I N T E R N AT I O N A L
SHIPPING
SPECIAL REPORT 36
brought to you by
brought to you by
International Shipping
1
CONTENTS
Introducing the International Opportunity 04
Connecting with Customers Worldwide 07
Considering Courier Marketplaces 10
Q&A with DHL’s Mohammad Khan 12
CASE STUDY: Sheridyn Swimwear 13
Solution Providers 14
FOREWORD & EXECUTIVE SUMMARY
Welcome to Power Retail’s Special Report on
While large retail businesses are able to corner new, international
International Shipping.
markets, even sole traders and independent merchants are maximising
both sales and revenue by selling offshore.
A new era of business has arrived. Not only
are new business models appearing while
This Special Report aims to provide an overview of how the barriers
traditional ones are seeking to evolve, so too is
to deliver internationally are now lower than ever, as well as how
the customer base – the entire retail footprint –
merchants might seek to make the most of this opportunity.
is changing dramatically as a result of the World Wide Web.
Campbell Phillips
Editor
Power Retail
PUBLISHER
SOLUTION SPONSOR
EVENT PARTNER
Power Retail is Australia’s news and
information resource for the online and
multichannel retail community. The medium
exists to help bridge the knowledge gap
between what is being done and what can be
done in e-commerce retailing.
DHL Global Mail is your specialist for postal
solutions - worldwide. We enable cross border
e-commerce by connecting online retailers
with their customers across the globe. Our
mail terminal in Australia dispatches more
than 4,200 parcels a day, reaching 520,000
deliveries every year. With our international
postal solutions, we are dedicated to making
our customers’ lives easier.
Online Retailer is a four-day blizzard of new
ideas, problem-solving solutions, career
networking, cost-saving resources and
quality learning. It’s the most comprehensive
curriculum on online and multichannel
retailing in the Asia Pacific, and it’s one of
the world’s largest e-commerce and digital
marketing events for retailers.
www.powerretail.net
www.dhl.com.au/mail
2 International Shipping
brought to you by
www.onlineretailer.net
FROM SHOPPING CART TO DOORSTEP
AND EVERYTHING IN-BETWEEN.
∙∙∙∙∙∙∙
We work with some of the web’s biggest retailers to deliver their products
to international customers in the most direct way possible. Our flexible
service covers everything from the design to deployment of fulfillment
systems, including pick-up, transit, customs, delivery and returns. So talk
to DHL Global Mail to change the way you ship, and do business.
www.dhl.com.au/mail
brought to you by
International Shipping
3
The World is Flat
WORDS: Campbell Phillips
The ubiquity of high-speed broadband is
bringing the world closer together, giving
retailers good reason to look beyond their
traditional, local markets.

S
ince the early days of the internet, consumers have been making
good on their sudden ability to directly access producers and
manufacturers from around the world.
Due to this massive, ongoing technological revolution, con-
The International Opportunity is
Growing
Here are some statistics from PayPal and Nielsen on cross-border
sumer purchasing patterns have been radically altered, tempting repeat
trad1:
customers away from the store and on to the web. There’s little wonder
nC
ross-border online shopping will be worth US$105 billion in
that many of our mainstream brands continue to feel threatened by these
2013, with 94 million consumers regularly buying from overseas
websites.
changes.
However, this isn’t some localised event. Yes, we’ve heard a lot about the
trials and tribulations of the local retail industry, but Australia and New
nB
y 2018, this will increase nearly 200% to US$307 billion with
130 million cross-border online shoppers.
Zealand are by no means alone when it comes to offshore purchases. In fact,
nT
op purchase categories for cross-border shoppers across the 6
Nielsen estimates that 94 million cross-border shoppers will spend US$105
markets are: clothes, shoes and accessories ($12.5 billion); health
billion online in 20131.
and beauty products ($7.6 billion); personal electronics ($6.0
At the time this prediction was made, PayPal President David Marcus
impressed the fact that these statistics shouldn’t come as a shock, as cross-
billion); computer hardware ($6.0 billion); jewellery, gems and
watches ($5.8 billion); and home electronics ($5.4 billion).
nT
op reasons for shopping online from overseas merchants are:
border trade has been engrained in civilisation for millennia.
