1. November 2015
The State of International Mailing and Shipping
A Primer for America’s Small Business Owners

2. The State of International Mailing and Shipping
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CONTENT
3International Mailing and Shipping is a Lucrative, But Complicated, Business
3Maximize the Options, Minimize the Expense
4The Answer is de minimus
4What is a de minimis Value?
4The Land Down Under
4Beware of Regulations on Imports
5Avoid Potential Headaches
5Never Assume
5Information Resources
5DIY Search
5North of the Border
5Low-Value Clearance
6Duties and Taxes
6Non-Resident Importer Program
6NAFTA Certificate of Origin
6Buyers’ Expectations and Demands
7The Size of the Market
7Canada Is a Good Example
7Keep International Returns Simple and Keep Customers Happy
7Make the Season Bright
7Growth Opportunities
8Short-Term Prognosis
8Four International Shipping Activities to Expect
8The Lesson for U.S. Mailers and Shippers
9International Mail Information Resources

3. The State of International Mailing and Shipping
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Maximize the Options, Minimize the Expense
There are many areas that every shipping customer and
shipping service vendor should understand to maximize
the options and minimize the expense of international
shipping. Some of the newer ones include:
1. B2C and C2C Growth
The growth in B2C and C2C commerce has stimulated an
appreciable change in international shipping trends. That
expansion has, in turn, changed physical package
characteristics and revved-up service demand. The effects
are easy to see: shipments are becoming lighter, price-
sensitivity is proliferating, small/medium enterprise
shipping has risen and single-carrier vs. multi-carrier
options have grown fast.
2. Demand By Weight
The international shipping landscape has shifted because
of a change in U.S. air export demand by weight. Since
2005, the 21-70 lb.-package category has decreased in
popularity by 3.9 percent. Similarly, the 3-20 lb.-package
category has declined by 5.9 percent1
.
In contrast, the less-than-three-lb.-package category has
grown a whopping 23 percent from 21.7 percent in 2005 to
44.7 percent in 20131
.
There has also been a shift in U.S. air export service level
changes from 2005 to 2013. The popularity of one-to-two-
day service has fallen from 52 percent to 33 percent while
three-plus-day service has increased from 47 percent to 66
percent1
. These stats clearly show that consumers and
businesses are willing to wait a few days before receiving
their shipments.
3. Small-Business Clout
The shift from single-carrier to multi-carrier international
shipping options accelerates every year. There are four
chief market changes attributable to small businesses
increasing their presence in the export-package market:
Developed economies are investing in infrastructure and
other business-boosting benefits to capitalize on B2C
eCommerce growth.
Cost pressures are forcing competitors to look for ways
to improve profitability.
Cost management is becoming increasingly influential in
determining customers served, contract discounts and
rate changes.
Consolidators and re-mailers have become a market
force offering shipping options that undercut postal
services and commercial carriers around the world on
price alone. These consolidators and re-mailers, however,
seldom compete on service.
International Mailing and Shipping is a Lucrative, But Complicated, Business
Today’s shipping environment is complex. That’s no secret. That complexity has created more competition. That’s good
news for international shippers. Today’s globalized business and consumer markets – especially the burgeoning shipping
opportunities created by the red-hot eCommerce sector – demand that shippers have the information, resources and
tools essential for doing business in every region, every country and every location around the world.
Global eCommerce presents a vast and lucrative opportunity for
on-line retailers to grow their international business. Conventional
wisdom among international mail experts says that cross-border
eCommerce could grow more than 190 percent1
during the next four
years and the number of shoppers across the globe could increase
as much as 40 percent1
.
More and more shoppers outside the U.S. want to purchase from
American-based businesses for all the reasons we know that make
these retailers attractive to the rest of the world: the style and
quality of goods they offer, competitive prices, vast selection
options, frequent bargains and this country’s unerring devotion to
excellent customer service.
That rising level of foreign consumer interest signals two courses of action U.S. business who what to grow must follow:
1) establish and adhere to an international mailing and shipping strategy and 2) spend the same amount of time building
a positive customer experience that provides a simple and painless delivery and return event.
