Muley Freak is all about hunting accessories and apparel. Located in Ogden, Utah, Muley Freak embodies the western hunting aesthetic. They had been using a different shipping solution, but after seeing what kind of rates and service they’d receive, they thought it might be worth a try.
How Muley Freak Partnered with eHub
Prior to implementing eHub, they thought they were receiving the best rates possible and that their manual fulfillment was just how things were. After an eHub shipping specialist reached out to them, they started a conversation about some strategies Muley Freak might be interested in.
They found that they could get a much better deal with eHub after asking for a cost-analysis. One of the main things that made them switch from ShipStation to eHub was eHub’s team implementing business rules for them, which would make the entire shipping process seamless and efficient for them. After switching to eHub, they’ve been able to ship out more orders more quickly thanks to business rule automation.
Since implementing eHub’s software, Muley Freak has seen significant cost savings, lower overhead, and better customer service results while maintaining the quality that their customers appreciate.
Some of the main challenges we faced were getting the lowest rates possible and getting better customer service when we had an issue.
Aaron van Woerkom
Operations Manager at Muley Freak
Top Favorite Aspects of eHub
Rate savings of 21% per label
Streamlined fulfillment process for quick turnaround
Efficient, easy customization
Thanks to Amazon Prime and other large retailers, 75% of consumers expect free delivery on e-commerce orders, even for orders less than $50. When you contrast that statistic with the fact that non-Amazon US retailers sell over $82.5 billion internationally, it’s easy to see the challenges and the opportunities facing small businesses considering going international. So, let’s answer the question: Why is international shipping expensive?
Why is international shipping so expensive?
The expense of international shipping often scares small business owners, but that’s because they don’t know the intelligent shipper savings tips that can save them money and make the expansion they’ve dreamed of possible.
Formulating international shipping rates is complicated, but there are five areas where you can cut costs: package dimensions, fuel surcharges, minimum package charges, value-added services/accessorials, and customs.
Package dimensions
Shipping companies use the square footage and weight capacity (or similar metric) of their transport vehicles in their rate calculations, which means larger, heavier boxes cost more than smaller, lighter ones.
Smart shipper savings tip: Small businesses looking to expand into international markets can reduce their initial costs by selecting a few products with similar dimensions that can be packed in standard boxes. This will allow you to buy your packaging in bulk and accurately forecast your international shipping costs.
Fuel surcharges
You pay fuel surcharges for domestic and international (aka cross-border) shipping, but since international shipping involves longer distances with sometimes dramatic differences in fuel prices between countries, international fuel surcharges are substantially higher.
Fuel surcharges are the average, not the actual, fuel cost your carrier pays to deliver your products. Your carrier agreement likely has terms setting a base fuel rate and a base fuel mileage as part of its terms. When the fuel price exceeds your agreed-upon base fuel rate, the surcharge kicks in.
Small business savings tip: Fuel surcharges aren’t set in stone, and they don’t have to be a mystery. A reputable carrier will be upfront about how they calculate their fuel surcharge. It’s also often possible to negotiate a lower fuel surcharge with your carrier(s).
Formulating international shipping rates is complicated, but there are five areas where you can cut costs
Minimum package charges
One of the primary methods carriers use to protect their profits is minimum package charges, meaning the lowest price a carrier will accept to deliver a package. If you aren’t careful, this fee can cost you a lot of money.
Say your minimum package charge is $7, and your carrier service agreement has a 50% discount on packages shipped to London. You have a package that would typically cost $10 to send across the pond, which, with your discount, should cost $5. But that minimum package charge means you’ll pay $7, and the 50% discount you had budgeted for is now only a 30% discount.
The same thing goes if you are sending a tiny package of earrings to a shop in Notting Hill. Instead of paying the $4.25 it actually costs, that sneaky $7 minimum will cost you an additional $2.75.
Smart shipper savings tip: Like fuel surcharges, minimum package charges can be negotiated. Start tracking how many of your shipments are affected by the minimum package clause in your agreement. If you’re regularly paying more than you should or not getting the total discount in your contract, ask to renegotiate your minimum package charge.