“Cross-border trade is nothing new,” he said. “Our local stores are filled
“buying online to save money” (80%) and “more variety that
with goods from around the world. What is new is how easy it has become
cannot be found locally” (79%). Cross-border shoppers are not
for consumers to shop online directly from merchants around the world
just looking for an online discount, but also searching overseas
for high-quality, authentic items.
and the massive opportunity that represents.”
nS
afety and trust are key drivers with nine out of 10 shoppers
1 PayPal and Nielsen Report, Modern Spice Routes: The Cultural Impact of
Cross-Border Shopping, July 2013.
4 International Shipping
brought to you by
claiming buyer protection is critical.
Lorna Jane
From Bricks and Mortar to
Multichannel Supremacy
In 1990, Lorna Jane was a single retail store in the heart of
Brisbane’s CBD. Today, the retailer has grown to amass 120
outposts throughout Australia, three in South Africa and six in the
US, with 20 more stores to open by June 2013. Adding to the lineup is also an e-commerce operation that has grown to become a
substantial contributor to the overall business.
Lorna Jane’s digital strategist, Sam Zivot, explains that as a
traditional retailer, the greatest difficulty in the transition to
multichannel retail was technology.
“With traditional retail very much in our blood, developing our
internal IT capacities in order to tackle an e-commerce project of
this magnitude has been our greatest challenge,” Zivot says.
“It’s becoming more and more evident that significant
restructuring of the company is necessary in order to keep pace in
the digital era. A multichannel retailer can no longer just be a great
retail company – they need to be a great technology company too.”
Founder, Lorna Jane Clarkson pictured alongside the Marketing Team and Kieran Perkins
The Gaping Hole Between Proactive and Reactive
Many savvy business owners and decision makers have already realised the
“There will be no change to the GST,” a spokesperson for Treasurer Joe
Hockey announced in September 2013. “End of story.”
potential for their venture to flourish by facilitating cross-border purchases.
But that isn’t the end of the story. ‘Experts’ continue to extol the values
While we’ve seen a number of new arrivals appear on our doorstep – in some
of lowering the GST threshold, all the while many small retail businesses
cases even opening physical outlets in Australia – local businesses are also
continue to be hamstrung by a lack of digital knowledge, experience and
taking their offerings to the world.
(most importantly) confidence. The Myers and Harvey Normans of the
And they’re profiting as a result.
world have since invested significant amounts into playing catch up with
However, there seems to be just as many brands that have failed to take
their web strategies, while the small players without this level of resources
full advantage of the opportunity and we’ve seen a number of business leaders instead become fixated on market protectionism as a solution to their
problems.
are left to struggle on.
Research published by PayPal Australia shows that technology comprehension continues to be a significant challenge for local businesses, with three in
Since 2010, major Australian retailers have been publicly raising concerns
about offshore purchases and the threat that cross-border trade represents.
five Australian small-to-medium enterprises claiming low levels of digital
literacy is preventing them from running their business more efficiently2.
Leaders of companies like Myer, David Jones and Harvey Norman were par-
However, this statistic doesn’t necessarily represent the retail industry,
ticularly vocal about the “uneven playing field” that the internet represents,
with surveyed business owners coming from a range of sectors. In fact, there
admonishing the government for not lowering the threshold for which
is plenty of anecdotal evidence to show that many small Australian retail
imported goods can have GST applied.
brands are leading innovation in local e-commerce, and a number of these
At the same time, these very retailers were dragging their feet when it
came to e-commerce. Their websites were slow, didn’t display anything close
to their complete product ranges and usually charged customers for shipping even if an item was only being delivered from one suburb to the next.
What has occurred over the intervening three years is very telling.
The GST debate continues to rage to this day. On an almost weekly basis
a new story arrives about some retailer, retail advocate or pundit holding
up the disparity of the $1,000 import threshold as the greatest threat to our
are even targeting international markets as their offerings mature.
Australia’s Rose Garden: Exemplars Above the Rest
It doesn’t take very long at all to discover a local brand that has accelerated its
growth many times over by selling internationally. All of which are unique
offerings, excelling in customer service, product and technological prowess.
Included below are several snapshots of Australian ventures that have
made the international leap and are growing rapidly as a result.
local industry. Has the government done anything about it? Perhaps some
2PayPal Australia Report, Digital Literacy Among Small Businesses in Australia,
were hopeful a change of government would mean a change of legislation in
October 2013.
this area. It hasn’t happened.
brought to you by
International Shipping
5
OzSale
Rapidly Introducing Flash Sales to
Asia-Pacific
As one of the first businesses to hit the ground with the flash
sales online model, OzSale has been well-placed to capitalise from
disruptive e-commerce practices.
