At World Trade Center Utah, we hear the same story time and time again. A small business with a cool product is growing fast. The company has started to receive inquiries from international customers, but doesn’t have the first idea how to fulfill international orders or have an understanding of the rules and regulations to sell abroad.
Fear of the unknown often prevents these companies from capitalizing on prospective international customers. The good news is this does not have to be the case. A Utah software company has the solution to make online international sales a simple process.
Technology is power
Zonos, formerly named iGlobal Stores, is an e-commerce and Saas technology company located in St. George that is seeing a lot of growth thanks to its innovative software. It created a website plugin for small-to-medium-sized businesses and APIs for the large-to-enterprise-sized companies, to calculate duties, taxes and shipping rates for their international customers in real time at checkout and during the shopping experience.
So how does this all work? When international customers visit a website that utilizes Zonos’ software, they immediately see a pop up welcoming them to the website and letting them know that they can buy and have products shipped to their door. After putting the products they want in their online shopping cart, they proceed to checkout. Instead of going to the domestic checkout, the customer is sent to Zonos’ checkout page, which looks similar to that of the company’s. The customer inputs his/her address, the plug-in analyzes the items in the cart and then the customer is able to see shipping options and the duties, taxes and brokerage fees to deliver the product to their country.
Customers from Tooele to Timbuctoo can now have the same comfortable and information-filled checkout experience.
Shipping rates are calculated based on the rates the company negotiated with its shippers. For example, if the company ships with UPS, the Zonos team pulls those rates directly from the company’s UPS account and inputs them into its software.
More than 400 U.S. websites utilize Zonos’ services. Merchants using the Zonos Checkout have found their international sales increase significantly, which adds millions of additional dollars into the U.S. economy.
The value
It is important that pricing for international customers is transparent so they can make an informed decision on their potential purchase. Unfortunately, a hardware store owner in Montana had to learn this lesson the hard way. His experience is not unique, and it shows why services like Zonos’ matter.
This business owner received an order for a $2,000 piece of hardware from a gentleman in Brazil. The business owner disclaimed on his website that customers are in charge of duties, taxes and fees that arise from international transactions. He only charged customers for the price of the product and shipping.
Well, here is where things got sticky. Brazil’s import duty and value-added tax is very high. When the UPS worker walked up to the man in Brazil with the hardware, he also delivered a $1,200 bill. The customer was shocked because he had already paid $500 for shipping and refused the delivery.
The UPS worker took the hardware to a customs UPS warehouse where it was held until the issue was resolved. The Brazilian customer felt cheated and charged back the purchase on his credit card. The business owner in Montana was left in a bit of a conundrum. He didn’t have any money in his account from the sale, already paid UPS to carry the products to Brazil, and found out it would cost even more in shipping to return it to the United States. On top of that headache, the Brazilian customer took to social media to discredit the company, calling the hardware store owner a robber.
Small-to-medium-sized businesses can’t afford pitfalls like the one experienced by the businessman in Montana. This sad story has a happy ending because the hardware store owner is now a Zonos customer and hasn’t had an issue since.
The bottom line
Zonos’ software helps companies mitigate risk, sell to over 200 different countries and translate checkouts into 18 different languages. Customers have the option to pay in their local currency or the currency of the foreign country they are purchasing from.
Utilizing services from a company like Zonos is a good option for companies that have international inquiries trickling in, but limited global trade experience. For a small fee, these businesses can utilize a resource that makes their website friendly to international customers and helps them abide by trade laws. It is a great option for those just getting their feet wet in international business.
Derek B. Miller is president and CEO of World Trade Center Utah, an organization dedicated to helping Utah companies think, act and succeed globally.