Value-added services & accessorial fees
Many of the features consumers take for granted are actually value-added services (VAS) or accessorial fees that you, as the shipper, have to pay for. Examples of these fees include:
COD
Delivery confirmation
Return services
Declared value
Residential delivery/pickup (yes, you can be charged more for having customers in residential neighborhoods)
Special-handling (documentation, hazardous materials certifications, medical equipment, etc.)
Delivery issues (liftgate delivery, unsafe delivery locations, or improper equipment for shipment receipt)
Non-delivery due to business closure, no recipient present, or security delays
Small business savings tip: Small businesses, especially e-commerce businesses, ship internationally are much more likely to be adversely affected by these fees. As with minimum package charges, data is your friend when negotiating these fees (which you can do).
First things first, you need to keep track of which charges show up the most often, which accessorials are the most expensive, and what packages/locations are most likely to trigger those charges. Then, examine your operations. Can you pack your products in smaller boxes? Can you use more than one carrier? Can you verify addresses before releasing packages for shipment?
After you’ve lowered your expenses as much as possible on your end, you can negotiate which fees you are assessed and how much you are charged with your carrier.
Customs/duties/taxes
This is one area you have to budget for. Customs and duties are taxes charged at both ends (export/import) of international shipping, and you can’t avoid them.
Small business savings tip: An international e-commerce shipping software can help you build an accurate estimate of what your customs costs will be so you aren’t ever surprised.
Level up with international shipping solutions for your business
If you want to save money on your international shipping, optimize your packaging, understand your carrier agreement, and negotiate your fees. Click here to find out more about how eHub’s e-commerce shipping software can help you do all of that and more so you can capitalize on opportunities for international trade.
About Sewing Parts Online:
Sewing Parts Online is located in Dickson, Tennessee, and has been in business since 2008, fulfilling over 1 million orders since then. A quality sewing machine can last for decades with the proper care and parts, which is where Sewing Parts Online excels. They sell a variety of parts and accessories for the top global sewing brands.
How Sewing Parts Online Partnered with eHub
Sewing Parts Online were using an order management software that had switched to eHub’s API for rate shopping and shipping. After they upgraded their software system, one of the perks of the upgrade was an integration with eHub. The switch went as expected, instantly providing savings to Sewing Parts Online.
With our Order Management Software using eHub, it’s all pretty seamless and it’s a lot quicker to get a package out the door.
eHub’s API had a seamless integration with Sewing Parts Online order manager- offering a 20% time savings on top of the 20-30% shipping savings. This allows them to improve their customer experience, resulting in fulfilling more sales quickly, more scalability, and a greater bottom line as they fulfill the next million orders.
Top Favorite Functions
20% daily time savings for the warehouse team
20-30% savings on each label
Direct contact with customer support staff for easy integration
About Vuori:
Headquartered in Encinitas, California, Vuori designs and sells clothing inspired by the SoCal lifestyle, mixing athletic performance with sustainable style. They have an engaged community with retail shops throughout the US, as well as a distribution center shipping thousands of packages a day. Their popularity has only grown as more and more people try their products.
Challenges Vuori Faced
As their business thrived, their fulfillment process needed to keep pace. How could they keep shipping costs down? Could they speed up the way they were fulfilling orders? They were utilizing a legacy warehousing management system paired with file drops. Whatever solution they chose would not only need to save them money on their shipping costs, but it would also need to integrate with their current WMS.
How Vuori Partnered with eHub
In order to properly integrate Vuori’s inhouse software with eHub’s API, the eHub team developed a custom integration for Vuori’s systems. We did it at no additional charge, it’s all a part of our process. This integration gave them access to more shipping products and service levels they didn’t have before, as well as allowed them to implement business rules to streamline the shipping process with predetermined weights and sizes. The eHub team took feedback from the Vuori team about what they needed, and our team used that information to create a competitive shipping program.
The shipping specialists at eHub provided a strategy to shift over 44,000 shipments to a different service level that was not only cheaper, but didn’t compromise on speed of delivery either. eHub also provided reporting and end of day scans to track shipments.
The shipping strategy resulted in savings on over 61% of Vuori’s shipments,with nearly $1 million of savings annually. Not only that, but the whole distribution center saved 2 hours a day, creating a more efficient workflow that gained further savings on overhead and employment costs.
