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US cross border boom on the cards


UK retailers exporting to the US could be about to enjoy a boost to their efforts, thanks to a change in US customs law; starting just a few days ago, the US Duty threshold has risen from $200 to $800.
This one change will make selling to US customers simpler and cheaper at a stroke, with the value at which duties and taxes apply being raised from £140 to around £560. Not only does that make it easier for UK retailers to compete on price, but those goods that are under the US duty threshold can bypass formal customs procedures, speeding up deliveries into the US.

Global parcel brokerage firm, ParcelHero says British businesses can expect to see an influx of thousands more orders from the US, as well as making significant savings in terms of delays and red tape.

ParcelHero’s head of consumer research, David Jinks MILT, said: “Many British products previously fell foul of the USA’s $200 limit before duties and taxes were applied. These duties usually had to be paid for by the receiver. It made our products less competitive than those purchased within the US, as most items valued over $200 had duties imposed on them, at a rate ranging from 0% to 37.5%, with the average duty rate being 5.63%.”

The new higher limit covers most goods sold by the majority of the UK’s online marketplace traders, and many products sold by SME companies. It also reduces costs and paperwork for businesses.

According to ParcelHero, around 35% of UK SME exporters ship regularly to the USA. However, the broker warns that not all items will be free of red tape just because the order value evades the new threshold.

“Some US government agencies, such as the Food and Drug Administration and the Bureau of Alcohol, Tobacco, Firearms and Explosives, may still require formal customs entries on all goods, regardless of value,” said Jinks.

Last month, Royal Mail’s annual tracker study into smaller one retailers found a healthy appetite to export to Europe and the US among UK e-tailers.

More than half (56%) of those surveyed said they aim to increase international sales in new and existing markets this year.

While 48% of small online traders aim to sell their products in the Eurozone in 2016, up from 30% in 2015, almost a third (30%) believe the USA will offer the greater opportunities in the coming year, as our partner title InternetRetailing reported.

Royal Mail’s study found 40% of smaller UK online retailers are put off exporting by a lack of knowledge, while 23% said shipping to international markets was too complex.

Richard Snowdon, international director at Royal Mail said: “Royal Mail’s annual tracker of small online retailers shows that there is a huge appetite for exporting among UK small businesses. But it also shows that over a third could be missing out on sales by not actively promoting their international capabilities to encourage foreign custom. We believe that 2016 could be the year that exporting becomes big business for small online retailers in the UK and we have a range of international delivery options designed to make this process as simple as possible.”

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