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Going global? A Commerce Department guide aims to smooth the way
The guide shows e-retailers the ins and outs of international e-commerce.
Topics: Bass Pro Shops, duties, international customers, international e-commerce, international shipping, International Trade Administration, Ken Walsh, legal/regulatory, product classification codes, product information, RedRocketHobbies.com, shipping rates, tariffs, Taxation, U.S. Commerce Department
The U.S. Department of Commerce’s Commercial Service this month released a guide that advises e-retailers on selling to consumers in other countries. The guide walks retailers through key points about merchandising, international product coding standards, taxation and tariffs, shipping rules and payments.
“A vast number of e-commerce retailers are missing sales opportunities and actively discouraging international orders because of the perceived complexity of selling to foreign customers,” says Ken Walsh, the general editor of the report, entitled “Preparing Your Business for Global E-Commerce.” The Department of Commerce hopes to help companies that want to begin exporting or establish exports as a larger percentage of their total sales, he adds.
The primer provides e-retailers with advice on where to locate the product information that is required by authorities for products shipped outside the United States, such as country of origin and product classification codes. In some cases, an e-retailer can get this information from its suppliers; in others, it can use online tools provided by the government. The guide shows e-retailers where and how to parse the resources available.
If e-retailers don’t properly fill out legally required paperwork, their international shipments may be held up or rejected when they arrive at their destinations. Product classification codes, for example, help communicate what tariff or duty rate must be paid.
An online search tool on the U.S. Census Department web site can help e-retailers determine which classification codes to assign to products and calculate rates. The guide explains e-retailer’s options on how those tariffs can be paid and the pros and cons of each method. An e-retailer may want to charge a flat fee that it estimates will cover tax, or leave the tax to be paid by the customer on delivery.
The guide also suggests specific wording that e-retailers can add to their sites to communicate purchase and shipping rates and return policies to international customers.
The free guide also includes contributions from three e-retailers about how they implemented and operate international sales. Bass Pro Shops, No. 72 on Internet Retailer’s Top 500 Guide, fills 800 to 1,200 international orders each week and has an employee wholly dedicated to directing its export-compliance program.
Managing the process in-house isn’t the only option. Toy e-retailer RedRocketHobbies.com describes how it outsources much of its international compliance and shipping processes to a vendor. International sales now make up 5% of the e-retailer’s sales.
The guide can be downloaded through the International Trade Administration web site at www.export.gov/ecommerceguide.