Where U.S. e-Commerce Businesses Should Be Shipping Internationally
When mid-market retailers think about growing their businesses, they often plan for domestic activities—such as advertising campaigns to expand their customer base or partnering with a third-party logistics (3PL) provider to improve their immediate geographic reach—rather than shipping internationally.
But there could be a huge missed opportunity with that strategy.
To understand the full potential of international shipping (among other major trends in the world of e-commerce), we partnered with ShipHero to create the 2023 E-commerce Shipping & Fulfillment Benchmarks Report. In chapter 5 we uncovered some staggering stats around international shipping.
Among those stats we found that, although the global e-commerce market is projected to reach $4.11 trillion in 2023, the percentage of merchants shipping internationally ranged from just 32.76% to 53.29% across six core categories (apparel, beauty/skincare, electronics, health/wellness, jewelry, and sports/outdoors).
Ultimately, what this means is that there’s a tremendous opportunity for U.S.-based retailers who are willing to make the leap to establishing an international presence if they know how and where to start.
Why U.S.-Based E-commerce Merchants Should Be Shipping Internationally
The most obvious reason to ship internationally is to access new markets of buyers, including those your competitors may not yet be reaching. Unfortunately, too many sellers write this opportunity off, given the perceived difficulty associated with international delivery.
However, this is an outdated view. Both carriers and shipping software providers like Shippo have taken a number of steps to streamline the international shipping process, including reducing redundancy in user flows when it comes to completing shipment information.
That, alongside a number of cross-border shipping improvements such as digital customs clearance allows you to safely send packages across the globe without the free of your customers orders getting stuck at the border.
What to Know Before You Ship Internationally
That said, before you dive into the world of international shipping, there are a few things you’ll need to know:
Getting your documentation right is a must
Without the proper paperwork in place, your items may be held up in transit, causing frustration for your customers. Some of the international shipping documents you may need to deal with include proforma invoices, commercial invoices for export, customs invoices, certificates of origin, and export declaration forms, among others.
You’ll want to plan ahead for customs fees and other costs
Import duties and taxes are assessed on every international shipment, though the amount you’ll pay varies based on the type of items you’re shipping, their value, where your items were manufactured, and the country you’re shipping to. Customs fees and other costs can be paid by you or your customers, but you’ll want to finalize how you’ll handle them ahead of time so that there are no surprises upon delivery.
Transit times vary based on carrier, shipping service, and destination country
Shipping small items from the U.S. to Canada using an expedited service may not significantly slow down your transit times, but shipping to remote destinations or rural areas can cause considerable delays. Since you’ll want to communicate expected transit times to shoppers before they purchase, it’s a good idea to use a service like Shippo to estimate delivery speeds for the destinations you’re planning to ship to in advance.
Best Countries for International Shipping Out of the U.S.
If you’re just getting started with international business, keep in mind that “shipping internationally” doesn’t have to mean shipping to the entire world at once. You can test the water first with a few select destinations.
The following countries all represent good starting points, due to both the size of their e-commerce markets and the ease of reaching them with common shipping services from the U.S.
Shipping to Canada
Canadian e-commerce sales are expected to hit $33.3 billion in 2024, thanks to widespread adoption across the country. According to the International Trade Administration, 75% of Canadians—totalling 27 million individuals—are active e-commerce buyers.
Even better, common carriers have made it extremely easy to ship packages between the U.S. and Canada. As a result, it should come as no surprise that our Benchmarks Report found Canada to be the top international shipping destination for retailers of all product categories in terms of the total number of packages shipped.
Shipping to the U.K.
According to our Benchmarks Report, the U.K. is the second most popular destination for shipping out of the U.S., due to its large number of e-commerce users—the second-largest number of online shoppers of any European country—and its shared use of the English language.
In addition to the usual considerations associated with shipping internationally, retailers thinking about shipping to the U.K. should be aware that the U.K.’s succession from the European Union (EU) means that it is no longer subject to the EU’s Single Market and Customs Union. Prepare for value-added taxes (VAT) to add up to 20% of your product’s value to your shipping costs.
