Package Forwarding: What is it, and What Are its Benefits?
The rise of ecommerce has spawned a range of new business and consumer services that support online retail. One such service is package forwarding.
Not to be confused with conventional mail forwarding/redirection, package forwarding is a convenience-service for consumers who like to buy online from stores outside their home country.
Perhaps you've been wondering about package forwarding and whether it should matter to you as a retailer, or if it was something of import only to consumers. If so, here's a quick rundown of what it is and how it's used.
So What’s Package Forwarding All About?
You may have heard of, or even used, a mail forwarding service in the past. Concerning online sales, though, the concept of package forwarding (sometimes called parcel forwarding), is a little different from global mail forwarding.
For one thing, it is a service that exists specifically to help international shoppers buy from their favorite online stores overseas—or at least across international borders.
Essentially, package forwarding is a service that provides consumers—and sometimes businesses too, if they engage in online procurement from vendors abroad—with a delivery address in the country of shopping.
By having the store ship their purchases to this domestic address, sometimes called a virtual address, international shoppers benefit from:
- A checking and inspection service for their goods
- An international shipping service to get their purchases into their home country
- Delivery of each parcel to their home or specified final delivery address
These facilities combine to enable consumers to buy online internationally, with the same ease that they enjoy when shopping on domestic ecommerce sites.
Breaking Down the Package Forwarding Process
Perhaps the best way to explain package forwarding, is with an example. Suppose you are a consumer living in the UAE. Moreover, you like to buy products typically available only in the United Kingdom.
Of course, you can visit a UK online store that sells these products. Still, you may find it doesn't support international delivery, or perhaps the shipping rates to your country are just too high to justify the purchase.
Instead, you register with a package forwarding service, and from there, the entire process becomes less costly and more straightforward. Now you can shop in any online store in the United Kingdom. Here’s how it works:
You sign up for the package forwarding service. Most operate on a membership basis, so you may be able to choose between a basic level of service and one with additional features or better shipping discounts.
The service provider gives you a virtual address in the United Kingdom. Don't be confused by the "virtual" term. It's a real address, typically a warehouse belonging to the service provider or its logistics partner.
Any time you wish to shop in a UK store online, you browse the website (just as in any online shopping scenario). You choose your items and visit the checkout page to pay and arrange delivery.
You use the virtual address as the ship-to address for your purchases so that the vendor will send your order to the package-forwarding company's warehouse.
The forwarding company receives your purchases, unpacks and checks them, then repackages them for international shipping.
The forwarding company ships your purchases to your home country, typically at a discounted shipping rate, handles customs clearance for you, and finally, delivers them to your chosen address.
Package Forwarding Benefits for the Consumer
Hopefully, the example above highlights the simplicity that parcel forwarding offers for international shoppers. Indeed, simplicity is one of the key benefits for consumers. Of course, it can never be entirely as straightforward as domestic online shopping.
For example, customs clearance procedures at international borders include the possible imposition of taxes and fees that are unknown when the shopper makes a purchase. These fees may be added when the goods reach a border, and the consumer is responsible for paying them.
Nevertheless, there are more benefits than drawbacks for consumers engaging with a package forwarding provider. Some of the key advantages are as follows.
Shopping Freedom
Consumers using a parcel forwarding service can shop in any online store abroad, as long as it is in a country supported by the service. They don’t need to be concerned with vendors’ international shipping service costs or policies.
More Buying Power
With many package forwarding services operated by freight forwarding or logistics companies, they typically offer more affordable international shipping rates than those applied by merchants. That means shoppers have more money in their pockets, which, if they wish, they can use to shop more frequently.
Value-Added Services
Some package forwarders offer extra services to members. For example, they might provide shoppers with digital images of their items after unpacking them at the warehouse, or allow them to consolidate multiple orders for lower shipping fees.
