International Fulfillment: Ultimate Guide to Finding the Best Method
Katie-Jay aims to put answers in the hands of small business owners by leveraging over 10 years of retail and hospitality experience. With a background in gemology, she specializes in jewelry and luxury ecommerce.
Agatha Aviso is a writer of the Reviews Section at Fit Small Business, focusing on order fulfillment and eCommerce platforms. Agatha has a decade’s worth of experience writing online content for small businesses and marketing industries. She also served as a content strategist and digital marketing manager for many entrepreneurs.
This article is part of a larger series on Retail Management.
Global ecommerce sales are set to more than double pre-pandemic levels by 2025, proving that borderless ecommerce is a profitable option for online retailers. There is no better time to offer international fulfillment for your customers.
Ecommerce sellers can offer global fulfillment for their international customers in two ways: cross-border international shipping and localized fulfillment. The differences between the two are storage location and fulfillment operations.
We generally recommend:
- Cross-border international shipping: Best for small businesses shipping internationally—startups and growing ecommerce businesses that ship a small percentage of orders globally and those testing international markets
- Localized fulfillment: Best for established ecommerce businesses with consistent international customer bases and well-established markets
In cross-border international fulfillment, goods are stored and fulfilled in your country, then shipped per order to international customers. Meanwhile, in localized fulfillment, goods are shipped in bulk to be stored in a country or region near your international customers, then fulfilled per order from a local warehouse. This involves higher risk and more up-front spending.
Global Fulfillment Options at a Glance
Cross-border Fulfillment and Shipping | Localized Fulfillment | |||
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In-house | Third-party | Global Warehouse Network | Region-specific Fulfillment Partner | |
Best for |
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Storage location | Your home, office, warehouse, or ecommerce facility | Specialized fulfillment center(s) in your country | Multiple fulfillment centers in your country and abroad | Fulfillment center(s) in the country or region you serve |
Shipping costs | Market-rate cross-border shipping | Discounted cross-border rates | Discounted local rates | Discounted local rates |
Customs requirements | Documentation, duties, and taxes per order | Documentation, duties, and taxes per order |
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Delivery speed* | 1–4 weeks | 1–4 weeks | 2 days–2 weeks | 2–6 days |
Labor involved |
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Recommended solution | Rate comparison and order management software Try | Domestic fulfillment provider Try | International fulfillment provider Try | Region-specific fulfillment partner Try WarehousingAndFulfillment.com to find the right provider |
*Delivery speed varies greatly by location, carrier, and shipping method.
International Fulfillment Using Cross-border Shipping
Cross-border fulfillment involves shipping orders from one country across borders to buyers in other countries. Cross-border shipping is the easiest and quickest way for most small-scale sellers to start shipping internationally as it lets you manage inventory and fulfillment via your usual process. The main changes involve the needed documents to ship and the carrier options you’ll have.
Here are two ways you can cost-effectively work international orders into your business using cross-border shipping:
In-house international fulfillment has the lowest barrier to entry and allows your shipping strategy to be modified at any time. It usually costs more in the long run than outsourcing to a third-party provider, but in-house cross-border shipping is best for those developing their own in-house fulfillment operation or just testing the waters with international sales.
If you decide to go this route, start by learning about the best international shipping carriers and methods that serve the countries you’re selling to.
FedEx, UPS, USPS, and DHL are popular choices with a global reach. Each company has a convenient calculator tool to determine costs, options, and transit times. See our guide to FedEx vs UPS vs USPS.
Consider these factors when choosing your carrier(s):
- Shipping speed
- Affordability
- Quality of service
- Insurance options
- Tracking capabilities
- Returns management
Some best practices to keep in mind when doing in-house cross-border shipping:
- Make sure to check country- or territory-specific regulations that may affect your international shipments. These restrictions largely affect hazardous or dangerous goods, but some locales restrict broader categories as well. For example, used clothing cannot be shipped to Saudi Arabia from outside countries.
We suggest using UPS’ Import/Export Regulation tool, which provides area-specific information on product stipulations, necessary invoice requirements, documentation, exemptions, and weight/size/value limits.
- International shipments may require different packaging than domestic orders, mainly due to parcels going through many additional facilities and spending more time in transit. If your goods are susceptible to damage, include more dunnage or use sturdier boxes/mailers for international orders. To accommodate the cost of this, consider adding a handling fee to global orders.
For the most part, your usual order processing, picking, and packing method can stay the same when performing international shipping in-house—but your shipping label procedure will change, since you need to create customs forms. (Customs, which we will cover in more detail later, is an agency responsible for collecting fees and controlling the flow of goods into and out of a country.)