And capitalise it has. Founded by brothers Carl and Jamie
Jackson, the business continues to dominate the local flash sales
market, while also ramping up activity in New Zealand and even
into South-East Asian territories. Part of the company’s success
also stems from the early adoption and innate comprehension of
the mobile platform, which has since grown to become the major
source of OzSale’s revenue.
“Our growth strategy has essentially been to replicate the model
in our target developing markets,” says CEO Carl Jackson. “We
began by testing the water in Singapore three and a half years ago
and we’ve been trading well since then. Since then we’ve set up in
Thailand, Malaysia, The Philippines, Korea and Hong Kong.”
Carl Jackson, CEO and Co-founder of OzSale.
TinyMe
Tiny Name, Large Reach
A popular pureplay retailer of customisable products for kids,
TinyMe realised early on that Australia represented only a tiny
portion of its potential market. With a unique product and strong
brand character, this venture has since developed well beyond its
initial mandate as a local start-up retailer.
In July 2011, TinyMe was launched in the UK, which set in wheels
the motion for further expansion. In June 2012, the company unveiled
a US-specific website. As Co-founder Mike Wilson explains, by
partnering up with local distribution operations, the company can
take full advantage of local delivery options to execute the ‘last mile’.
“In both the US and UK we have third party logistics partners,”
Wilson says. “We currently do twice weekly bulk express shipments
straight to these partners, who deconsolidate the shipment and
put our parcels into the local system. In the UK, the majority of
parcels are delivered internally via First Class Royal Mail and get
to 90 percent of customers the next day. In the USA, we have used
a full track-and-trace service with a mix of US postal and other
TinyMe’s Co-founders: Nick McLennan, Mike Wilson and Ben Hare
internal carriers.”
In the end, not every retail venture will be suited or capable of sustainably
The remainder of this Special Report will provide insights and overviews
shipping internationally, and the methods by which this initiative can be
into these various concerns, as well as the technological and partnership
approached are many and varied.
opportunities that are available to achieve an international solution. n
Some businesses will prefer to expand their physical store footprint and
supply lines to keep pace with their expansion, thus slowing the process
down. Others may fare better by running a lean drop shipping operation, or
delivering directly over long distances. Ultimately the decision will rely on
careful analysis of available fulfilment options, as well as holistic integration
of the relevant strategies and processes into the business.
brought to you by
International Shipping
6
Connecting With
Customers Worldwide
WORDS: Anica Zich, Product and Marketing Manager, DHL Global Mail (Australia)


F
or many online retailers shipping internationally and understanding all of the associated rules and regulations can be
daunting. However, global cross-border online shopping will
be worth $105 billion this year, with 94 million consumers
regularly buying from overseas websites. By 2018, it is expected to grow
nearly 200 percent to $307 billion, with 130 million cross-border online
shoppers.1 In other words, even considering all the associated risks, this
may be an exciting business opportunity and a huge incentive to make
the next move and expand overseas.
So how to start selling internationally? The first thing to consider is
whether your products are ready to be sold overseas or if they need any
modification, new labeling or adjustments to meet the laws of your
targeted markets. Each country has specific regulations and some goods
might have restrictions or be prohibited. Research your target markets to
make sure you know who your customers are and what they expect. For
your pricing strategy, remember that the amount you charge your local
customers for your products will not be the same for your international
customers, as different overseas market conditions, costs and currencies
will affect your price. International consumers prefer to see pricing in
their currency so you need to provide a conversion tool or pricing in local
currency. A secure payment system to facilitate the acceptance of electronic
payment for international online transactions is also important, considering that if consumers do not trust your website, they will not buy your
products. Lastly, tailoring your site to suit the audience you are targeting
may be a good idea to leverage your international sales. To give an example,
offering language options will create the right look and feel and make any
consumers feel welcome and comfortable when purchasing from you.
7 International Shipping
brought to you by

Leveraging international
demand can add muchneeded revenue to any
retail business. Today,
offshore markets are more
accessible for businesses of
any size or type.
