Guest Post by Alex Pejak, follow Alex on Twitter: @AlexPejak
Selling overseas is a fantastic way to increase the size of your customer base. Nevertheless, there are a few details you should have in mind if you want to sell your products internationally to avoid any trouble.
International sales can raise questions about payment method and currency. As a result, many companies choose to accept PayPal, which is a popular vendor that lets you be paid from debit cards, bank accounts, and credit cards in many different currencies.
Of course, fraud is always a risk when selling online. Still, international fraud can be a more significant issue, partly due to certain countries being ‘magnets’ for fraudsters and also due to overlapping or simply lacking rules and regulations when it comes to online crime overseas. You can significantly lower the risk of fraud by requiring buyers to pay in full up front, and by stating clearly that you will not dispatch products until you have received full payment.
Choose your countries
Keep in mind you are not required to ship to every country in the world. Learn about the consumer laws in the countries you are planning to sell to, and consider restricting sales to only those countries which you feel comfortable with. Marketplaces like eBay will usually give you a choice of the countries you will ship to — and which you will not.
Terms and conditions
There is no general, comprehensive Terms and Conditions that will cover international commerce in every jurisdiction. In general, if you sell to customers who are located in another country or even another state — then your business is subject to the laws or regulations of that jurisdiction. Your customers could sue you in their local court, and sometimes even close down your business if it is declared to be in breach of their local laws.
According to this Terms and Conditions guide, one effective way to defend against this is to have strong Terms and Conditions which are written by Australian lawyers to Australian laws. Then, ensure there is a Governing Law clause that states your Terms are governed by the State legislation in the State you nominate.
This way, when customers agree to do business with you, they agree to be bound by your Terms, and your Governing Law clause. Therefore, any claim or dispute must also be made in the State you nominate. It’s a simple addition which can save you the difficulty of having to travel overseas to defend a legal claim.
In order to maximise your degree of protection, you should ensure customers must ‘actively’ agree to the Terms by ticking a box or otherwise indicating that they positively consent. This is in general even easier to enforce. Of course, while many countries accept Governing Law clauses, some countries may argue the clause is void because it is not in the interests of their own consumers or contrary to their public policy. Generally this has depended on the case and the country’s own regulations.
Alternately, you can begin with standard Australian Terms and Conditions. Then, once your business has grown, have special Terms written to suit the other major markets which you service, such as the United Kingdom and the United States.
When selling internationally, you should think carefully about the cost and logistics of shipping. Remember that the price of the product is part of the contract you have with the customer, and shipping out of Australia may be expensive. It’s important for buyers to be clear on how much they’re paying for the actual product, and what they are paying to ship it to their country.
It’s generally useful to have a shipping calculator or shipping costs listed on the website so buyers can determine shipping costs in advance. Consider also offering multiple shipping options — some might be cheaper but take more time to arrive, whereas others might be more expensive yet come with the ability to track the parcel. Overall, using a shipping service that offers tracking is prudent, since it allows you to prove that you shipped the product and that it was delivered to the customer.
Sending products to another country means they go through customs, which may mean customs duties. Each country will determine whether to charge duty on certain products and how much to charge. While you can research each country’s customs practises, it’s generally standard for the buyer to be responsible for paying any duties. Therefore, your terms of sale should be clear that the product price and shipping does not include import or customs duties, charges, or taxes.
Alex Pejak is an economist currently working on a few projects in Australia. She is interested in topics related to project management and business improvement.