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4. The State of International Mailing and Shipping
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The Answer is de minimus
Many businesses shy away from utilizing a postal option
when sending international mail and parcels. Fear of
potential duties and taxes or uncertainty about mail and
parcels being held or returned cause the most anxiety.
Complicating this problem is the fact that few international
mail entities have the ability to collect duties and taxes
from the initial sender or recipient. This wrinkle could result
in an unpleasant after-the-fact bill from a destination
country’s customs authority to a recipient many months
after a shipment has been delivered.
This possibility poses a particular problem for eCommerce
and catalogue retailers who have to balance the use of a
mail service to keep international shipping cost low with
the desire to offer end-customers a secure and efficient
experience free of post facto billing.
With these caveats in mind, the best solution is to focus on
countries with a high de minimis value.
What is a de minimis Value?
For U.S. export purposes (and inbound country import), a
de minimis value is a threshold amount at which mailers
can import into a country without having to pay a duty or
tax. Although there are exceptions to this rule on certain
items – textiles are generally problematic for export
regardless of value – countries with a high de minimis value
are excellent candidates to consider when sending parcels
or mail internationally.
The Land Down Under
Australia is the best example of a country where the de
minimis values are high; it’s an excellent “test market” for
mailers who wish to start sending mail and parcels
internationally.
Currently, the Australian de minimis value is $1,000 AUD
(Australian Dollars). The value of typical U.S. export mail or
parcel shipments falls far less than this amount, which
makes Australia a great market.
Other markets with a high de minimis value include:
New Zealand: $400 NZD (New Zealand Dollars)
Honduras: $500
Ecuador: $400
Singapore: $400 SGD (Singapore Dollars)
Dominican Republic, Peru, Panama and Uruguay: $200
Beware of Regulations on Imports
The fact that these markets have high de minimis values
does not automatically mean it is easy to send mail or
parcels from the U.S. It is important to know the types of
shipments that have restrictions on importation.
Restrictions may include the amount an individual can
import into a country in a year or an outright ban on the
item being mailed.
In general, these categories tend to fall outside the
de minimis and may be difficult, if not illegal, to send using
an international mail service:
Jewelry
Textiles, especially in countries known for exporting
them (i.e. wool in Australia and New Zealand)
Alcohol
Tobacco
Lottery tickets or gambling-related items
Medication and pharmaceuticals
High-value electronics
Used or refurbished items
Literature and printed material featuring political
points of view
One of the most exasperating aspects of international
mailing and shipping for U.S.-based companies is that
customers cannot send anything anywhere. Certain
restrictions apply, as they say in the fine print of many
business offers. Local protectionism for domestic
industries, political considerations, the threat of disease or
pre-empting potentially illegal activities are just a few of
the plausible reasons certain items cannot be freely
shipped or mailed.
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5. The State of International Mailing and Shipping
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Avoid Potential Headaches
For reasons Americans may not fully appreciate, horror
comic books, unpopped popcorn and blue ice (the airplane
lavatory byproduct) create a cornucopia of intrinsic
headaches for domestic mailers and shippers. This list of
some of the more unusual prohibited items (at the time of
this writing) for importation into certain key trading
markets will be helpful to every U.S.-based mailer and
shipper. A partial roster, by country, includes:
Australia: flammable nightwear, pine cones, unpopped
popcorn and honey
Canada: switchblade knives
China: matches, play money, collectible coins and
stamps, blue ice, printed materials and literature
considered political by nature
France: Internet modems for personal use, chocolate,
vitamins
United Kingdom: horror comic books and material for
printing them, eggs, dried meat and jerky-style products,
foreign-prison-made goods, soil and straw
Never Assume
These details are important to U.S. mailers and shippers for
the simple fact that many items commonly shipped within
the United States are prohibited for importation into other
countries. Failure to comply with this concept could result
in delayed or returned shipments, fines and penalties and
even a personal ban on importation into a market by a
foreign customs authority. Never assume that you can mail
or ship items overseas because they can be mailed or
shipped in the U.S., even for items that you might consider
benign in nature. The key question: How do you know if
your item is prohibited or restricted?
Information Resources
There are plenty of resources that can tell you if you can
send an unsigned credit card from the U.S. to India (you
can’t) as well as other specific and necessary pieces of
mailing and shipping information. Consult with a licensed
customhouse broker to determine if you can send an item
to a particular country or if there is a limit on the quantity.