Targeting new markets
Researching international markets is critical in order to expand your
online business and make sound decisions. The good news for Australian
online retailers is that the annual international online spending for Australian products and services is expected to grow from $5 billion in 2013
to $16 billion in 2018.1 Understanding the potential markets will help
you to grab a piece of this growing opportunity.
If you are looking to test a new market you just need to look across the
Tasman. Thanks to similar consumer preferences and no language barriers, New Zealand is a great option to start selling to. According to the
Australian and New Zealand online shopping market and digital insights
report by PWC, Australians and New Zealanders look for the same categories and 93 percent of Kiwis shopping online purchased goods from
international websites between 2011 and 2012.
Goods and Services Purchased During the Last 12 Months
*Source: PWC Report, Australian and New Zealand online shopping market and digital insights, July 2012.
The USA represents the second biggest export market and, just like
In general, shipping companies base their rates in zone guides, group-
New Zealand, has similarities with Australia. But when we talk about cus-
ing countries according to the distance. For small parcels, rates might be
tomer expectations they differ greatly as the US market is more mature
fixed up to 2 kg increasing every 500 gr or 1 kg suiting businesses sending
and familiar with online shopping than Australia.
items with similar profiles, which means you can easily estimate your
average shipping costs. Also, a per item and per kilogram rate will be
Market Comparison
applied by some shipping companies, which is a better option if you are
Online Shopping Expenditure as Percentage of Total Retail
Sales (Domestic and International) compared to 2012
sending heavy and light items so you pay for the exact weight of the item.
Other costs you may incur are fuel surcharge which is usually adjusted
monthly, insurance of the items and extra features. Changes in fuel prices
have resulted in increased overall costs for the transport industry, necessitating a variable fuel surcharge which may rise, fall or be removed, in line
with movements in fuel prices. For valuable products you can also protect
your packages against loss or damage during transit with insurance cover.
Some other features, such as tracking and proof of delivery, are possibly
charged depending on the delivery provider.
*Source: PWC Report, Australian and New Zealand online shopping market
and digital insights, July 2012.
See below an example on how to calculate the final
cost of the product including duties and taxes:
Invoice Value
$80
Insurance Paid
$8
Freight Paid
$12
Total Value
$100
Duty Rate* = 7%
x .07
$11 billion by 2018.1
Duty Charge
$7.00
International Shipping Costs
Total Value+Duty Value
$107.00
VAT*= 18%
x .18
VAT Tax Charge
$19.26
Total Value+Duty+VAT
$126.26
It is expected that about 34 million US shoppers will spend $2 billion
with Australian online retailers, doubling to $4 billion in 2018. Thus,
USA is a sizeable market for Australian online retailers.
In Asia, China will be another interesting market to look into, since 39
percent of Chinese cross-border shoppers will buy from Australian websites this year, spending over $2 billion this year and increasing to nearly
Once you have defined your target markets and products it is time to start
thinking about shipping costs. Costs vary according to the destination
country, the timeframe your goods need to be delivered in and also the
weight and volume of the items.
1-Source: Paypal Report, Modern Spice Routes: The Cultural Impact and
Economic Opportunity of Cross-Border Shopping, July 2013
brought to you by
*Sample duty and tax rates for the benefit of this calculation. Exact duty and
tax rates will depend on the destination country.
International Shipping
8

Checklist for cross-border fulfilment
n Research respective country restrictions and prohibitions
n Make sure you know your customers and target markets
n Make sure you offer secure payment methods in your website
n Define your exporting price considering currency, delivery charges and customs duties
and taxes
n Always specify delivery timeframes and return policy to your customers
n Complete all the shipping documentation required by your 3PL provider before sending
the goods
n If you are sending goods from Australia valued $2,000 or more an Export Declaration
Number provided by the Australian Government is required. Your 3PL provider can
arrange this for you.
n A
lways enclose the commercial invoice as this is used by Customs for duties and tax purposes
n W
henever possible use valid Harmonised Tariff Codes (HS). This allows the destination country customs office to evaluate your goods
and ensure the goods are being taxed appropriately.
n M
ake sure the packaging of goods is secure and solid. Keep in mind your goods may be handled up to 15 times during transport.
The sturdier the packaging the better!