However merchants can take the Delivery Duty Unpaid (DDU) approach so that they pass that additional cost onto the customer. While this may inhibit you from making an initial sale, you can ensure that the sales you do make are more profitable. You can always adjust this strategy later depending on your results.
Shipping to Australia
Shipping to Australia—the third most popular international shipping destination in our Benchmarks Report—is a great choice, given that the country’s total e-commerce revenue is projected to reach more than $43 billion this year.
If you sell agricultural products, animals, mining or construction machinery, or certain packaged foods, be aware that the Australian Customs Department has strict quarantine rules that could affect your shipments’ transit times. Other goods that may pose a threat to public safety or introduce new pests to the island nation may be subject to additional scrutiny or require extra paperwork.
Take the time to familiarize yourself with these and other requirements if you’re thinking about shipping to Australia. Also, keep in mind that transit times are longer, and with longer transit times comes the increased risk of damaged packages on arrival. Consider using shipping insurance for high-value items traveling to Australia.
Shipping to Germany
Germany is a particularly popular international shipping destination for retailers in the beauty/skincare category, according to our Benchmarks Report. But merchants in other categories can still benefit from shipping to Germany given its wide embrace of online shopping—e-commerce revenue in the country totaled 99.1 billion euros in 2021.
Like Australia, Germany places additional restrictions on the import of sensitive items, such as chemicals, currency, and medicinal products. Other products—including perishable items, animal products, and cultural assets—are outright prohibited. For more rules and regulations, check out our guide to shipping from the U.S. to Germany.
Shipping to France
France’s total e-commerce market is expected to reach $203.57 billion by 2026, so it should come as no surprise that our Benchmarks Report identified the country as a top destination for apparel, beauty/skincare, and jewelry deliveries from the U.S.
To be successful in this market, however, be aware that France takes consumer privacy seriously. If you aren’t already GDPR compliant, consider taking this step before shipping to France. You’ll also want to familiarize yourself with Harmonized System Codes—all U.S. shippers need to include HS codes when mailing to EU countries, including France (and Germany), as of March 2023.
Shipping to Mexico
Mexico’s proximity to the U.S. makes it an ideal starting point for international shipping, as proven by the $289.5 billion dollars worth of goods exported to the country from the U.S. every year. Its proximity allows you to use ground shipping services which are much more cost-effective than carrier services that require air travel. This means cheaper shipping for both you and your end customer.
Like Australia and many other international destinations, Mexico prohibits the import of specific products, including live fish, narcotics, and firearms. Other items are restricted—this list from the ITA can help you determine whether the items you sell are eligible for shipment to Mexico.
Keep in mind that due to the country having a different primary language, you’ll want to make sure both your website has the capability to be translated and that you look to selling on popular online marketplaces within that country to get better visibility.
Shipping to China
Despite China’s massive market opportunity—its value is projected to reach $4 trillion by 2026—the country did not crack the top five international destinations identified by our Benchmarks Report.
While this may mean that China represents an untapped market for your business, it’s also important to be aware of the rules and regulations for shipping to China, as they tend to be on the stricter side. Also, consider what it will take to reach a Chinese audience successfully. If you’ll need to translate your website or marketing materials—or develop entirely new product lines to suit differing preferences—weigh that against the potential value of tapping into this market.
Shipping Internationally with Shippo
Shipping internationally can be challenging, but overcoming the hurdles and entering new markets worldwide might be the opportunity your business has been waiting for.
At Shippo, we’ve taken a number of steps to streamline the international shipping process, from enabling international order management within our existing Orders pages to expediting international label creation and customs forms filing. Our discounted shipping rates also make international shipping more cost-effective and affordable than you might expect.
To see the difference in action, sign up for a free Shippo account to get started. You can also reach out to our sales team with any specific questions on how to make international shipping as pain-free as possible for your business.