The simplicity of this task depends on the shipping software you use. Some programs print international customs forms and auto-populate customs fields for you, as shown in ShippingEasy’s Customs Information screen below.
If your shipping software supports customs forms, you can print the necessary documents from your usual system. If not—or if your shipping strategy doesn’t include the use of shipping software—you can use your carriers’ websites to get the job done, but adding this extra step breaks up the usual shipping workflow and requires more time to complete the task.
We recommend ShippingEasy to streamline shipping processes and save on time as well as transport rates. You can learn more about the software in our ShippingEasy review.
With cross-border fulfillment, your inventory is stored in your country, and a third-party logistics (3PL) provider handles the ins and outs of international shipping.
Similarly to the in-house method, each international order crosses borders and goes through customs, which entails applicable delivery duties and taxes. For most small-scale sellers shipping a small, consistent percentage of sales abroad, third-party cross-border fulfillment is the easiest and most cost-effective way to handle international fulfillment.
Read our in-depth guide to third-party fulfillment companies and how they work.
Most US-based fulfillment providers offer international shipping, but be sure to confirm this service and clarify the details before partnering with a 3PL.
Here are some of the top options for US-based fulfillment companies that offer robust international shipping services:
- ShipBob: Our top recommendation for small business fulfillment with more than 20 US warehouse locations that can ship internationally. As global business scales, retailers can opt to store portions of their inventory in any of ShipBob’s seven international warehouse locations.
- Red Stag Fulfillment: Best at handling large, oversized, heavy, or fragile products—and optimizing these tricky shipping scenarios to be as safe and cost-effective as possible. The company’s two US warehouses can accommodate international orders.
- FedEx Fulfillment: The logistics company’s well-entrenched global transportation network makes FedEx Fulfillment a qualified choice for maximizing shipping potential. The company’s warehousing and distribution services are effective and reasonably priced for small businesses processing 400+ orders per month.
Combine Multiple Fulfillment Companies
Some fulfillment partners have international shipping built into their offerings, while others exclusively ship to the country in which they’re based.
If your existing fulfillment partner doesn’t offer international shipping, you can choose an additional 3PL to handle the international portion of your sales without needing to break your contract and migrate all of your inventory to a new provider.
You can manage this type of fulfillment in two ways:
- Route international orders from your primary partner to your cross-border partner, which then handles customs and ships the goods to the customer.
- Pro: This is the most hands-off way to manage this combination of fulfillment companies as this can be easily automated through the companies’ fulfillment platforms.
- Cons: It will likely add a couple of extra days to the order’s delivery date. And, you’ll be paying double fulfillment costs for each international shipment.
- Partner with a 3PL capable of shipping internationally and store a portion of your inventory in its warehouse.
- Pro: This option speeds up the process because all international orders are routed directly to this secondary company, which fulfills them from the stock already available.
- Con: You’ll still face increased fulfillment costs.
If you’re an Amazon seller, expanding internationally is simple—just make your existing product listings available globally from the settings in your domestic Amazon account.
To fulfill international Amazon orders, choose from any of the options outlined in this article, or consider outsourcing fulfillment and shipping to Fulfillment by Amazon (FBA), which includes FBA Export for international sales at no extra charge to the merchant.
The hurdles of cross-border shipping individual orders may be draining if a sizable percentage of your sales come from abroad. Consider localized fulfillment to simplify the process and save on shipping and duty costs.
International Fulfillment Using Localized Fulfillment
Localized fulfillment involves stocking a portion of your inventory in warehouses within the countries or regions you’re shipping to. These goods are fulfilled and shipped to your international customers by a third-party company.
Localized fulfillment works in much the same way as domestic third-party order fulfillment: You send inventory to your localized fulfillment partner, which stores it, and then processes, packs, and ships your orders to customers. The only difference is that your local fulfillment partner is based in your destination country.
Localized international fulfillment is a highly cost-effective way to handle international orders within specific global regions since most orders don’t have to go through cross-border customs or be subject to certain import taxes. It also reduces shipping costs and increases delivery speed.
Here are two ways to do localized international fulfillment:
Some US-based fulfillment providers boast an international warehouse network in addition to stateside locations. This allows clients to strategically distribute inventory throughout the globe—keeping shipping costs, time in transit, and duties low.
Using a global warehouse network is the best choice for most small businesses as it provides the convenience and cost-effectiveness of standard outsourced logistics and allows for maximally efficient, seamless international shipping.
Outsourcing fulfillment and shipping to a global 3PL also gives you the flexibility to redistribute inventory as demand increases in certain areas.
