Breaking into international markets is a huge milestone for any brand. It promises broader reach, diversified revenue, and new customer segments. But with that opportunity comes a set of fulfillment challenges — many of which are underestimated until it’s too late.
Here are some of the most common unexpected costs brands face when doing international fulfillment — and how to stay ahead of them.
1. Returns That Sink Margins
Returns can quickly eat into profitability if you approach them the same way you do domestically. Processing returns across borders often involves complex logistics, high shipping costs, and potential delays. For lower-value items, the cost of bringing the product back might exceed the value of the product itself.
Instead of issuing traditional returns, brands often find success by allowing customers to keep or dispose of the product — reducing reverse logistics costs. When returns are necessary, using a consolidation point within the destination country can reduce per-unit return costs by batching shipments back to your home country.
2. Miscalculated Duties and Taxes
A common mistake is underestimating or misconfiguring how duties and taxes are calculated at checkout. This can lead to a poor customer experience when unexpected fees show up at delivery — or worse, the brand ends up footing the bill and losing margin.
To avoid this, brands should ensure they’re using systems that calculate landed costs accurately at the point of sale. Leveraging tools that offer Delivered Duty Paid (DDP) capabilities can ensure customers see a full, transparent cost breakdown during checkout, reducing friction and avoiding financial surprises on either end.
3. Dimensional Weight Discrepancies
When it comes to international shipping, dimensional weight often carries more weight (literally) than actual weight. International carriers tend to use lower DIM factors than domestic ones, which means larger packages — even if lightweight — can incur significant charges.
Brands need to ensure their shipping platforms, like Shopify, are configured correctly to factor in dimensional weight. If there’s a mismatch between the shipping fee charged to the customer and the carrier’s actual fee, brands can quickly rack up unplanned expenses. Optimizing packaging and cartonization strategies can also help reduce unnecessary bulk and lower shipping costs.
Final Thoughts
International fulfillment isn’t just a scaled-up version of your domestic process — it requires a different mindset and careful planning. From handling returns smartly to calculating duties correctly and accounting for dimensional weight, the brands that succeed globally are the ones who get the operational details right.
At Izba, we work with brands to build international fulfillment strategies that actually scale. Whether you’re exploring new markets or trying to fix a leaky global shipping setup, we can help you navigate the complexities and protect your margins.
Need a second opinion on your current approach? Let’s talk.
