Shipping products internationally can be an excellent way to reach new markets and grow your business. Unfortunately, delivering goods across borders is rarely a simple task. This is something many e-commerce vendors and smaller companies have begun to discover as they jump into global trade just to encounter problems with customs management and complex documentation.
As the market for cross-border shipping and logistics continues to grow, expected to reach a value of more than $67.22 billion by 2027, leaders of growing businesses need to ensure that they're prepared to address the challenges these new processes can bring.
A simple mistake can be enough to cost you significant time, money, and even customer relationships. Here are some of the most common cross-border shipping challenges businesses face and how you can overcome them.
1. Customs Compliance
Perhaps the most obvious and significant cross-border shipping challenge faced by businesses today is complying with an ever-changing array of customs guidelines. Every country has unique concerns it needs to address with its customs policies. Failure to adhere to these guidelines puts you at risk of shipping delays and even products potentially being rejected from certain locations.
To address this challenge, companies need two things. First, you need a clear understanding of what the customs guidelines are in the countries you're targeting. Conduct extensive research into the latest regulations, and make sure you're aware of which countries have the strictest rules.
Secondly, you need the support of a partner who can help you navigate customs and border issues. Third-party logistics providers, freight forwarders, and other partners can help you mitigate customs problems by offering step-by-step guidance through the shipping process
2. Insufficient Documentation
This challenge often goes hand in hand with the issue of customs compliance. To ensure your shipping process goes smoothly, you need to have the right documentation prepared. Even for a short shipping journey like from the UK to Europe or from the US to Mexico, there are various pieces of paperwork you'll need to have completed before the journey begins.
First, make sure you understand the different types of documents necessary for international shipping and how they vary. For instance, if you're working with a trusted party or shipping goods that have already been paid for, you might use a waybill instead of a bill of lading.
Next, make sure you have a smart strategy in place for organizing and managing all of your documents. Manual document generation and collection can often lead to costly delays and a higher risk of errors. Digital platforms can make it easier to scan, analyze, and manage your documents all in one place.
3. Rising Tariffs and Unpredictable Costs
Tariffs are a political tactic used in international trade to negotiate the export or import prices of products that benefit a country. These costs can change constantly, making certain shipments more expensive and others more affordable. This can make it extremely difficult to budget for your shipping process, and so to maintain a consistent cash flow.
At the same time, other costs can emerge throughout the shipping journey, such as detention and demurrage charges, which impact your bottom line. While you may not be able to eliminate the unpredictability of pricing in the logistics field, you can ensure you're more prepared for it.
Using shipping software and online platforms that give you automated, real-time insights into changing rates can assist you in making intelligent shipping decisions. The platforms you use can also help to track changes in shipping prices throughout the year so you can more accurately prepare for seasonal changes in costs.
4. Problematic Brokers or Carriers
Working with the right carriers and partners is a key element of effective cross-border shipping. Whether you're using sea, land, or air freight, the right carrier will be crucial to the efficiency and overall outcome of your shipping process.
The best way to ensure you're selecting the right partners is to conduct extensive research. If you're working with a freight forwarding partner, learn as much as you can about the carriers they partner with and their reputation. A good freight forwarder will prioritize vetting carriers and ensuring they perform according to your expectations.
If you're working with carriers directly, ask for insights into how they protect their customers, request case studies and testimonials, and look for a track record of previous shipping issues. Be wary of any carriers or brokers who can't provide comprehensive evidence of their ability to preserve and protect both your reputation and your products.
5. Lack of Visibility
Finally, one of the major challenges of cross-border shipping is that it can be extremely difficult to keep a close eye on your products as they move across international boundaries. Over 69% of companies say they don't have full visibility into their respective supply chains.
This lack of visibility makes it harder to establish an efficient logistics process, accurately estimate arrival times, and deliver a consistent customer experience. Working with a digital freight forwarding platform or leveraging online tools that allow you to track the progress of shipments automatically in real-time can help with this.
These digital tools will provide you with an easy way to monitor your containers across various multimodal freight routes. Some solutions can even send you automated alerts and notifications when your shipments encounter delays. This makes it easier to rapidly implement new strategies or simply keep customers updated on the whereabouts of their orders.
Overcoming the Challenges of Cross-Border Shipping
As globalization continues at an accelerated rate, countless companies worldwide are beginning to step into the complex world of international shipping. If you need to reach new markets and consumers in different regions, it's important to understand the unique challenges you might face in a global landscape and how you can overcome them.
If you are adequately prepared to address issues like a lack of visibility, poor carrier relationships, changing tariffs, poor documentation, and customs clearance, you can give yourself a crucial edge in a competitive market. Plus, you can save time and money and reduce your risk of reputational damage, too.
