Daily Archives: October 21, 2011

Can Electronic Postage Really Demystify International Shipping?

A recent white paper by DYMO Endica claims that Electronic Postage Technology Demystifies International Shipping. Needless to say this got my attention because, being aware of the dozens and dozens of issues that can arise in international shipping, postage usually doesn’t make the list.

The paper starts off with some facts that every supply manager needs to know, which include:

  • 96% of the world’s consumers live outside the US and collectively hold two thirds of the world’s purchasing power
  • currently, US-based online retailers that ship abroad acquire 5% of their revenue from foreign orders and this number is rising
  • 14.5% of retailers that ship abroad see more than 25% of total sales from foreign orders
  • rate classes that change annually, tariffs and taxes in multiple currencies, the disparate shipping rules of numerous countries, plus the rigours of complying with customs documentation and reporting are just a few of the challenges of international shipping

And then defines electronic postage systems as:

      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

which is the proper definition of a country-based electronic postage solution. But how does that address the issues of tariffs, the disparate shipping rules of multiple countries, and the rigours of complying with customs documentation? All a typical electronic postage system does is insure that you apply the proper amount of postage (assuming you enter the proper dimensions of the packaged item and the proper weight and choose the proper shipping method, as the system looks up the rate from published rate tables). Now, some solutions from private industry will also produce the necessary documentation, given the necessary information, but then you are venturing into the territory of customs and trade documentation solutions. By definition, an electronic postage system does not produce customs documents. And you need to know how to answer the questions correctly (in what is typically a wizard-like interface) to get the right documentation.

In other words, if you integrate an electronic postage system with a trade and customs documentation system, you will simplify the trade process, as you will know how much you have to pay and what documents you need to include, but you will not demystify it. Many of these regulations are complex, with even more complex classifications for goods (for example, referencing HTS codes, a printer shipped with an installed cartridge is not the same as a printer shipped with an uninstalled cartridge). If you don’t understand the rules and regulations of where you are shipping, and the terminology used by the application, you will still be lost. There’s no magic demystification that occurs simply with the acquisition of such a solution.

However, if you understand the basics of international shipping, and the mandatory rules and regulations of the country you are shipping to, I do believe their claim that average shipping time can be reduced from 20 minutes to 2 if the software is in the hands of a professional in international shipping and logistics.

If you’re a small to mid-size business getting into the international direct-to-consumer shipping game, the white paper is definitely worth a read, but don’t get taken for a ride on the magic carpet. Simplification is not demystification, and you’ll have to learn a little to get a lot from this type of solution.