The process of finding a cross-border provider has been discussed previously and is an important consideration for B2B and B2C shippers in the US and globally. New considerations, however, have come up recently with the concept of international fulfillment. Fulfillment is defined here as, “the tendering of some or all aspects of inventory, storage, picking, packaging, and final transportation of products to the end recipient.” As e-commerce grows both in the US and globally, fulfillment has become an attractive option for shippers. With that said, international fulfillment does pose a few unique considerations that are distinct from cross-border itself.
- Why do I think my products will be a good candidate for export shipping by use of a fulfillment provider?
- Do I export from the US or fulfill from a warehouse in another market?
- Do returns factor into my supply chain, inventory and overall experience?
Why do I think my products will be a good candidate for export shipping by use of a fulfillment provider?
Simply put, there are two main reasons why a customer will shop abroad:
- The product is not available in their home market.
- The product is cheaper or of higher quality abroad.
From a cross-border perspective, knowing the markets you wish to open for exportation from becomes critical. Many factors will go into this decision making, including the whether the product itself can be sold in a destination market, the potential of the product being sold in a destination market cannibalizing existing sales and if there is even demand for the product in the destination market. With more than 78% of the global B2C e-commerce market outside of North America (according to PayPal, 2016), this becomes an issue of great importance.
Do I export from the US or fulfill from a warehouse in another market?
The cost of exporting from the US has been an issue that has vexed shippers for many years. In the age of e-commerce and free shipping, this issue becomes more important. Finding a fulfillment partner who can then source the inventory in bulk in a destination market then becomes a source of cost savings and efficiency.
Some key questions an e-commerce shipper, in particular, should consider when examining international fulfillment options include:
- Does my fulfillment provider have experience in shipping e-commerce products to these markets?
- Who will complete the international paperwork and what is the limit of liability if something goes wrong?
Finding a fulfillment partner experienced with international shipping is important, especially when one considers how often shipments can potentially be held up in customs due to insufficient paperwork or information. Knowing what the partner’s experience is with customs paperwork — and how they remedy potential delays — becomes a key component of partner selection.
How do returns factor into the strategy?
Ah, yes, returns — a topic that vexes shippers in the US but can have serious cost consequences globally as well. This is the single biggest area where a fulfillment provider might have advantages, as they might be able to help in one of three ways:
- Enabling returns in bulk back to the US.
- Having an in-country liquidation partner.
- Having relationships with local in-market parcel providers who can help reduce costs.
International shipping is complex, and a fulfillment partner can reduce the anxieties associated with those complexities. Finding the right partner, however, involves a keen understanding of your product and the destination markets in question, as well as how the fulfillment partner will attend to your specific needs.
Krish Iyer is Director, Strategic Alliances, ShipStation. An expert in cross border e-commerce, international fulfillment and supply chain technology, he has more than 16 years of industry experience with FedEx, Pitney Bowes, Neopost, and ShipStation.