part of the world. You can be in any part of the world and can order anything that you want from the opposite side of the globe. Similarly, if you have family or friends located in any part of the world, you can ship them anything you want, whenever you want. All of this is possible because of international shipping.
Despite all the benefits involved in shipping goods from one continent/country to another, there is a huge cost involved to it. Did you know that if you ship a small package of goods from the U.S. to the U.K., it will cost you at least $40. In addition, this number increases as your package increases in size and weight. The cost for international shipping has increased by a minimum of 100% in the previous years. Despite the fact that each year, we are more connected with everyone around the world than ever before, but this rapid and continuous increase in the cost for delivering goods from one part to another is disappointing and alarming.
If you are not aware of what International Shipping means, then here is how we can define it in layman terms:
The process of sending imports and exports to different parts of the world through air, road, or ocean transports is known as international shipping.
According to a recent poll, a whopping 75 percent of the people who shop online expect free delivery. That’s every three in four people ignoring a great deal of hassle that goods have to go through when it comes to shipping or transporting; the fuel alone makes it so that ensuring free delivery on every item could make the retailer themselves go bust with just a couple of deliveries. And the same goes for international shipping. The costs are just astronomical for international shipping, which leads us to this question; why exactly is international shipping so expensive?
International Shipping is Complex, Which Makes it Expensive
For your UberEats to get you that burger and fries, there are a lot of behind-the-scenes things that are happening. Same is the case with an international shipment being delivered thousands of miles across the ocean, only all of those things and factors being taken for granted in a local delivery are being passed through international customs. All this mumbo-jumbo might seem a bit of an overkill, so let us simplify it for you.
If you buy a product from the UK and you reside in Australia, the distance itself is a big reason why shipping will be expensive. But then there are other things which have to be done prior to shipping.
The packing and delivering to the courier service will be handled by the retailer themselves, after which, the package will be labelled as ‘overseas delivery’, which would allow the Customs of the UK to poke in and see whether the product you want is legal for overseas delivery, isn’t evading custom taxes, and is perfectly legal to be imported to another state.
Once the package has been through Customs, the international shipping service will determine its weight and board it on the vessel, which could be either a plane or a ship, depending on the time you’ve selected for your delivery and the transportation method you’ve opted for. If the weight exceeds a certain limit, the shipment will then be done via water vessels and not a courier airline.
After this whole process, the item reaches you, for which you shell out some hundred dollars, disgruntled that international shipment is so expensive, not knowing the entire process through which the package goes and all the time and manpower spent on it. This is one of the major reasons why international shipments are so expensive.
At times, the cost of international shipping becomes so great that most people cancel their plans on getting their products shipped. You must be confused as to why international shipping is so expensive. To remove your curiosity and confusions, here is a list of 8 different reasons discussing why is international shipping so expensive:
Top 8 Reasons Why is International Shipping So Expensive?
1) Weight and Size of the Parcel
As you may have guessed, weight and size of the parcel play a very big role when it comes to shipping goods across borders. When it comes to weight, things are pretty straightforward and self-explanatory. The courier companies weigh different packages and then decide on the cost accordingly. It is obvious that every vehicle whether it is a ship, truck, or airplane can only carry a certain amount of weight on it.
This is why a specific amount of weight is allotted for each parcel and charges are made accordingly. If your parcel exceeds the weight, the cost to ship your parcel on an international scale increases accordingly.
When it comes to the size of your parcel, things become a little more complicated. As mentioned above, only a certain size and number of parcels/cartons can fit inside the vehicle responsible for transportation. This is why they charge for the parcel according to the box that it is placed inside. The charges for the box are imposed by measuring the size of the cube i.e. box.
In most cases they use the following formula:
Box Size = Length * Height * Width
The resulting number is then multiplied by their specific charges per cubic meter. Most of the time, the package weight and the size of the parcel amounts to an equal number but it may vary a bit. Most courier organizations consider the box size instead of box weight while calculating costs for your packages. Even though your box may weigh less, if the box containing the package is large, you will have to pay more.
**Note: Each courier company may have different standards and procedures that they follow while taking your package and set the prices according to their standards.
2) Shipping Transport Method:
Another really obvious determinant of price at this point is how the shipment is transported overseas. Only airplanes and ships are used for this, with each coming with their own sets of advantages and disadvantages. These also determine the price at which the item will be shipped; airlines usually charge more, but since air shipment takes two days maximum, the overall costs can be minimized. As for shipment using water vessels, which provide safety and relatively no weight restrictions, the costs are initially low as a bulk shipment is being carried by the ship (which drives cost down), but since it takes longer and the courier company has to factor in the costs of living of the crew on the ship, this can drive the cost up substantially.
3) Fuel Cost
Fuel plays a vital role in defining the cost of your international shipping. Each vehicle that is used to transport your goods from one place to another consumes some form of fuel. If you are up to date with current world affairs, you will know that fuel prices keep increasing. There is seldom any occasion or event in which the fuel cost is decreased; otherwise, they only go up with the passage of time.
The type of vehicle used to ship different packages plays a vital role in determining the overall fuel cost of the package. For obvious reasons, the fuel used in airplanes is much more expensive than fuel used in ships, which in turn is more expensive than the petrol or gasoline used in trucks. In most cases, international shipping involves an airplane or a ship in the ocean. Furthermore, once the package lands in the destination country/state/city, they have to get your package to the target through a truck or car. This further adds to the fuel cost.
