Here’s a look at the most important do’s and don’ts to help you navigate international shipping with the fewest possible delays.
If you’re thinking about breaking into the import and export markets, you’re in good company. Approximately 200,000 American businesses import goods from abroad—the majority of which are small- and medium-sized businesses. In 2017, United States imports increased 7.3 percent to $81.4 billion and exports increased 6 percent to $54.3 billion.
When you import across borders, you embark on a profitable but complex journey of coordination, regulation and compliance.
While the import and export industry in the U.S. represents a clear opportunity for businesses to expand and grow, it’s important to keep in mind that when you cross borders with your imported goods, you embark on a profitable but complex journey of coordination, regulation and compliance.
Will your shipment arrive intact and on time? Will it pass U.S. Customs or be flagged for inspection? How can you prevent the most common delays and penalties to make your import and export business as cost-effective as possible?
From customs clearance to customs forms, here’s a look at the most important do’s and don’ts to help you navigate international shipping with the fewest possible delays.
International shipping do’s
Include the correct documentation and make sure it’s clear. U.S. Customs and government agencies want to see a clearly identified country of origin, as well as accurate descriptions, quantities and values. Triple-check that both import and export documentation meet the required standards so you can avoid time-consuming delays and costly penalties. Customize your documentation by country, and, when in doubt, provide more detail than you think you need. That’s the safest way to make sure your imported goods are correctly itemized by one of the hundreds of classifications for products based on size, materials and intended use.
Specify the correct value and currency. One of the most common duty and tax disputes is Inaccurate Declared Value, and an error in value can cost you big in import delays and penalties. Enter the purchase price of the merchandise being shipped on a per unit basis or – even if you don’t plan to sell the contents – enter the value of similar/identical merchandise exported to the destination country around the same time as the shipment on a per unit basis in the currency in which transactions are made. You should also include in the declared value any money paid for selling commissions, assists, royalties, production costs, packing and proceeds, and these items should be noted on the commercial invoice. Then, make sure to keep the value consistent across all your other documentation.
Choose suppliers carefully. Price is always a consideration in business decisions, but the moment you need to make a quick change or request specific customs documentation is the worst possible time to realize that your bargain-priced provider may not be up to the task. Remember, you get what you pay for. Check with resources such as the UPS® Supplier Management Services group and UPS TradeAbility® tools to make sure you secure providers who offer the level of detail, information and support you need in order to overcome international shipping challenges such as different languages, time zones and carriers.
Pad your timeline and your budget. When importing into the U.S., keep in mind that Title 19, section 1467, of the United States Code (19 U.S.C. 1467) gives U.S. Customs and Border Protection the right to examine any shipment imported into the U.S. This can add a time delay, as your shipment will be moved to a Centralized Examination Station for the exam to take place, and you also must cover the cost of the examination. Factoring in this extra time plus including additional money in your budget can help accommodate these unforeseen delays.
International shipping don’ts
Don’t forget commercial invoices. Around the world, countries commonly require commercial invoices to detail what’s in a shipment and identify the correct classification, amongst other things. Printing and filling out a paper Commercial Invoice is an option for providing UPS with your commercial invoice information, but you can also opt to provide the commercial invoice information through an online shipment creation process. Please note that you may be required to produce the actual commercial invoice (the one between the supplier and the purchaser) at a later date. Ensure that you keep an original copy of that invoice in your records.
Don’t assume countries in close proximity have similar shipping policies. Every country has unique requirements, practices and restrictions for international shipping and determining which products and materials can be shipped into and out of the country. Don’t make the mistake of assuming that countries will have similar shipping policies (or holiday schedules) simply because they are located near each other or have overlapping primary imports and exports.
Don’t wait for problems to come up. When it comes to customs clearance, the old adage proves true: an ounce of prevention is worth a pound of cure. Not doing your due diligence can cost you. Customs penalties can be three times the value of the imported goods, plus unpaid duties. So, it’s in your best interest to prepare your paperwork as if you might be audited at any time.
International shipping of imported goods presents an enormous opportunity to develop your business into an international player. But without an experienced partner, you may find that international shipping holds more adversity than opportunity. Use this list of do’s and don’ts to plan your first international shipment, and consider working with an experienced import and export consultant like UPS to help you avoid import delays and save time, money and frustration.
Visit the UPS International Shipping help center for more tools and services to support your import and export business.
Note: This communication does not constitute legal advice. It is for informational purposes only.