Duties and Taxes
Customs thresholds
It is important to consider the impact of customs duties, taxes and other
Every country has a different customs threshold. If the total value of your
government charges when determining your shipment’s total shipping
shipment is under the threshold, duties and taxes may not be applicable.
costs. This obviously influences the final price the consumer is willing to
Please note that although taxes may not apply due to customs threshold,
pay for your products as well as the overall shopping experience.
duties may still apply depending on the type of product imported. The
But what are the duties and taxes? The import duty is a tax that the
importer has to pay to bring foreign goods into a country and the Import
VAT (Value Added Tax) or GST (Goods and Services Tax (GST) is a tax
charged on imported goods and services. Duties and taxes are imposed by
the government to generate revenue and protect local industries against
foreign competition.
Duties and taxes are calculated as a percentage of the value of the imported goods, including freight and insurance of the products. They are
affected by:
n T
rade agreements
n C
ountry of manufacture of the goods
n T
he product’s Harmonised Tariff Code (HS Codes)
best way to find out what the threshold for a particular country is or what
other customs regulations apply is to speak to your logistics provider.
Examples of different Customs Thresholds
DESTINATION
COUNTRY
THRESHOLD IN LOCAL
CURRENCY
THRESHOLD IN AUD
(AS OF OCT 2013)
Australia
AUD 1000
AUD 1000
Malaysia
MYR 500
AUD 165
USA
USD 200
AUD 207
Thailand
THB 1000
AUD 33
*Harmonised System code is an internationally standardised system of
names and numbers for classifying traded product. Duties and taxes rates are
estimated and will charged according to the destination country
In order to provide a good online shopping experience
it all comes down to delivery
Who is responsible for the payment?
How long the product takes to be delivered is a crucial part of the cus-
If the consumers are surprised by high customs fees they may refuse to
tomer experience and can become a deal breaker for online retailers.
pay for the duties and taxes and refuse to accept the items. So when send-
According to the IMRG Report,^ UK Consumer Home Delivery Review
ing goods overseas you need to think about who is paying for the duties
2013, 74 percent of consumers said that a good delivery experience would
and taxes, which means that you have to choose between DDU and DDP
encourage them to shop again with a specific retailer.
shipments.
The delivery is your touch point with the customer and most of the
What is DDU and DDP?
customers’ expectations are based on your delivery service. If the product
n D
DU means Delivered Duty Unpaid.
does not arrive within the correct timeframe and in good condition or if
n D
DP means Delivered Duty Paid.
the customers do not receive the item, the customer is very unlikely to
Under DDU terms all duties and taxes of the importing country have
come back to your online store and even worse, spread negative word of
to be paid by the end recipient. In other words, the consumer has to pay
mouth about your company. Therefore, working with a reliable logistics
additional charges when the shipment reaches the country on top of the
partner who understands your business and growth requirements is the
advertised price on the website. For a DDP shipment, the online retailer
key for your international business success. n
takes care of all expenses including the duties and/or taxes in order to
deliver the products. In this case the selling price of the products includes
^IMRG is a UK based industry association for online retail; focused on best
practice for ecommerce, mcommerce, social media.
all duties and taxes to reach the goods at the door step of the consumer.
brought to you by
International Shipping
9
Considering Courier
Marketplaces for Achieving
‘Best Practice’ Fulfilment
WORDS: Campbell Phillips
The fulfilment
landscape has become
as increasingly more
complicated as the
world of B2B and B2C
delivery has become more
globalised. This trend is
giving rise to specialist
aggregation platforms
and courier marketplaces
that are the ideal solution
for online retailers.
C
onsumers want to make purchases and receive purchases via
Are the shipping providers happy with that? According to Hartmann,
numerous avenues, and this is beginning to turn into a true
the ones who understand the power of an ecosystem are. While many car-
expectation rather than a passing fad. As a result, retailers can
riers are now being forced to offer more competitive rates than ever before,
no longer use one courier, or just Australia Post, for example.
if it means that retailers are accepting more orders online for delivery, that
In fact, in order to offer ‘best practice’ fulfilment, including same-day,
results in more business for the carrier. It’s this kind of uplift right across
next-day and international deliveries, many retailers will be considering
partnerships with at least two national carriers, a hyper-local courier
(WantItNow is an example) and a couple of international providers.
“Before you know it, you might have six providers to manage, and that’s
why systems like ours are rising in popularity,” Carl Hartmann, CEO of
Temando says. “As that fragmentation increases and the shared cost of
individually integrating each provider become prohibitive, the need for a
smart system that can handle all of those business rules becomes greater.”
