Retailers Need to Understand International Shipping

Oct 16, 2012 1:39 AM  By

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Multichannel Merchant
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Multichannel Merchant
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U.S.-based retailers looking to get into international shipping should expect to see an increase in revenue, according to Craig Turnbull, CEO of Bongo International, just as long as they understand the market, the shipping industry and the needs of their customers.

“There is an opportunity to increase revenue from 3% to 10%,” Turnbull said during a recent phone interview.

Toys R Us recently just announced that it is now offering shipping to over 60 countries across the globe. This move, Turnbull said, is a “positive step” for the toy company and a perfect way to capture missed sales opportunities that come from “cross border ecommerce.”

In fact, Turnbull said, 16% of all web traffic that heads to U.S. ecommerce sites are international shoppers. According to the New York Times, in December alone 14% of the visitors who went to jcrew.com, and 36% of Abercrombie.com were visitors from outside the U.S.

But don’t think that if your company decides to go international it will mean an instant increase in dollar signs. A lot of work and research needs to go into making sure your company is ready to go international.

According to Turnbull, before jumping the global gun, retailers need to make sure they offer every payment option that is used in the country they are shipping to. Not every country, he said, accepts the major credit cards used in the United States.

Turnbull said that since fraud is four times higher internationally compared to domestic, retailers also need to make sure they are fully protecting. In fact, according to CyberSource Corp., an electronic payment and risk management provider, “International orders are more than three times as likely to be fraudulent.”

When it comes to getting involved with international shipping, retailers need to educate themselves on the cost differences that come with shipping domestically versus shipping internationally. Turnbull suggested that since shipping out of the U.S. is eight times more expensive, retailers need to give customers accurate quotes on fees or else they are the ones who suffer the financially consequences.

“These are things [retailers] absolutely need to address before getting into international shipping,” Turnbull said.

Erin Lynch is the associate editor at Multichannel Merchant. Erin can be reached at 203-358-3755 or by emailing her at erin.lynch@penton.com. You can also follow her on Twitter at @LynchMCM or on LinkedIn.