Here are some of the options that small business owners have for outsourcing global fulfillment:
Fulfillment Company | Warehouse Locations |
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Using a region-specific fulfillment partner is best for retailers nurturing strong customer bases in targeted locations. If you are a retailer with consistent sales in specific regions or countries, you can choose to partner with a fulfillment company based in those locations.
A portion of your inventory is stored on-location, and orders are shipped to your international customers without crossing borders. The rest of your stock is kept in your country for domestic sales. This method can be combined with US-based third-party fulfillment or in-house shipping for domestic orders.
For additional international orders coming from locations outside of these targeted regions, shipping can be approached in multiple ways:
- Cross-border ship certain parcels, depending on the distance between origin and destination countries
- Fulfill other international orders in-house
- Have them shipped by your domestic third-party fulfillment provider
To find a region-specific fulfillment service, try searching for fulfillment companies in the countries you frequently serve and reach out for an individualized quote.
Brokerage services like WarehousingAndFulfillment.com can do the searching for you by matching your shipping and fulfillment needs with hundreds of prescreened fulfillment partners. When using a fulfillment broker, the third-party companies pay for matchmaking service—so there’s no extra cost on your end.
Global Fulfillment & Ecommerce Customs
Before embarking on your international shipping strategy, consider one of the main differences between domestic and cross-border shipping: customs.
Imported parcels have to go through the customs process, which applies to international ecommerce orders in the same way it does to all other shipments. To make sure your shipments arrive without delay, unnecessary cost, or legal penalty, you’ll need to be prepared for customs.
Basically, you need to deal with fees and documents when it comes to ecommerce customs.
When you ship goods to another country, you (or the customer) may be asked to pay duties and taxes before the shipment is delivered.
Did You Know?
Not every shipment is taxed on import. If your shipment doesn’t exceed the destination country’s De Minimis Value—which is the minimum value required to apply customs duty and tax rates on imported goods—you’ll be exempt from most customs fees. Check with each country’s government website to find current De Minimis Value thresholds.
The purpose of these charges is for local governments to protect domestic companies from foreign competitors, control the flow of certain products, and raise additional revenue.
Here’s an overview of the fees you may encounter when selling internationally:
Duties are a type of tax charged on goods moving into or out of a country. These fees are separate from sales taxes and vary depending on your shipment’s country of origin and destination. They can include:
- Import duties, which are charged by the government of the destination country. This fee is assessed as a percentage of the shipment’s value, freight costs, insurance, and any additional costs.
- Export duties, which are charged by the government of the country in which the cross-border shipment originates. Many countries, including the US, do not charge export taxes.
- Tariffs, which are charged by the destination country to restrict the import of certain categories of goods that can be produced domestically.
- Anti-dumping duties, which are charged by the destination country. These fees are imposed on imports priced below the fair market value of similar goods in the domestic market.
Taxes are government fees charged on purchased goods. They are assessed as a percentage of the goods’ value and vary by country.
You may need to register for tax identification depending on where your international sales take place (along with your sales turnover). Check with the country’s government site for detailed information.
Some governments apply different tax rates to different categories of goods. The types of sales taxes you may encounter include:
- VAT, or Value Added Tax, is applied at every step of the supply chain. It accounts for an added percentage of the goods’ intrinsic value.
- GST, or Goods and Services Tax, is a flat-rate percentage of a transaction’s value.
Documents
Making it through the customs process requires additional forms and documentation not used in domestic sales.
These requirements vary by destination, but most countries ask for:
- Commercial Invoice: This document is simply the bill for the shipped product from the seller to the buyer. It verifies ownership, contents, and accurate value. This is prepared by the exporter (i.e., your ecommerce business) and is necessary to be cleared through customs.
- Certificate of Origin: This is a document declaring where the products you’re shipping were manufactured. It is obtained from your local chamber of commerce.
- Packing List: A document that details the contents of your shipment, including a description of goods, weights, dimensions, and how the parcel is packed.
Check with your shipping carrier for exact information on the documentation you’ll need for your shipments.
Bottom Line
Expanding internationally is a powerful way to grow your ecommerce business. Shipping international orders is the trickiest part of global expansion due to customs requirements, shipping costs, delivery speed, and labor.
It’s possible to successfully incorporate the task into your fulfillment workflow by creating a well-developed shipping strategy. But, for retailers making a significant portion of their sales from international customers, outsourced fulfillment is the best way to send orders abroad.
ShipBob has a global network of 24 fulfillment centers—including seven warehouses in popular international markets. This makes it simple to achieve localized fulfillment by distributing inventory near to your domestic and international customers.