Fewer Complications
Online shopping abroad can be a complicated endeavor. A package forwarder can simplify things for the shopper in several ways. For instance, by:
Unpacking and inspecting the shopper’s purchasers, enabling a return to be made before the product leaves the country of origin
Giving the shopper a fixed set of fees and shipping costs, regardless of which merchant purchases are made from
Handling the entire shipping and delivery process, from the country of origin, to the shopper’s doorstep
Managing border formalities and handling all processing and fee transfers
Providing track-and-trace visibility into the shipping and delivery process
Enabling the shopper to follow a familiar online process, regardless of where she shops
Think Freight Forwarding on a Small Scale
As mentioned above, package forwarding services are often launched as spinoff ventures of freight-forwarding companies and fulfillment/logistics providers. The reason for this is that these types of enterprises often have the appropriate infrastructure already in place.
Freight forwarders typically have warehouses (or partners with warehouses) and tight relationships with carriers and customs brokers. This access to assets and facilities makes it relatively easy to set up a process to forward parcels in addition to managing large freight shipments.
That brings us to the potential advantages that a package forwarding service, operated by a logistics company or freight forwarder, can offer to you as a retailer.
Should You Partner With a Package Forwarding Service Provider?
As more parcel-forwarding services emerge to support the burgeoning growth in international ecommerce, you'll probably start to wonder if there are benefits to partnering with one of these providers.
The answer might depend on which types of global mail forwarding or parcel-forwarding companies you consider. The most significant advantages for your business are likely to come from those that combine package forwarding with other international fulfillment or logistics offerings.
The Advantages of Finding the Right Parcel Forwarder
The primary benefits of package forwarding apply more to the consumer than the retailer. However, suppose you partner with a forwarding company that offers an attractive consumer package and low shipping rates.
In that case, you have the possibility for your brand to become associated with simplicity and affordability as an international vendor. In doing so, you will find it easier to reach beyond your domestic markets and enter lucrative emerging ones overseas.
At the same time, or later, you might wish to start pushing some of your products into those markets abroad, enabling you to sell as a domestic merchant. If your package forwarding provider has ecommerce fulfillment capabilities and offers an international shipping service, storing and selling inventory overseas will be relatively easy. After all, you won't even need to look for new fulfillment partners.
Make Parcel Forwarding the Start of Something Big
So there you have it. You know what package forwarding is. As a service, you know that it offers significant benefits for international shoppers interested in giving you their custom. You also understand that partnering with a package forwarding provider can bring advantages to your business, especially if global sales are a key objective.
Nevertheless, it might not be easy to find and select the best provider to approach. A lot will depend on whether you can find one that ships from your country to those where you'd like to attract custom.
Perhaps the first step, then, is to identify a lucrative target market. For instance, the Middle East is currently ripe with opportunity for ecommerce market-entrants based in Europe or North America.
Once you know which markets you'd like to engage with, you can start to look for a forwarding partner that serves its international shoppers.
Let’s imagine for a moment, that the GCC region of the Middle East is on your shortlist. In that case, Shipa Mall is one of the few package forwarders that specialize in that area exclusively, and hence have in-depth knowledge of customer needs and expectations.
From Package Forwarding to Full Internationalization: The Shipa Advantage
The Shipa family of products is a prime example of integration between freight & mail forwarding, ecommerce fulfillment, and parcel delivery. To illustrate a hypothetical scenario, here's what could happen if your business was to partner with Shipa Mall parcel forwarding.
Your customers in the Middle East, particularly the Gulf States, could immediately take advantage of that platform's low shipping rates and simple processes for international shopping. They would also receive convenient home delivery of their international purchases from Shipa Delivery.
If you wished to maintain a local inventory in the GCC region at a later stage, Shipa Ecommerce would handle your local fulfillment for you.
Best of all, your entire fulfillment operation would benefit from seamless integration with Shipa's technology platforms. That would keep everything simple for your business, as well as its customers.
Ready to Get Started?
It's easy to grow your retail business and take it global with Shipa. Would you like to get started by offering international package forwarding to your customers?
If so, why not contact the Shipa Mall team to learn more about our parcel-forwarding and international shipping partnership program?
