Many e-tailers fear the enormous expense of sending goods to the UK. Seven Senders and MS Direct show how retailers can continue to profit from the attractive market despite Brexit.
Huge traffic jams at the borders and lots of hassle with the paperwork: Since the UK finally left the EU at the end of 2020, many companies and also consumers have been unsettled. Experts anticipate further bottlenecks. Supply chains and companies that rely on international trade and cross-border processes are faced with numerous questions:
- Will they need their own logistics center in England?
- How can shipping, carrier and customs processes be designed with planning reliability?
Answers are provided by Felix Hasenzahl, Team Lead Sales at Seven Senders, and Peter Egger, Head of Sales Commerce, MS Direct AG.
Declaration requirement brings new challenges
The UK is one of the strongest e-commerce markets in Europe, with higher purchasing power than Germany. Online retailers who want to expand or continue to profit from this customer group therefore need a comprehensive strategy to position themselves well and minimize effort. Seven Senders and MS Direct would like to assist here with their sound experience, alleviate fears and simplify processes for retailers.
The border, which has been in force since January 1, 2021, and which affects the movement of people and goods to and from the UK, brings with it new rules here. The customs regulations themselves will not change, as customs clearance will remain based on the value of the goods. So-called low value goods, which cost less than 150 euros (around 135 pounds), are duty-free. What is new, however, is a declaration requirement for goods traded between the EU and the UK. "It is appropriate for online retailers to create a comprehensive and reliable database," Egger recommends.
"Our experience is that e-commerce in the UK is already a few years ahead of where we are. Customers' demands on the delivery experience are also higher. Six out of ten British retailers offer next-day deliveries, for example. Non-UK online stores have to keep up with that to be competitive."
Felix Hasenzahl, Teamlead Sales Germany
Paying attention to transparent, IT-supported data management
So what do these national peculiarities mean in the context of the new regulations? What should e-commerce experts and the like pay attention to? Clean master data and a comprehensive data strategy are essential for efficient logistics and customs processes. Therefore, companies should have all goods, shipping, carrier, billing or customer information that may be relevant well under control.
Support is provided by analysis systems that offer transparency and an overview of shipments. A granular view of individual items and goods is essential in order not to impede transport and border traffic processes and also to be able to return returns smoothly. A possible customs refund is also optimized and accelerated by strategic data management.
This is what you need for a smooth cross-border shipment:
You must have complete transit documents to cross the border. Customs duties and VAT, for example, are charged during this very bureaucratic process. Retailers need a VAT number and must apply for an EORI number. Completeness is enormously important in order not to lose valuable time during transport. Seven Senders and MS take care of this laborious task with their cross-border UK solution.
You need a legal representation in the UK, which is similar to the Swiss fiscal representation. MS Direct works with a broker who handles this for the store so they don't have to take care of it themselves. The merchants, in turn, work with MS Direct as a single point of contact.
Work with local carriers in the UK to customize last-mile delivery to meet your customers' needs. Here, it's a good idea to work with a partner that gives you access to a local carrier network. This is helpful as it streamlines processes, saves costs and better addresses national specifics. Seven Senders has the following leading carriers in its network: Hermes UK, Royal Mail, Parcelforce and Yodel. Seven Senders sends the parcels from the warehouse directly to the carrier in the UK, which again saves time.
Collective customs clearance makes sense for efficiency reasons. Here, the sender, i.e. the respective store, pays the customs duties so that the costs do not lie with the end customer. MS Direct requires information such as value of goods, net weight, countries of origin, German and British goods tariff numbers, and item descriptions in German and English. This data is then prepared for customs clearance and sent to the broker, who takes care of the rest. A separation of low value goods and goods to be cleared through customs is possible.
It is also advisable to work with a local carrier for returns, as they have a good network of drop-off points to enable customers to return goods easily. Seven Senders works with the nationally renowned carrier Royal Mail in the UK. At the same time, you should bundle returns with the local carrier and collect them back to the EU. This can save you expensive transaction costs. MS Direct and Seven Senders take care of returns bundling, customs clearance and transport. They store the goods in the UK interim warehouse, then send them to Europe. This is also where the parcels are sorted and refunds are initiated. Since the required data from the import process, such as VAT, EORI numbers and information on the goods, is already available, this simplifies the export process. MS Direct takes care of returns management. Seven Senders offers the right carrier for the wishes of British end customers.
Seven Senders international expertise
Seven Senders knows its way around UK shipping, as the company has been delivering its pan-European customers' goods to the island via local carriers for years. All carriers and service providers are bundled via an interface, giving e-tailers access to Seven Senders' carrier network. All parcels from online stores that are shipped to the UK are bundled by Seven Senders and then driven directly to the island via direct injection - this saves delivery time. Additional services such as analysis, tracking, labeling and insurance are also part of the offering, streamlining the shipping process for e-tailers.