Top Favorite Functions:
Nearly $1 million saved annually
Direct access to developers to streamline integration
Fulfillment time savings daily
Suppose it seems like UPS peak season surcharges are not only higher but lasting longer, too; you’re right. Since March 2020, UPS has had to adapt to the significant changes in e-commerce and the global supply chain. In a nutshell, people were buying more online… a lot more. Thanks to this increased demand, most shipping carriers had to adapt, UPS included.
One adaptation included changes to peak season surcharges. Typically, peak season is just around the 4th quarter, the busiest time of the year for retail. Since the logistics industry hasn’t quite recovered from 2020 (have any of us?), we’re seeing peak season stretch beyond 4th quarter.
It’s already here. Not only that, we’re seeing it split into what resembles a tier system. If you thought surcharges were expensive, well, I have some not-great news for you.
Peak Season Surcharges: Tier 1
July 4 — October 2, 2021 Fees: The following applies to all US domestic, import, and export shipments, qualifying customers who have shipped >1,000 total packages or more than ten that required Additional Handling during any week following February 2020.
Additional handling charges increased from $3.00 per package to $3.50
Large Package peak surcharge increased from $31.45 to $40.00
Peak Season Surcharges: Tier 2
October 2, 2021 — January 15, 2022 Fees: The following applies to all US domestic, import, and export shipments, qualifying customers who have shipped >1,000 total packages or more than ten packages that required Additional Handling during any week following February 2020.
Additional Handling peak surcharge increases from $3.50 to $6.00 per package
Large Package peak surcharge increased from $40.00 to $60.00 per package
The following will apply to all US domestic, import, and export shipments.
The Over Maximum Limits peak surcharge will be $250.00 per package
Handle your shipping costs and communication to customers accordingly, and have a plan for when things go sideways
Bonus Round of Surcharges for High-Volume Shippers
October 31, 2021 — January 15, 2022 Volume-Based Fee: The following applies to certain UPS Air Residential, UPS Ground Residential, and UPS SurePost, who have shipped more than 25,000 packages during any week following February 2020.
October 31, 2021 – January 15, 2022
UPS SurePost
110% to 200% of February 2020 volume
$1.15 per package
> 200% to 300% of February 2020 volume
$2.15 per package
> 300% to 400% of February 2020 volume
$3.15 per package
> 400% to 500% of February 2020 volume
$4.15 per package
> 500% of February 2020 volume
$5.15 per package
UPS Ground Residential
110% to 200% of February 2020 volume
$1.15 per package
> 200% to 300% of February 2020 volume
$2.15 per package
> 300% to 400% of February 2020 volume
$3.15 per package
> 400% to 500% of February 2020 volume
$4.15 per package
> 500% of February 2020 volume
$5.15 per package
UPS Next Day Air Residential
110% to 200% of February 2020 volume
$2.15 per package
> 200% to 300% of February 2020 volume
$3.15 per package
> 300% to 400% of February 2020 volume
$4.15 per package
> 400% to 500% of February 2020 volume
$5.15 per package
> 500% of February 2020 volume
$6.15 per package
All Other UPS Air Residential
110% to 200% of February 2020 volume
$2.15 per package
> 200% to 300% of February 2020 volume
$3.15 per package
> 300% to 400% of February 2020 volume
$4.15 per package
> 400% to 500% of February 2020 volume
$5.15 per package
> 500% of February 2020 volume
$6.15 per package
Current Service Levels With UPS Service Guarantee:
The following applies to certain UPS Air Residential, UPS Ground Residential, and UPS SurePost, who have shipped more than 25,000 packages during any week following February 2020.
UPS Next Day Air
UPS Next Day Air Saver
UPS Next Day Air Early
Domestic Express Plus
Domestic Express
Domestic Midday
Domestic Express Saver
UPS Worldwide Express Plus
UPS Worldwide Express
UPS Worldwide Express NA1
UPS Worldwide Express Saver
UPS Worldwide Express Freight Midday
UPS Worldwide Express Freight
Transborder Express
Transborder Express Plus
Transborder Express Saver
How Does This Affect Your Peak Season?