Without such a system, retailers simply wouldn’t be able to co-ordinate
and optimise fulfilment across a range of providers without building
a complex platform from the ground up. Even better, by offering best
practice fulfilment, retailers can look to reduce shipping costs and actually
increase sales volumes.
10 International Shipping
brought to you by
the board that Temando is striving to generate.
“We’ve become a system that tries to match consumer expectations with
merchant capabilities and what the shipping provider is actually able to
provide. That requires a single, easy-to-use system that can manage the
entire process.”
Maintaining Competitive Advantage with Fast Fulfilment,
Anywhere
But it isn’t just a variety of delivery options domestically that retailers
should consider as best practice for generating wealth via fulfilment.
While it is a major component, a best practice retailer should also seriously
consider international shipping.
Hartmann explains that there’s one very simple reason for that.
to supplement your sales with international growth you can look to sub-
Temando’s Tips for Turning
Fulfilment into a Profit Centre:
stantially increase growth. The overall internet shopping population is
1. Ensure that your fulfilment strategy offers customers what
“The thing is, Australia really isn’t a very large market, so if you’re able
really quite gigantic, so it’s worth trying to develop an international offer.”
But how do you know if your product or brand is capable of being competitive both at home and away? Both local and global are - almost ironically - becoming increasingly important for Australian retail ventures. But
they want – If your customer base is mostly local, give them
fast, cheap local delivery. If you have a unique product that will
gain interest overseas, investigate international options.
2. Don’t feel obligated to work with only a few couriers or freight
services – By limiting yourself to one, two or even a handful
that doesn’t mean you can approach both in the same way.
Ultimately, it comes down to ensuring you are working with your fulfilment strategy to maximise your offering’s unique value propositions.
“For example, you might not have a unique product in your home
market, but if you can deliver it faster and more cheaply than other online
competitors, then you’ll capture sales,” Hartmann says. “Likewise when
of providers, you may be able to handle local, or even national
delivery cost-effectively, but you won’t be able to offer the best
fulfilment option on every level. Expanding your options will
make a significant difference to the rates you have access to.
3. Ascertain costs before taking an unnecessary hit – This
selling internationally, you need a unique product and delivery options
especially applies to international shipping. If you aren’t aware
that meet or exceed the expectations of the local marketing (and there are
of all the tax, duties and other additional charges that may
plenty of Australian sellers already achieving this).”
apply for shipping your wares, it will undoubtedly come back
When targeting an international market, one of the primary consider-
to haunt you. By using a holistic system like Temando, you
ations is driving awareness of your business in that market. If it’s a unique
can avoid the hours of research, trial and error that might
product you’re offering, there’s every chance it may be unheard of. The
otherwise go into offering customers a wide array of delivery
question becomes one of generating visibility fast and effectively.
options.
“There are a number of marketplaces to consider selling into, and they
can be a great way to improve your product’s and brand’s visibility in those
places. Apparel brands are a great option to consider selling internationally because they are generally selling their own product.”
“At the end of the day, I see the bigger issue here being price harmonisation and not GST. I don’t think it’s fair that Australian retailers sometimes
When crafting an offering for a local audience, there’s an obvious advantage for many merchants with physical locations: offering free shipping
have to purchase their stock at up to twice the price that other retailers
would buy it in other markets. I think it’s ludicrous.”
and free returns into stores. It’s for this reason that Temando have recently
But until these suppliers do begin to change their pricing strategy,
added multi-location functionality, click and collect, iPhone Passbook no-
Hartmann says Temando also has a solution that can help enable more
tifications and more in order to really help enable multichannel retailers
cross-border trade, and especially enable drop shipping to Australia from
to take their fulfilment strategy to the next level.
overseas.
“The added benefit here is that those merchants offering pickup and
“These variations between different tax laws and duties and so on actu-
returns to their stores will increase their likelihood of making additional
ally play in our favour,” he says. “We’ve implemented a system called the
sales as a result and eliminate one of the major perceived barriers to pur-
Harmonisation Engine, which essentially enables retailers to classify their
chasing goods online.”
products with unique Harmonised Shipping Codes, which we can then
Introducing Some Harmony to the GST Debate
Given Hartmann’s position within the e-commerce and retail industries,
he has a unique perspective on a number of trending issues, which is why
the GST couldn’t help be brought up during his recent interview with
determine what tax, duty or other attention a product might attract as its
crossing borders, yielding the retailer the true cost of delivery.” Additionally, it also screens for products restricted for import and export, and this
is opening up new opportunities for our merchants.