If there is a quantity restriction, a broker might be able
to petition a customs authority or consulate for the right
documentation and recipient vetting so the item can
be imported.
DIY Search
There is also a self-help solution. Take advantage of the free
or low-cost resources available through the Department of
Commerce (www.export.gov), the International Trade
Administration (www.trade.gov) and U.S. Customs and
Border Protection (www.cbp.gov). All three of these
information sources provide extensive expertise on
exporting from the U.S.
North of the Border
Canada is the United States’ second largest trading partner.
(China is first.) Geographic proximity, as well as product
preferences and consumer tastes that closely parallel those
in America make our neighbor to the north an attractive
market for U.S. shippers and mailers.
The North American Free Trade Agreement (NAFTA) adds
an attractive perspective as well. NAFTA has made
commerce between our two countries easier, and more
lucrative, than at any time in history. Nevertheless, there are
some important details that mailers and shippers should
heed when sending items to Canada.
Low-Value Clearance
Canada allows goods valued less than $2,500 CAN
(Canadian dollars) to be imported for expedited release as
long as goods are for personal use and not intended for
resale or other commercial uses. The resulting benefit of
this simplified clearance process is a faster transit time
from sender to recipient.
The company handling the shipment – a courier, postal
authority or customs broker – must be enrolled in the
Helpful Tip
International mailing and shipping
rules and regulations can – and do
– change often. You are responsible
for keeping current on prohibitions
and restrictions if you want to mail
or ship successfully overseas.
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6. The State of International Mailing and Shipping
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Canadian Courier Low-Value Shipment Program to
participate in this program.
Prohibited and regulated goods, such as tobacco, firearms,
pharmaceuticals and controlled substances, are not
included in this program regardless of shipment value.
Duties and Taxes
Yes, Canada’s Low-Value Shipment Program allows
qualifying shipments to be cleared easily. Be aware,
however, that it does not exempt the sender or recipient
from applicable duties and taxes. Shippers must work with
a courier or mail partner who has a brokerage-inclusive
shipping product and the ability to receive the duties and
taxes as a bill from the carrier or to pay Canadian customs
directly.
The best example of this is an air courier shipment in which
the courier acts as the customs broker. Two consequences
could occur if shippers do not utilize this type of service.
Shipments could be held by customs. It’s also possible that
shippers or recipients could receive a duty bill from
Canadian customs as many as nine months after a
shipment is delivered.
Non-Resident Importer Program
This popular program for parcel shippers and mailers,
especially those in business-to-consumer eCommerce,
allows them to work directly with Canadian authorities and
establish, in essence, a proxy. This stand-in status bestows
the benefit of being treated like a Canadian business. One
of the major benefits is the authorization to pay duties and
taxes directly to Canadian authorities, thus avoiding
unanticipated, after-the-fact bills for shippers, mailers or
their customers. This option is especially popular for
commercial entities who wish to sell products to customers
utilizing a “fully landed cost,” in other words, including
Canadian duties and taxes in product price quotes.
The Non-Resident Importer Program also allows the sender
to utilize a mailing option because the duties and taxes
ultimately revert back to the original sender.
Shippers and mailers in the program may also be eligible
for preferential duty rates and rebates associated with
Canada’s Goods and Services tax.
A licensed customhouse broker can help U.S. shippers and
mailers set up the Non-Resident Importer Program, which
requires obtaining a Canadian business ID number, a Goods
and Services tax registration number and an import/export
number.
NAFTA Certificate of Origin
The North American free-trade zone, the largest free-trade
area on Earth, accounts for more than a quarter of the
world’s total gross domestic product. Many duties and
taxes have been reduced or eliminated thanks to the North
American Free Trade Agreement. Goods manufactured
within the NAFTA region, however, need a NAFTA
certificate of origin to qualify for those duty and tax
benefits. A certificate of origin may be used for a single
importation of a product or multiple importations of
identical ones. A certificate of origin (available in most
shipping-related software) must be completed and signed
by the exporter of the shipment.
