Declared Price

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What is the Declared Price?

The declared price is the price placed on a courier by the shipper. The value declared is calculated based on the goods’ cost and retail price. This is also the maximum amount the seller can claim under insurance if the shipment is lost. Additionally, it plays a major role in determining shipping costs.

Significance of Declared Price in E-commerce

In e-commerce, attaching a declared price to the shipment is important because transporting goods using commercial couriers can be risky. Here are some added benefits of declared price in e-commerce: 

  • Determines customs and shipment cost: The amount declared for a shipment determines the tax levied for the goods and amount charged by the courier for shipment. So, the seller has to ensure that the declared price mentioned on the imported shipment is correct. 
  • Prepares for transportation risk: The declared price is also the maximum value that the seller can recover in the event of a mishap and loss of the shipment. However, the declared value is not the same as shipping insurance. 

Prerequisites for Declared Price

Declared value is critical in e-commerce logistics as it contributes to gaining a better value for the shipment and also from customs. Here are the prerequisites of the declared value  

  • Shipping insurance

Along with the declared price, the shipper should also take shipping or cargo insurance to avoid financial loss in case of loss of shipment.  

  • Correct calculation 

Businesses should ensure the correct declared price is attached to the cargo. They should avoid false value declarations to avoid high shipping fees or customs fees at all costs. 

Use Case of Declared Price

For example, the shipper attaches a declared price of AUD 100,000 to a high-value item. But due to an accident during transportation, the courier gets damaged. The shipper can raise a claim based on the declared value of the damaged goods.

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