The Future of Fulfilment
Power Retail.
According to Hartmann, the GST is not the concern many of our larger,
“We’re very interested in the ‘Internet of Things’, and what we’re trying to
traditional retailers are making it out to be. Of more concern is the dispar-
create is a physical internet. If you can imagine all the points of the fulfil-
ity in international prices, which is largely controlled by suppliers and
ment journey as nodes, and each provider as a connection, then we’re try-
distributors.
ing to create an ecosystem where everyone is provided for. By doing this,
“Compare just about any item that you might buy in the US versus what
we can increase transactions, which means more conversions and activity
you pay here and the Aussie dollar’s value and GST aren’t nearly enough to
for everyone in that ecosystem. Couriers get more work, merchants get
justify the gap.”
more sales, the industry grows and everyone’s happy.” n
brought to you by
International Shipping
11
Q&A
with
Mohammad Khan
Business Development Manager, DHL Global Mail
M
ohammad Khan’s 23 years
of professional experience is
varied; from the Australian
domestic market to imple-
menting international solutions, especially
in the Asia Pacific region. Mohammad Khan
specialises in B2C cross-border distribution
solutions. Mohammad has worked on various
B2C projects in Korea, Japan, Singapore, New
Zealand, Hong Kong and Europe.
Mohammad worked for Australia Post in
their international division, responsible for
strategic customers and market development
and then moved to UNSW (University of New
South Wales) Global managing key clients.
In 2012 he joined DHL Global Mail and has
helped a number of online retailers, ranging
from SME’s to major players in the market,
W
hat constraints are there for retailers
to sell internationally?
Apart from the delivery costs and high
Australian dollar, there are specific country
restrictions and prohibitions that retailers
need to comply with. Not knowing enough
about international trade can become a
barrier. There are differences in language,
culture, business, political, and legal systems.
Therefore, conducting extensive market
research is important. The lack of market
research can hamper any well-intended effort
in being successful in the global market place.
A
re there specific business models that
lend themselves towards international
sales?
W
hat technological/infrastructure
concerns are there for businesses
seeking to implement an international
expansion strategy?
I would say that in today’s e-commerce world,
which operates 24/7, businesses need to rely on
the latest technology available in the market
as consumers are not only tech savvy but the
e-commerce world is extremely competitive.
Most companies use various types of software
which enables businesses to automate every
single step from website maintenance to order
taking, acceptance of payments, fulfilment of
orders and tracking of particular orders.
Also, logistics partners do provide despatch
management systems where businesses can
upload data files and produce delivery labels.
Another important factor is warehousing
to find solutions to minimise cost, enhance
Having a successful domestic strategy tends to
and distribution. Businesses need to consider
service capabilities and increase customer
encourage e-commerce retailers to look into the
warehousing location, pick and pack costs,
satisfaction.
international arena. Looking outside of their
delivery options and customer service.
W
domestic market is a natural progression to the
hat does the current shipping
global market place. In order to be successful
landscape look like? Are many
internationally you will need to consider the
H
ow does DHL work with its clients
to assist in the execution of such
businesses shipping product overseas or is
following:
strategies? How are you unique from other
there a larger prevalence towards imports?
n D
evelop a global and open mindset –
providers?
There is a big market for exports from
Australia, but we are talking about niche
products and Australian made products, i.e.
swimwear, Ugg boots, health nutrients and
natural cosmetics.
Drop shipping of orders is the latest
shipping trend. This is a method of delivery
whereby e-commerce retailers sell products
online and, upon receiving payments from
sales, consolidate the orders and send them
to an overseas supplier for fulfilment. The
overseas supplier will then send the shipments
directly to Australian consumers.
increase global awareness, network and
DHL provides expert advice to its clients
skills, and challenge your assumptions
and works with them to develop customised
n H
ave a business plan – develop a well-
researched export plan
n H
ave a financial plan – detail the investments
client is the same, clients have specific
requirements for different markets. We work
you need, how you are going to finance them
with our customers to provide end-to-end
and the returns on your investment
supply chain solutions from warehousing,
n D
etermine your target customers and keep
your focus on them
n T
est, learn from mistakes and launch
refined offers. Do not be afraid to try
different selling approaches
n C
onsult with your logistics and delivery
partner to discuss which cost-effective
delivery solutions are most appropriate.
