All you need to know about cross-border shipping!
Cross-border logistics is an integral aspect of global supply chain management. It helps businesses to expand their customer base and reach different countries across the world. As per recent research, cross-border trade represents 20% of global e-commerce and is growing at a 2x rate than domestic e-commerce.
Optimizing cross-border shipping is essential for businesses that aim to go global. Manufacturing of a single product requires raw material or parts that might be sourced from multiple countries. Effective implementation of cross border shipping can help businesses, streamline manufacturing and enhance customer satisfaction, resulting in improved business profitability and growth.
Though cross-border shipping offers plenty of benefits for businesses, it has its own set of challenges such as following exhaustive custom processes, lengthy paperwork, handling language barriers, compliance challenges and so on.
Considering these challenges, businesses must invest in strategic planning for cross-border shipping. With a thoughtful approach, businesses can overcome these common challenges and lead their organisation on the path of growth and success.
Why is integration of air and sea freight essential for cross-border shipping?
Sea and air freight are the two most important modes of transportation for businesses to facilitate smooth cross-border shipping. Air freight is well-known for its speed and is a great option for transporting time-sensitive goods. As a downside, it is the most expensive option. While sea freight is good for transporting bulky and heavier items, it is the most cost-effective option. However, it is slow and possesses an increased risk of delay or losing shipping goods.
Thus, businesses integrate multi-modal transportation for cross-border shipping as it helps with delivering goods on time, reducing costs and improving overall supply chain efficiency.
What are the best practices for optimizing cross-border shipping?
Perform a thorough research to understand custom regulations and local culture of related countries
Cross-border shipping involves the shipping of goods across countries. Each county has their own set of rules and regulations regarding customs clearance and other local procedures. Thus, it is important to perform thorough research to understand this beforehand. Be aware of the list of items which are permitted, and which ones are prohibited. Researching this aspect will reduce the complexity of cross-border shipping.
Maintain accurate and complete documentation
International shipping involves a myriad of documentation, including customs forms, bills of lading, business invoices, Import and export permits and more. Maintaining accurate and complete documentation is essential to prevent customs delays and ensure compliance with regulations. Make a list of required documents and prepare them beforehand to avoid the end-of-the-moment rush and experience stress-free shipment.
Proper packaging and labelling of products
Proper packaging and labelling of products are another crucial aspect of cross-border shipping. Choose appropriate packaging material, keep the package dimensions and weight as per carrier guidelines and mention specifically if you are shipping a hazardous or fragile material. Proper labelling helps with easy inspection and facilitates smoother custom clearance.
Invest in TMS (Transportation management system)
Investing in technology is a must for efficient cross-border shipping. Invest in a TMS system. A good quality TMS provides better visibility for your product. It offers important updates that help in real-time tracking of shipments. This enables businesses to monitor progress, identify potential issues, and make informed decisions to mitigate disruptions.
Follow the custom clearance process diligently
Custom clearance is one of the essential aspects of cross-border shipping. Keep yourself updated with any change in the custom process and prepare in advance for smooth execution.
Cross-border logistics is often associated with various risk factors such as delays in product delivery due to bad weather conditions, custom-related issues, political issues, infrastructure issues and so on.
Thus, having a comprehensive risk management strategy is essential for businesses to mitigate these risks. Effective risk management includes contingency plans, insurance coverage, alternative routes/modes planning and having access to backup suppliers.
Collaboration with Freight Forwarders
Partnering with experienced freight forwarders is crucial. They possess expertise in navigating customs regulations, documentation, contingency planning and transportation nuances, ensuring a smooth transition and a successful cross-border shipping for businesses. Freight forwarders who possess domain knowledge of the said industry are of additional value as they are familiar with the business requirements and the country specific supply chain requirements and hence can plan better for any contingency or disruption that may arise.
Cross-border shipping seems like a complex operation; however, with the right experts and good standard operating procedures in place, businesses can enhance their supply chain performance and gain a competitive edge in the global market. Hope the above post offered you a framework to create those dependable strategies and practices that will take your business to the next level.