I think the most important thing to remember is that the peak season results in a lot more shipments, which can mean increased waiting times for customers, delays, and maybe increased charges. Handle your shipping costs and communication to customers accordingly, and have a plan for when things go sideways.
It could also be worth taking a look to make sure you’re getting the best rates on your business shipping. Our shipping specialists can perform an analysis that tells you where you’re already shipping most efficiently and exactly where you could be saving more. Contact us to get started on a custom analysis for your business.
About Yankee Thunder:
A New and Growing Business
Home of the Hang ‘n Hook Target Stand, Yankee Thunder sells steel shooting targets that are affordable and easy-to-assemble, as well as other “gear for men who love God, guns… and a good laugh.”
This small family-owned business began in 2018 operating out of their garages, bugging their wives with noxious fumes. In 2020, they transitioned into a full-fledged business, Q2 Tactical / Yankee Thunder, with a manufacturing facility harbored in Layton, Utah.
A budding company, Yankee Thunder now ships between 100 and 200 orders per day across the country to their tens of thousands of customers.
And demand is still growing, thanks to their funny tell-it-like-it-is branding and DIY-setup videos.
Challenges Yankee Thunder Faced
Yankee Thunder sought to do their research on ways to make their business more efficient from the very beginning.
They wanted something that could streamline their online sales and shipping processes from the get-go so they could hit the ground running. Managing fulfillment and keeping costs down was important so they could maximize their output, shipping costs, and bottom line since demand for their easy-to-make steel targets was already picking up.
After researching a few different solutions, Yankee Thunder chose eHub to streamline their business for e-commerce and shipping, and they haven’t looked back.
We see the saving on a daily basis – and we noticed it right away.
How Yankee Thunder Partnered with eHub
Ever since Yankee Thunder implemented eHub’s shipping software in May 2020,
They estimate that they’ve saved more than $30,000 per year in shipping costs.
“We see the savings on a daily basis–and we noticed it right away,” Brayden says. “We have been able to work with the eHub team to reduce our costs, not only on shipping but the shipping supplies we request.”
“We don’t have to calculate anything in our head!” Plus, the option of keeping the prices displayed throughout the process on the eHub platform has been helpful to “catch errors as we go,” Brayden says.
As a new company implementing a new service, Brayden was highly complimentary of the customer service team at eHub, stating, “We worked really closely with the eHub team to ask questions, to get training for new hires, and to make sure we were familiar with it as we implemented it into the company.”
“Honestly, it’s super user-friendly and easy to navigate,” Brayden says, calling himself to go- to guru on eHub’s software at work. “I enjoy using the system!”
Top Favorite Functions:
Ability to prioritize shipments based on options
Preset filters to batch orders
Inventory management that calculates weights and quantities automatically
With eHub we’ve been very happy – our contacts have been great to work with! Our advice? Go with eHub!
About Vox Fulfillment:
Reliable Ecommerce Distribution
Headquartered in Provo, Utah, Vox Fulfillment is a 3PL (also known as a third-party logistics provider). They manage the warehousing, distribution, and fulfillment for a variety of businesses ranging from small solopreneur businesses to Fortune 500 companies. They ship all over the world, fulfilling orders that include around 7500 packages a day.
The financial impact is literally hundreds of thousands of dollars.
Challenges Vox Faced
With such a high volume, they needed a high level of service paired with the ability to rate shop to find the lowest shipping rates for their packages. They also needed a solution that could integrate with their WMS, TMS, and IMS for domestic and international shipments.
They were using a combination of their own software in partnership with Stamps.com, but were curious if there was a way to integrate their software with something more cost-effective. Since their business revolves around logistics and fulfillment, keeping costs low is a priority. The companies they partner with have come to expect a certain level of service and efficiency, so keeping shipping rates low helps them to continue to offer that same great service without having to raise costs.
We use a homegrown software for WMS, IMS, and TMS, but we were looking for a better carrier mix to bring down our shipping cost.
Top Favorite Functions:
Hundreds of thousands of dollars in savings
Direct access to developers to streamline integration
Customer support knowledge and response
How Vox Partnered with eHub
In order to properly integrate Vox’s inhouse software with eHub’s API, the EHub team developed a custom integration free of charge as part of our services.
Our team did a direct API connection to eHub which gave access to additional carriers and discounted shipping rates.
