UK 3PL or third-party logistics companies are making a comeback! After the UK voted to leave the EU, many brands were unsure if they should continue to ship their products into the EU market. Now that businesses have had some time to adapt to the new Brexit landscape, it appears that a good number of them are decided – they’re going back to using UK 3PL companies to ship into the EU.
This strategic decision is one that makes a lot of sense; by using a UK 3PL company, businesses are still able to serve customers in the EU, the rest of the world and the UK. In using UK 3PLs to ship into the EU, businesses can use a “duties paid” service to do so….
So what is DDP?
DDP or Delivered Duty Paid means that the UK-based logistics company will take on all the costs of importing and clearing goods through customs, as well as any applicable taxes and duties. This removes the need for worry about anything at all – from getting quotes from different courier services to dealing with complex paperwork. The benefits of using a DDP service is clear: you can be sure that your goods will arrive quickly and securely, without your customer experiencing the inconvenience of having to pay customs charges before receiving their order. What’s more, by shipping via a dedicated logistics provider you’ll benefit from their expert knowledge of how to get your parcels through customs as smoothly and quickly as possible.
Via Royal Mail, DDP is available in Cyprus, France, Germany, Ireland, Malta, Netherlands, and Portugal. If businesses wanted to use this service, then there is a two-step process including a pre-application which would then be submitted as a request to add the services to business accounts set up by the services team.
Customers will also need to ensure they are using a landed cost calculator, so they are collecting the correct tax/customs charges at the point of sale. There is also the option of DDP with DHL (available for all countries) which is just the usual DHL rate and then the taxes which are paid and then charged back to the account are passed back to the business.
Using IOSS to ship into the EU
However, a lot of businesses that run their operations from the UK can set up IOSS or Import One-Stop-Shop if they do sell within Europe. IOSS is where the customer pays the tax at the point of sale. The IOSS number then needs to be filled out correctly on the shipment when it is created.
To process and set up IOSS for your company you need an accountant based in the EU who will be able to arrange the set up of this and process the EU tax returns/payments for you going forward. You will be given an IOSS number which will need to be used on EU shipments that are fulfilled. Also as stated previously a landed cost calculator will need to be used to make sure the customer pays the correct amount at checkout.
If using Royal Mail for EU and International shipments e-commerce businesses will need to make sure that they are using the correct IOSS compatible service. Other couriers such as DHL business would just need to ensure that they are inputting the number in the correct field – usually next to Tax ID.
Reasons for using UK 3PL
First, UK-based logistics providers have a lot of experience shipping into the EU market. They know the customs procedures and how to get products through border checks quickly and efficiently. This can be a huge advantage for brands that want to avoid delays and keep their customers happy.
Second, Brexit has caused a lot of uncertainty in the EU market. This has led to higher shipping costs and longer delivery times. By using a UK-based logistics provider, brands can tap into a wealth of experience to get their products to their customers quickly and reliably.
Finally, Brexit has created some new challenges for businesses that export to the EU. But by working with a UK-based logistics provider, brands can overcome these challenges and continue doing business as usual.
Many e-commerce brands are choosing to use a third-party logistics company in order to manage their stock levels and deliveries, rather than dealing with it all themselves. This also takes the pressure off of them and allows them to focus on other areas of their business.
Deciding whether to fulfil all orders from a UK-based fulfilment centre or from different fulfilment centres based in various countries needs serious consideration and costing. One thing to consider is if your business has hundreds of SKUs through multiple warehouses, there is a big challenge in making sure you have the right quantities for the right warehouse. On the other hand, a business with just a couple of SKUs, would be easier to manage. E-commerce businesses need to ensure it has the right amount of volume to justify a move before basing the fulfilment in different countries.
It’s important for any online business looking into expanding internationally within Europe (or anywhere else) to do thorough research about what companies they might use as well as reading reviews from customers who have used those services already.
OFEX are the Order Fulfilment Experts. We provide an efficient, transparent service in order to take the stress of order fulfilment out of your hands. After all, the more time you have, the more opportunity you have to grow your business. If you’re interested in the order fulfilment opportunities OFEX can offer your business, contact us today. If you’re still not quite sure about making the move to outsource your fulfilment, OFEX is offering a free trial, so you can experience the benefits for free, risk-free.
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