By understanding the Canadian Low-Value Import Program,
Non-Resident Importer Program and the NAFTA certificate
of origin, U.S. parcel shippers and mailers can potentially
expand their business opportunities to more than 34 million
new customers. Knowledge is the key to success in this
situation.
Buyers’ Expectations and Demands
As previously stated, the growth in eCommerce has
opened new markets to U.S. retailers all over the world. As
those international opportunities increase, so do foreign
buyers’ expectations. Online shoppers – the recipients of
international parcels and packages – are shifting their
buying habits. In fact, they are trending toward smaller,
more frequent, lighter-weight shipments delivered directly
to their homes or other convenient pick-up locations and
demanding flexible shipping options.
That last point is particularly significant because consumers
outside the U.S. are generally responsible for selecting a
carrier for an international return and covering the
associated cost. This predictable boom in cross-border
eCommerce will fuel the need for easy-to-use and
inexpensive returns protocol. A full-circle retail strategy
serves businesses well; exceptional customer service for
returns can be equally, if not more, important than delivery.
Shipping to Canada
Shippers and mailers can find basic
information about Canadian commerce at
www.export.gov. For answers to specific
questions, consult a licensed customhouse
broker with special expertise in Canadian
shipping and mailing regulations.

7. The State of International Mailing and Shipping
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The Size of the Market
The Atlanta-based Colography Group, a research and
consulting firm specializing in market intelligence for
multinational shippers, discovered several fundamental
facts that define international consumers and the size of
the international market for mailed returns to the U.S.,
including:
Customers outside the U.S. carefully consider a U.S.
merchant’s return policy prior to purchasing.
Nearly 8.5 million packages are returned each year to
U.S. air export shippers. That is almost five percent of
U.S. air export shipments in the less-than-70-pounds
category.
Among the different Colography-identified international
mail returns segment – mail order/etail, retail, telecom,
manufacturing, wholesale and other industries – returns
were most common in the manufacturing and
wholesale segments.
Canada Is a Good Example
In a separate study, Colography explored how returns and
return policies affect the purchasing behavior of Canadian
consumers. Survey data of
Canadians revealed that
approximately one of every
four active online consumers
returned an item purchased
within the previous 12 months.
Almost three of every four
Canadian consumers stated that a
retailer’s returns policy influenced
their decision to purchase from a
particular merchant.
The behavior of Canadians coincides with the global
landscape of international returns. Many buyers will drop
an etailer in order to find one that offers the customer
service they expect. Further, three out of four buyers
make their purchase decision based on tracking services
offered (email or text notifications, etc.) – for both delivery
and returns.
Keep International Returns Simple and Keep
Customers Happy
Shipping costs on returns is a noted point of contention for
customers. In fact, the most common complaint from
customers is paying for return shipments. Companies that
seek carrier agreements that include return options
differentiate themselves and create a competitive
advantage, resulting in increased favor among customers
who appreciate the flexibility.
Make the Season Bright
Global shipping takes on unique characteristics during the
holiday season. Despite the upturn in per-piece volume,
risks to the global outlook still prevail. Those risks include:
Emerging economies’ near-term growth being softened
by low commodity prices and waning consumer demand
in China
A bumpy transition of the China growth model from
export to domestic demand
Economic pressure from geopolitical tensions
Growth Opportunities
That said, there are still growth opportunities for the
shipping carrier industry.
Take a close look at the 2015 holiday season. U.S. retail
sales grew 12 percent to 13 percent compared with 14.4
percent in 20141
. Some of this was caused by the
proliferation of periodic non-holiday sales events in 2015’s
third quarter which affected traditional holiday spending.
Evidence of this transition from “holiday season” to
periodic shopping events can be found in Australia’s Click
Frenzy which saw a 27.7 percent grow in sales in November
2014 vs. 20131
. Amazon Prime Day on July 15, 2015, was
global and open to all Prime members as well as new
customers who signed up for 30-day trial memberships.
These and other similar events will, most likely, be repeated
and expanded to include other dates prior to the traditional
holiday shopping season.