Once the API implementation was completed, the Vox team started seeing savings immediately.
“We save on nearly every package we send.” Collins added.
Since May of 2020, when Vox originally signed up with eHub, their savings are over $700k and counting.
In part one of this two-part blog series, we reviewed some basics of the major carriers available for international e-commerce shipping needs. From USPS to several others, you have a few options for international shipping – and which you choose will depend on a few different variables.
At eHub, we’re happy to offer international shipping e-commerce solutions as just one piece of our comprehensive shipping API services. From helping you navigate paperwork and customs documentation to negotiating non-US shipping deals, managing returns, and more, we’re here to help with every area of international commerce for our clients. While much of part one of our series evaluated your options for international shipping, today’s part two will dig into the factors you should consider while selecting your carrier.
Landed Cost
Within the shipping world, the term “landed cost” is commonly used to describe the final, all-in-one price. It includes not only shipping costs but also duties, taxes, and fees, plus potential add-ons like insurance.
Before any customer completes an international purchase of your products, you should lay out their landed cost. In many cases, this information will include details on who is responsible for any additional fees that might be present.
Full Details
In addition to the landed cost of standard shipping needs, you must know what’s included in a shipping carrier’s program. For instance, does the carrier include insurance for all orders, for only orders with a specific minimum price, or not? If it’s not offered at all, you may have to offer some of your own. Also, inquire about areas like whether there’s a charge for proof of delivery, how tracking will work, and more.
Customs Forms
While customs forms will be pretty similar or even identical between carriers, they’re essential to think about. This is actually an area where working with our team of shipping professionals is just as important as finding a great carrier – we’ll help you with things like value per unit, international currency, harmonized tariff codes, and others, though we require a partnership with a robust carrier in several of these areas.
Trade Regulations
Another area where it’s essential to have both a suitable carrier and the expertise of pros like ours is within trade regulations, which vary between countries you may be shipping to or from. For instance, Austria does not allow the shipment of any alcoholic beverages or medicine, among other things; China doesn’t allow the import of toy guns. Knowledge of these regulations is vital for limiting overhead and maintaining your company’s reputation.
For eCommerce businesses that ship internationally and domestically, shipping factors and variables are a bit different. However, modern technology and improvements have created a situation where numerous companies have the resources to ship internationally with ease, not only significant corporations – this used to be the case in past generations.
Introduction
At eHub, we’re happy to help with a wide range of international shipping needs and challenges, from helping you choose the ideal carrier to filling out the correct paperwork, managing international returns, and many other areas. That first area, choosing a carrier, is often a bit more complex for international shipping than for domestic – this two-part blog series will go over several factors you should be considering, which our team will be happy to help you with during any international shipping process.
Major Carriers
Generally speaking, there are four significant companies or carriers that ship internationally:
USPS: You may not have thought of the US Postal Service as an international shipper because it’s an agency of the US government, but it is an independent government organization that offers four international shipping options. These range from Global Express Guarantee, which allows packages to arrive in one to three business days, down to First-Class International, where the number of days will vary by destination. USPS offers robust tracking and flat-rate shipping.
UPS: UPS also offers international shipping, and with higher packaging limits than USPS – packages can be up to 150 pounds compared to just 70 for USPS. Of course, more oversized items will come with higher charges. UPS also offers several shipping options and prices.
FedEx: FedEx ships to over 200 countries, with packages arriving between one and seven days, depending on service. Their max weight is similar to UPS.
DHL: Finally, DHL is more unique here. Its max parcel is just 44 pounds, much lower than the other options, and the service covers fewer countries. However, there are situations where going this route is the right move.
International First
One crucial tip for companies who perform both domestic and international shipping: When finding a new carrier, ask about international shipping variables first. As noted above, the significant carriers vary widely in their international shipping guidelines, pricing, and more – there isn’t as much difference between them when you get to domestic shipping areas, so your primary focus should be on the area with more variability.
When finding a new carrier, ask about international shipping variables first
Certain carriers might limit regions or countries they will ship to, which could be a big issue for your business. If you’re unsure about a given carrier, you may consider only shipping internationally to a few countries first to see if the program works for you.
