Every geography has its unique rules and regulations when it comes to shipping, logistics, fulfillment and last mile delivery - Southeast Asia is no different. With the right advice and experience, however, you can master the market, and deliver your packages on time and on budget.
1. Get acquainted with local laws
Southeast Asia is a complex area when it comes to trade laws and customs. Each country has its own specific set of rules and requirements, and before you start thinking about your shipping strategy you need to make sure that you’re fully prepared for each country you plan to do business in. Most countries, especially the ones with large markets like Malaysia and Indonesia, have requirements for certificates and licenses for international shipping. Here are some links for more detailed customs information on a few Southeast Asian countries:
Getting into trouble with customs as a business can get you a warning or a light fine, but it can result in much bigger consequences like being blacklisted.
If we ignore the trouble it could cause you directly, there’s also the trouble that it causes your customers. If the cross-border movement does not go smoothly, that almost always means delays for your customer. So not only can your company suffer directly, but it can also suffer indirectly through poor customer experience.
The risks of running into trouble are enough justification for being on top of things from day one. So, make sure that you have all the proper documentation and procedures in place so that you don’t run into any legal obstacles.
2. Label things properly
One of the easiest and most costly mistakes to make when shipping internationally is to get addresses wrong. Having the wrong address on your label can be a catastrophic error when it comes to your shipping process. Because your package crosses the border before it is handed to a local courier (who checks the local address), having an invalid address will result in the package being sent back to you, which means even more customs and transportation fees. Then, when you get the address right, you have to go through the whole thing again. You can see how something as simple as a label can have a huge impact on your profit margins.
And don’t forget about the customer! An international package being sent back right before it goes out on its last mile will result in a huge delay for your customer! If they are tracking their package, things can get even more confusing and frustrating for them, as they’ll see their package enter the country and then exit it again. You want to avoid these experiences at all costs.
Making sure that your labels are perfect can be an overwhelming task. After all, street names change all the time, and how are you supposed to keep track of all of that in all the countries you ship to? The best way to solve this problem is to either invest in automation software that will manage the printing of your labels and ensure it is geographically accurate; or partner with a logistics company that will take care of this for you.
3. Find the right packaging
International shipping means more steps, more kilometers, more time spent in shipping for each package. Packages that cross borders will go through much more than packages delivered locally, so you want to make sure that your packaging fits the trip. No one wants to receive a package that is damaged and unusable from inside the box.
Some customers are even picky enough that if the box is dented or damaged, they’ll feel displeased - even if what’s inside the box is completely intact! This is because the packaging is the customer’s first impression of your company. If the packaging looks terrible by the time they get their items, it won’t leave a very good impression of you on your customers.
You should also be aware of the volumetric weight of your packages. Volumetric weight is the amount of space a package would occupy, which is often more important during transportation than the normal weight of your package. The more space your package occupies, the more you’ll need to pay. Minimizing the size of your packaging is very important to avoid unnecessary fees.
You need to find the proper balance when it comes to your packaging. You want to make sure that your packaging is strong enough to withstand the wear and tear that comes with international shipping, but you don’t want to make things too bulky or ugly. Bulky packages will slow you down in warehouses and cost you more, and customers don’t like ugly packages. It’s a fine line to tread, but you want to have a package that is both aesthetically appealing, sturdy, and convenient to move around.
4. Choose shipping companies carefully
You’re going to need to partner up with shipping companies to move your packages across borders. Too often do companies just go for the best deal and pick the cheapest option, regardless of what service is being offered. They think that as long as the package reaches its destination, it’s probably okay. It’s best that you don’t cheap out in this specific area. Now, this doesn’t mean that you should go big and partner with the most expensive carrier either. You need to find the best carrier that offers you what you need, not the most expensive option.
If you lack expertise and knowledge about shipping companies outside of your country, then a safe bet is to go for established carriers. They typically are the most reliable, have the widest reach, and provide fast service. The upside is that they’re usually not the most expensive to work with, but they also typically aren’t the most experimental when it comes to technological innovation.
Trying to find the best shipping company to work with within each country in Southeast Asia can get tricky. Each market has its own quirks and specificities, and sometimes even the best research won’t be enough for you to make the right choice. One alternative to get around this problem is to partner with a logistics company that will already have local shipping partners they work with. The logistics company will bring the knowledge and experience that you lack and will make sure that they pick the right shipping company for what your business needs.
5. Weigh your items precisely
Very often companies will provide an estimation of the weight of their packages when sending them out to be shipped. This is usually fine for small-scale operations, but if you’re trying to scale up your business, this isn’t a viable option at large scales and long term. International packages will be re-weighed by local carriers so they can calculate shipping costs. If you provide them with an estimate, they will probably measure something different themselves. If the difference is large enough, they will usually charge additional fees.
The best way to address this issue is to invest in a precise scale and implement weighing the package before it is labeled and sent off.
6. Pick the right locations
Location is even more important when it comes to international shipping than to local shipping. Even though you are shipping internationally, you still want to provide the smoothest and fastest service possible to your customers, to maximize your customer retention.
A great place to start is to strategically pick the locations you ship from internationally. If you have a centralized shipping strategy, it’s important to choose a hub that has an established network of shipping lanes that makes international shipping streamlined. Luckily for us in Southeast Asia, Singapore has been the number one shipping centre for 7 years in a row, so there’s an easy choice that’s readily available to you.
7. Stay on top of extra fees
A lot of the tips we’ve given are related to avoiding extra costs, fines, fees, etc. This is because oftentimes these extra charges are completely unnecessary and can be avoided if you are paying attention and managing your packages properly.
There are, however, some additional costs that are just unavoidable. Long-distance charges, fuel surcharges, fragile shipping charges, fees on certain materials, storage fees - the list goes on. These charges also vary from country to country, just like the rules and regulations on imports do. Depending on what you’re shipping, where you’re shipping it to, and how you’re shipping it, you can have more or less extra fees. The point isn’t to minimize these fees because sometimes doing that will go against your entire shipping strategy. The point is to make sure you’re aware of the total cost of shipping an item and that you properly account for it in advance. Shipping is becoming more of a cost to be covered by the seller rather than the customer, so it’s important that you reliably evaluate how much shipping internationally will cost you.
Understanding these extra fees will also allow you to manage your international shipping policy. If you notice that shipping to remote locations internationally is too expensive, but you still want to ship internationally, you may choose to stick to large urban areas.
At the same time, if your bottom line isn’t what you expected it to be, you won’t be surprised by the amount of money you ended up spending on shipping. The last thing you want to do is look at your spendings and not understand how you spent so much on shipping. By staying on top of each country and each carrier’s fees, you’ll be able to craft a sophisticated shipping strategy.