Factors Affecting Overseas Shipping Costs

Product or service prices seem to change on a dime these days. Why is that so? Whether you are a business owner or not who has been shipping goods overseas, you might have noticed the gap between the rates now and several years ago. It is not a secret that many variables are affecting shipping costs. Economic conditions due to international disputes and high fuel prices are a few factors influencing shipping rates in Australia and worldwide. Understanding the factors that influence them is crucial to better prepare for the ever-changing shipping costs.

Learn more about the factors that have a significant impact on overseas shipping costs in this article. Grab a pen and paper to jot down some essential tips. Continue reading below!

Here Is a List Consisting of Overseas Shipping Costs Variables

The rising popularity of e-commerce, plus the recent global health crisis, made courier companies one of the most in-demand industries. They cater to many individuals sending items from one place to another. Moreover, courier services now provide more conveniences than ever. But in return, shipping costs seem to have ramped up. If you are curious about what causes the increase in overseas shipping costs, check the items in the list below:

Size, Weight, and Transportation Method

The most prominent factors that can affect shipping costs are the size and weight of the container, as well as the mode of transportation used for the shipment. Usually, air and ocean freight shipping are the two main options when sending goods overseas. There are only a few options for land transportation. It only makes sense to use proper packaging or container to protect the items while in transit and determine the ideal transportation methods when shipping internationally.

Apart from the container size, weight, and mode of transportation used, there are some factors that many oversee. These are not upfront aspects of shipping processes, but still, they play a vital role in successfully sending packages abroad.

1. Cost of Fuel

Fuel is the driving force of transportation. Without it, modern transportation, including logistics, won’t be possible. Courier services rely highly on different transportation methods when shipping packages to their destination, such as cargo ships, trucks, and planes. It is not difficult to understand that when fuel prices increase, shipping costs spike, too. It goes without saying that shipping costs are always associated with fuel costs.

The effect of increased fuel prices does not only influence courier companies. Many events can set off a change as soon as there is a slight adjustment in fuel supply. The reduction of fuel costs lies in the hands of oil producers. If a major company has ample oil supply, it can disseminate a portion to flood the market and cut down fuel prices.

Because of the unpredictable fuel prices, several courier companies invest in energy-efficient shipping methods. It is a way to curb their dependency on fossil fuels. Besides that, it can lessen the adverse impact of rising fuel costs on the rates of overseas shipping services.

2. Trade Tariffs and Customs

International shipping is a cross-border transaction, which means it has the potential to incur trade tariffs, the taxes on goods imported from another country. Various territories have different custom policies covering packages that come from abroad. Shippers must know the logistics regulation of the places they ship to. Otherwise, delays, penalties, and legal proceedings might occur.

On the other hand, a country decides to impose trade tariffs to contribute to production and manufacturing or penalise unlawful behaviours. When a country implements trade tariffs, the receiving country may implement trade tariffs, too. And it limits trade between the two countries.

3. Security and Port Congestion

Another factor that can affect overseas shipping costs is the stiff security measures at shipping ports imposed by some countries. Authoritarian nations are the most notorious when it comes to strict shipping regulations. Countries under national emergency may also impose rigid port securities to protect them from potential threats outside their territory.

The added security measures may delay an entire shipping process, impacting the overall shipping cost. As a result, courier companies should be keen on knowing which ports levy these charges, and this way, they can adjust what they charge to their customers.

Meanwhile, nothing can come close to the busiest ports in terms of creating bottlenecks in the supply chain. With a lot of work at the forefront of every process, the potential for increased fuel costs becomes high. Some of these ports are in Asia, particularly Singapore and Hong Kong. Shipping to the busiest ports in the world has disadvantages. Ensure to be prepared for this if you ship to these destinations.

Send Packages Overseas with Couriers by Demand Express

At Couriers by Demand Express, we provide services to customers, with their needs and shipping requirements as our top priority. Sometimes, the one-size-fits-all method might only work for some. So, we ensure that our services serve our customer base and their best interests. Call us on 02 9095 5000. You may also explore our website to learn more about us and our services.