Wrapping Things Up
For more on choosing an international shipping carrier or to learn about our eCommerce shipping services, speak to the staff at eHub today.
Why Ship Internationally?
You’ve seen the stats, like this one from CIEDEC—that 95% of the world’s consumer market awaits you outside US borders. And, after reading our tips for international sales growth, you’ve laid the groundwork to expand your international business shipping horizons. Now, it’s time to get up to speed with international shipping.
Though it may seem daunting, follow these steps, and your products will soar—literally.
1. What Can I Ship, and Where Can I Ship It?
First, review the Commerce Control List (CCL) to verify whether your product is allowed for export or if it is a controlled commodity that requires an export license. Also, depending on where and to whom you are shipping, you’ll want to check whether the government has sanctions or embargoes and prohibitions on end users or the product’s end-use. Then, check the Country Commercial Guides to determine whether your product is allowed for import in a particular country.
The good news is most commercial products do not require an export license and are designated EAR99 in the Export Administration Regulations, but before exporting, you will still need to ascertain your product’s Harmonized System classification and Schedule B number to complete the export and import forms.
An easy way to start offering international shipping to Canada and Mexico first and branch out from there. Trading with our neighbors has been simplified with the US-Mexico-Canada Agreement (USMCA) which allows qualifying small package shipments valued at less than $150CAD (in Canada) and $117USD (in Mexico) to ship duty-free, and the taxes have also been simplified.
Or, select from the 20 countries with a free trade agreement with the US. If the customs regulations of the country you are shipping to are rather complicated, and you plan to ship there frequently, you may want to hire a customs broker to help you cut through their red tape.
33Countries with Free Trade Agreements with the United States
Australia
Bahrain
Canada
Chile
Colombia
Costa Rica
Dominican Republic
El Salvador
Guatemala
Honduras
Israel
Jordan
Korea
Mexico
Morocco
Nicaragua
Oman
Panama
Peru
Singapore
2. Decide Who Should Pay For What
Incoterms define the rules of the ownership transfer… for instance, During the delivery process, when does ownership transfer; who is responsible for covering the licensing, customs fees, and taxes; and who, if applicable, is insuring the product for loss and damages? What’s the de minimus value for the country you’re shipping to?
As you consider handling these expenses, you should also estimate what your landed cost (or total expenses from the point of sale to the final receipt of the product) will be—there are many online calculators available to help you. Does it make sense for you to offer free shipping? Split the costs? Will you accept returns, and if so, who covers that cost? Should you adjust your product pricing to reflect the additional cost and work?
An easy way to start offering international shipping to Canada and Mexico first and branch out from there
Selecting which carrier to use is a big part of this step. Price is often the primary concern, but speed and convenience of delivery are factors as well. While USPS can often be the least expensive, its tracking capabilities and delivery responsibilities end once the product leaves its jurisdiction. Many private carriers handle delivery from door to door and offer more services, but those costs will fit into your overall price.
3. Sell Your Product(s) and Get Them On Their Way
Yay! You’ve cut through the red tape, done your research, and it’s paying off—the cash register is ringing.
Now, it’s time to generate a detailed Commercial Invoice (or Pro Forma Invoice for samples) outlining the terms of both the sale and the delivery, then finalize the required export and import forms (which you will have already determined through your research). Some of these can be completed online.
Then, package your product in a sturdy container that meets the standards of your selected carrier; create and affix your international shipping label, carefully proofing your recipient’s address and contact information; and attach your Commercial Invoice along with any other necessary customs paperwork.
Finally…
Transfer the package to your carrier of choice
Cover your contractual portion of the delivery costs
Receive a tracking number to provide to your buyer
After you pat yourself on the back, get back to selling!
Easy as 1-2-3.
Research 2. Analyze 3. Ship
Right? Okay, maybe we’re oversimplifying it. But, once you perform the cost-benefit analysis and create the foundation, the process will become systematic and, ultimately, well worth it.
Final Thoughts
However, if you find you do not have the capacity for it. eHub can help. We’ve done our due diligence in the export arena, developed relationships and pricing contracts with multiple carriers, and built the databases to support a seamless e-commerce API that will facilitate every international sale you make. To explore whether our international shipping solution could work for you, click here.