Another manifestation of this periodic retailer shopping
events phenomenon is the online globalization of the
holidays. Most of these events will sound familiar:
Singles Day, in November, in China, Hong Kong and
South Korea
The aforementioned Click Frenzy, in November,
in Australia
Black Friday, in November, in the U.S., U.K., France and
South Korea
Cyber Monday, in November, in the U.S., U.K., Australia,
France and Japan
Green Monday and Super Saturday, in the U.S., in early
December
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8. The State of International Mailing and Shipping
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Short-Term Prognosis
The international shipping competitive landscape will
develop in these ways during the next two to five years:
Trading-partner economies will stabilize but short-
term demand for U.S. goods will diminish because of
a strong dollar.
Canada may be the strongest near-term growth
opportunity for major partners in North and
South America.
Long-term GDP outlook for Mexico is strong.
Near-term outlook for European trade is improving but
likely to weaken over the long haul.
Near-term trade growth with Asia has tapered
significantly but remains a strong long-term growth
opportunity.
Cross-border eCommerce is projected to grow
enormously in the next three years. Cross-border revenue
in 2018 is expected to hit $307 billion (up from $105
billion in 2014) and cross-border shoppers are expected
to increase by 40 percent in that same time span1
.
The preference for deferred service will continue for
several years.
Competitor acceptance of market realities will prompt
strategies to balance networks, manage costs, exploit
trade with Canada and Mexico and optimize position for
deferred services demand.
Efforts to expand free trade agreements, improved
trade credit and stronger trading partner economies
will aid U.S. package exports but there will be no near-
term improvement.
Four International Shipping Activities to Expect
International shippers can expect:
B2C and B2B business to continue growing
Fierce competition among existing international shipping
carriers and new market entrants to pressure commercial
carriers to modify their global strategies
Commercial carriers to transition more international
deferred air volume out of express networks
eCommerce cross-border shipping to continue to
out-pace global economic growth
These details serve one, all-encompassing goal: to help
ensure that everyone in the international shipping chain –
carrier, customer and recipient – has the best possible
experience. That ideal objective ensures that the cycle will
continue to expand and grow.
The Lesson for U.S. Mailers and Shippers
Shoppers in the ever-expanding global eCommerce world
have made four unambiguous and universal points that
affect international mail return behavior:
International consumers are increasingly savvy buyers.
They review international merchandise return
policies carefully.
Convenient and simple return options influence their
purchasing decisions.
Affordable returns options will contribute to
repeat customers.
U.S.-based international mailers must consider and respect
these consumer behaviors when selling in the global
marketplace.
Customers expect an easy experience from the etailers
they choose to do business with.
Providing a simple return procedure pleases customers,
expands the frequency of transactions and, ultimately,
raises the per-event purchase amount customers elect
to spend.
1
Source: The Colography Group, based in Atlanta, GA, delivers
research, planning and program development services to
businesses and governments worldwide looking for growth
opportunities in the global time-definite, or expedited, cargo
market. Its suite of proprietary databases is based on information
gained from interviews with hundreds of thousands of shippers.
Through these interviews, The Colography Group extracts market
intelligence clients use to plan their transportation strategies.
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9. The State of International Mailing and Shipping
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About Neopost USA
Neopost USA provides mailing, business communications management and shipping hardware and software
solutions. For generations, we have worked with our customers to send, receive and connect their customer
communications in the most secure, efficient and professional manner possible. As businesses increasingly move to
digital communications, we continue to help our customers communicate via physical mail, digital communications
and parcels. For more information on Neopost USA, visit www.neopostusa.com.
Authors
Vincent DeAngelis, Vice President, Postal Relations, Neopost USA
Krishna Iyer, Director, Marketing, Neopost USA
International Mail Information Resources
Consult with a licensed customhouse broker who can answer your specific questions about international mail.
Utilize the commodity look-up feature on www.export.gov for explanations of the regulations and restrictions that may
affect international mail.
Take advantage of free or low-cost resources available through the Department of Commerce (www.export.gov), the
International Trade Administration (www.trade.gov) and U.S. Customs and Border Protection (www.cbp.gov). All three of
these information sources provide extensive expertise on exporting from the U.S.
Acknowledgement
Neopost USA amalgamated the content of this white paper from a six-part series written by its experts and published in
Mailing Systems Technology Magazine throughout 2015.