by Michelle Mondonedo
Hidden fees to be aware of when shipping internationally
If you’ve ever shipped something internationally, you may have gotten some unpleasant surprises when receiving your monthly invoice from your courier: fuel surcharges, DDP handling fees, remote areas. No one likes being surprised with hidden fees or additional surcharges, so we’ve come up with this guide to help you get a better understanding of where these fees come from so you’ll know what to expect for future international shipments.
Express couriers vs postal couriers - what’s the difference?
First, let’s talk about the differences between express couriers (UPS, Aramex, SF Express, etc.) and postal couriers (such as HK Post, SingPost, and USPS.) With postal couriers, the pricing is simple – you will pay mostly for the shipping costs. However, the speed of their services are slow and the service quality is low. On the other end, express couriers provide fast and reliable services, but the pricing is much more complex and will depend on various factors.
Let’s break down the express courier costs into three main categories:
- Shipping-related charges
- Parcel handling-related charges
- Tax & duty-related charges
Shipping-related charges. These are related to the details of the shipment, such as the pickup location, the delivery destination, and the delivery hours.
- With express couriers, the main additional charge that you will face is the fuel surcharge. Calculated as a percentage of the shipping costs, this vary weekly or monthly depending on the country. Be mindful of their fluctuation as it can have a significant impact on your bills!
- If you read the fine print, you may be surprised that depending on the pickup location, you can face a surcharge. This is usually called a “remote area surcharge” or “extended area surcharge”, meaning these locations are far from the usual collection path of our dear couriers. If pickup is in a residential building, an additional surcharge may also apply for certain couriers!
- Optional value-added services can be chosen as well to take care of your shipments, such as an additional insurance (in case of lost or damaged shipment), delivery out of regular working hours (such as Sundays, public holidays or within a short time frame.) However, as these will be chosen by you, it’s unlikely you’d find this surprising.
- Finally, mistakes happen, and unfortunately you can be charged for this. Some of these fees include “address correction fee”, “delivery reattempt” or even “return fees”.
Parcel handling-related charges. This has to do with the items you want to ship, their container, the weight, and the dimensions. Couriers prefer standard and easy-to-handle parcels; if your parcel doesn’t fit their criteria, you can be hit with additional charges!
- Shipping “dangerous goods” has a price. You usually will be charged an additional fee, mostly as a percentage of the shipping costs or the value of the goods (sometimes even both!)
- If your parcel exceeds a courier’s standard dimension or weight, surcharges can apply. For example, if the length of your parcel exceeds 2 meters, or if the dead weight is over 80kg, you can be charged for having an oversized item or heavy parcel. (If you find yourself hitting courier weight and size restrictions often, perhaps you should consider sea freight.)
- The material and the shape of the containers can lead to additional fees. If your container is made of wood or metal, or if it’s cylindrical, you can expect extra fees to be charged.
Tax & duty-related charges. As you may know, shipping internationally means the sender or the recipient will have to pay for taxes and duties under certain conditions and the amount will vary depending on the destination.
- For DDU shipments (Deliver Duty Unpaid) the recipient is responsible for paying the taxes and the duties. In this case, you won’t see any additional charges from the courier. However, you need to remain alert, because as the sender you will be responsible for your shipment in case the recipient is not willing to pay those taxes or doesn’t want the shipment anymore. In that case, either you would have to pay for the recipient, or worse case scenario, ask for your shipment to be returned or abandoned. In both cases, someone will have to pay something.
- For DDP shipments (Deliver Duty Paid), you (the sender) will pay for the taxes and the duties. However, the pricing for this is more complex! The couriers will charge you an additional fee for paying those T&D on your behalf when the shipment arrives at the destination country. In addition to the fixed “DDP handling fee” for taking care of those taxes & duties, you can also expect a “disbursement fee”, calculated as a percentage of the amount of T&D they will advance on your behalf. These charges can appear subsequently and should not be underestimated. Despite the complex pricing, DDP shipments do bring you the peace of mind that your shipment will not be returned or abandoned simply because the recipient refuses to pay for the T&D.
- One mistake you should avoid entirely is under-declaring the items of your shipments on the commercial invoice. If the custom clearance agencies suspect that the declared value is below market price, they may ask you for a new invoice and many additional costs can follow. If they don’t receive the revised commercial invoice in a timely manner, the parcel can remain in customs, triggering warehouse storage fees. Additionally, the courier can charge you a fee for undervaluing your goods. So please be careful in assessing and declaring properly the value of your shipment! Here are some other tips on what to do if your shipment is stuck in customs.
Now that you are aware of the hidden fees and additional charges that can occur while shipping internationally, we hope you can learn to budget for these accordingly (or avoid some of them entirely.) Through Easyship, we guarantee tax & duty and list all potential surcharges in our shipping quotes so you will never be caught off-guard again. The price you see will be the all-in price (with the exception of mistakes or misdeclarations – we have no control over that!)
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