In some cases, there are unexpected blockages in a certain predefined route. Because of this reason, vehicles, especially trucks often have to change their routes. This increases the total cost of the fuel. Most courier organizations are aware that these anomalies can happen in the route, which is why they charge slightly higher for fuel costs. Any unexpected journeys and the fuel consumed is covered through them.
If you want your products to be delivered as early as possible, most courier companies will charge you an extra amount for international shipping. When it comes to sending something internationally i.e. within a day or two, the cost can really add up to a huge amount.
Most couriers that need to be shipped within a day are mostly done through airplanes. As mentioned before, their fuel charges are higher hence the increase in cost. On the other hand, if you are in no hurry to get your product delivered, opting for a slow service which is done through a ship, can significantly reduce the overall cost of the package. If the whole shipping process is done through trucks, there are no additional costs but it will take a very long time for your package to reach its destination.
5) Type of Product
If your package is fragile and requires extra attention while being delivered, you can guess by now that it will cost an extra amount. This is because the courier company has to invest in keeping the products inside safe.
To ensure the safety of your packages, fragile products are mostly packaged in fragile friendly and water resistant boxes. They are covered with bubble wraps and damage-resistant cardboard. This packing material is also expensive and the company charges some extra bucks for it and the whole wrapping process as well. This is commonly known as the special packaging cost in most courier organizations and is mentioned explicitly on the receipt.
6) Value Added Services
Some people like to make things a little more fancy while sending different products internationally. For example, along with a nice perfume, they might ask the courier service to buy some flowers or cake before dropping off the parcel. This adds a whopping amount to the total cost of international shipping. Most ecommerce businesses charge large sums of money in such scenarios.
It is to be remembered that the value added services cost is separate from the international shipping cost. Some people tend to mix both of them up and assume they are the one and the same thing. These are the costs that are charged by the courier services. It is completely avoidable if no extra services are requested.
7) Shipping Distance:
The second biggest factor that determines the price and the total amount to be paid to the courier service is the distance, which as logic would have it, the more the distance, the more the price. This is where bulk shipment and price drops come in, but they can slash only so much, which would still burn a good hole through your wallet and your pocket. Still better than paying full for it.
Keeping this analogy in mind, you can now understand why it costs so much to ship a product overseas, all the while customers want free shipping. However, it’s important to note that while distance does determine price, this is not always the case, especially with sea or air courier. Because the fuel, time and distance has been pre-calculated and already been accounted for, making a short-distance trip actually costs the service more, which is why sometimes long-distance shipments are preferred as they keep the overall costs down. Now you know.
If you have been to the airport, the bus station, or even the shipping docks, you will know for sure that additional costs are incurred during inspections. At any given time, your vehicle can be stopped and the luggage inside is examined and inspected by several different people in the country. This is the usual protocol. These inspections can cause time delays and increase the cost of different shipping as well. Sometimes, the luggage in a vehicle is kept in a store on the docks or port for many days. Courier companies have to pay rent for those places as well. This cost is also a part of the international shipping.
Some countries have additional taxes for exports that come into their ports. The entire process of shipping things internationally is heavily taxed in several different regions of the world. The courier company covers all these costs. All the charges, which include obvious taxes, are explicitly mentioned on the receipts given to customers at the time of shipping. Any hidden charges that may be incurred by the country are included in the overall cost of the package.
There are multiple agreements done by the courier companies with different counties. These agreements are renewed and taxes are often revised which in turn makes international shipping even more expensive.
Saving Money on International Shipping
Here is how you can save money on international shipping:
1) Explore All Options
There are multiple options in the market when it comes to international shipping. You do not need to pick the first one that comes your way. Go to at least three different vendors and pick the one that seems to be most reliable and cost-efficient. It is important to remember that even though higher rates for shipping may seem like good options, they are not necessarily the best ones.
2) Do Not Pick Value-Added Services
There is no need to ask your international shipping courier services to deliver other things such as flowers, sweets, or cakes along with your package. If you really want to do that, consider using the services of another ecommerce service provider in the region. They are more likely to charge reasonable rates.
3) Pick the Slowest Delivery Method
There is no need to rush the process of international shipping. It does not matter whether your package reaches the recipient in a week or two. This is because the service charges an arm and leg on a quick delivery. Place your shipping order one month prior to the date you want it delivered. This way you are always in the safe zone and can easily get the package delivered on the desired time.
Cheapest Method to Ship Internationally
When all is said and done, everyone wants a method to ship his or her products internationally and in the most reliable form possible. Well, the most effective and cheapest method to send someone a gift or a package internationally is through the means of a ship in the ocean. Even though it may take up to three months for your package to reach its destination, the prices are comparatively lower and won’t bankrupt you for the rest of the month.
On the other hand, if you have a product that you want to ship internationally in a bulk, then you may consider options for air transport as well. This is because their rates eventually lower down a lot more and become quite reasonable.
There are many factors that also weigh in where costs are concerned; however, these three are the major ones. International shipments only cost reasonable when a bulk shipment, carried by a water vessel, is bound for a long-distance target. This drives the overall cost down, translating into lower costs for the end customer, not to mention good savings and operating costs for the courier company as well. All in all, international shipments cost so much due to the very complex and numerous procedures and protocols behind it, not to mention the various Customs and procedures it goes through before it even leaves the place from where it is initially bought online.
If you are an individual sending a small gift to a person internationally, it is better to not follow through with it. Instead, you can find ecommerce business owners in the same country as the recipient and utilize their services instead. They may charge a minor shipping fee but it will be drastically less than the international shipping cost. While business owners sending their products in bulk, must explore the courier market before finalizing one so that they are not charged any extra money.