12 International Shipping
solutions because we know that not every
brought to you by
freight forwarding, express/time sensitive
deliveries and standard deliveries to
consumers in around 220 countries and
territories.
case
study
~ Sheridyn
Swimwear ~
THE FACTS
Challenge
Solution
Sheridyn Swimwear’s founder came across the
With their warehouse located in Australia,
In 2012, Sheridyn Swimwear started using
opportunity to partner with the professional
Sherydin Swimwear needed a reliable logistics
DHL Global Mail’s global network to ship their
Australian model Sheridyn Fisher to develop
partner to help them manage their products
international orders. All shipments are sent
a new swimwear line in 2009. Together
flow from Australia to customers worldwide.
to the destination country and then injected
they created the brand Sheridyn Swimwear,
launching the official website in 2010.
Mohammad Khan, Business Development
into the local postal network in the most cost
Manager from DHL Global Mail met the
effective way. Plus, with the tracking service
Sheridyn Swimwear founder during the PESA
they know exactly where the items are, which
their products on their own Australian-based
conference in May 2012. “Sheridyn Swimwear
enables them to manage their customers’
site, SheridynSwim.com.au for the domestic
was unhappy with their current logistics
expectations regarding the delivery.
market only. After 2 years of succesfully selling
partner at that time. Most importantly, their
the products domestically, they decided to go
3PL provider could not offer a regular mail
through their multi channels can be uploaded
overseas, selling across multiple channels such
service with tracking, resulting in a few losses.
into DHL’s web portal. The system generates
as eBay and Amazon to customers worldwide.
The customer always wants to know where
the shipping labels and provides tracking
With Sheridyn Fisher’s intense social media
their purchased product is and when they will
information to the end recipients.
activities on Instagram and Facebook, soon
receive it, thus offering tracking information
they became the #1 selling swimwear store on
is crucial for customer satisfaction,” says
Outcomes
Mohammad.
The increased efficiency and cost-savings are
At first, Sheridyn Swimwear was selling
ebay.com.au.
Sheridyn Swimwear discovered that the US
Sheridyn Swimwear was looking for the
Besides, all international orders generated
the most notable outcomes. With DHL Global
and Europe are interesting markets for the
following criteria in order to satisfy their
Mail’s help, Sheridyn Swimwear is growing
popular Australian swimsuits. “Our products
customers’ expectations:
their business overseas: “We started with just
were subject to seasonality in Australia, since
n A reliable logistics partner
a few international orders per week. Today,
people do not buy swimsuits during winter.
n A cost effective solution
our international and domestic sales are
By exporting to new markets we found a way
n Tracking service
equivalent”, says Sheridyn Swimwear’s founder.
to overcome this issue and maintain our sales
n Good and consistent transit times
“The customer service and account
volume throughout the year,” says Sheridyn
management offered by DHL Global Mail is a
Swimwear’s founder.
key differentiation. Way better than the past
provider, DHL really values the relationship
with the customer. We are definitely planning
to maintain our partnership for the future.”
brought to you by
International Shipping
13
solution
providers
DHL Global Mail is your specialist for postal solutions - worldwide. We
enable cross border e-commerce by connecting online retailers with their
customers across the globe. Our mail terminal in Australia dispatches
more than 4,200 parcels a day, reaching 520,000 international deliveries
every year. With our international postal solutions, we are dedicated to
making our customers’ lives easier.
We are part of the Deutsche Post DHL group, the world’s leading mail
and logistics services group. With a global network and connections to
more than 220 destinations, you can count on us for local expertise while
entrusting us with your international business.
We provide e-commerce retailers with the most cost effective
way to ship their B2C parcels worldwide. You can either make use of
our convenient standardized product portfolio or have us develop a
customized solution specifically for your needs. Enter new markets and
take advantage of our comprehensive services and solutions to simplify
your e-commerce business.
We aim to be “The Logistics Company for the World”, simplifying
customers’ lives and contributing positively to the world.
Contact:
W: www.dhl.com.au/mail
T: +61 2 9669 9000
E: [email protected]
14 International Shipping
brought to you by