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.
“In the world of international logistics, the declared value on your commercial invoice is the key that unlocks smooth customs clearance,” says Darren Lavelle, Chief Experience Officer at Capacity. “Declare it accurately to avoid delays and ensure fair duties and taxes.”
Declaring a value that’s too low can trigger red flags for customs, especially if agents believe the true value is higher — leading to delays and even revaluation penalties.
“Some countries have very strict customs regulations which can delay deliveries,” Lavelle adds. “Navigate the maze of customs regulations with confidence. With the right 3PL partner, your shipments keep moving with precision.”
To avoid surprise charges, 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 ensures customers see a full, transparent cost breakdown during checkout, reducing friction and protecting margins.
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.
4. DDU vs. DDP Confusion
Many brands default to Delivered Duty Unpaid (DDU), which shifts the burden of duties and taxes to the customer. This can create friction and result in abandoned shipments or frustrated buyers — especially when brands send products to influencers or VIPs.
“Don’t let the DDU and DDP dilemma trip you up,” Lavelle cautions. “Brands often default to DDU, shifting the burden to recipients. But with the right guidance, you’ll ace the terms every time, preventing any embarrassing duty surprises for your influencers.”
Lavelle notes that forgetting to change the terms on influencer or press orders is a surprisingly common and awkward mistake. Imagine sending a free product — only to have the influencer ping you with a screenshot of a $45 duty bill.
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.
“Understanding the commercial invoice, customs expectations, and fulfillment terms is critical,” Lavelle summarizes. “What feels like a small oversight can cause big delays, lost revenue, or damaged relationships.”
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.
