Shopping is always a great way to
treat yourself and here at Global Shopaholics, we definitely recommend you
doing so. However, it can easily get complicated if the products are being
shipped to your doorstep. It is not necessarily a logistical hurdle as it is a
financial one because international shipping can get very costly. There are many
reasons as to why this is the case and they will be discussed below but for now
let’s talk about why one would choose international shipping.
One of the most basic and obvious
reasons is ordering from international websites who do not just charge for the
product itself but also take some shipping charges to cover their own costs. It
is important to realize that although these shipping charges may look like a
lot to many, they are a great way to ensure that you get delivered with your
chosen product and that too without much damage. It is usually the case that
the higher the shipping charges, the more guarantee you have as a customer that
your product will reach at your doorstep within promised time and would be
delivered by the most secure way possible. There are obviously many channels
through which your product goes through to reach you and that is how one can
explain shipping in the simplest of ways. A series of different channels that
enable and promise a safe and secure delivery of all your products just like
you expected and were hoping for is exceptional.
Before diving deep into the
Intricacies of international shipping and why it is just so expensive, it is of
significance to understand that these charges vary from country to country
because every shipping line have their own pricing and models which they pitch
to businesses who then opt for the most budget friendly shipping line. One
thing is for sure that if you are ordering from a website that is asking for
shipping charges, it is better to see if they are not just as much in price as
the product because it just becomes very off budget for most. To see which
product is worth being shipped is also very important when shopping online.
Look at your budget, the product you are ordering and its shipping expense and
if they make perfect sense and fit along the lines of your budget, what better
reason to then click ‘confirm order’.
1.
Fuel Prices
How your order gets delivered to
your designated place plays a huge role in determining the shipping rates. If
shipping is across the country, locally, one has the choice to choose from many
shipping lines because generally, there are many companies who operate inter
country. This is also more budget friendly because the customer has the choice to
opt for a least expensive shipping line and compromise on the time taken for
the product to be delivered. It is totally up to the customer though. However,
this changes if a product ordered is being shipped from a different country
altogether.
When a product is being shipped from
an entirely different country, there are many ways a shipping line gets it
delivered. There is the airplane, or the sea or a truck if there is a road
connecting the two countries. All these modes of transportation require fuel
and the most expensive one of them all is jet fuel. There is not much choice of
choosing a shipping line or method when something needs to be delivered across
countries which is why the customers then have to just accept the shipping
charges as they are. Many online businesses, both small and large, get their
inventory shipped from a different country as well so they tend to have huge
costs to cover which is why when you place an order from an international
website, the shipping price tends to be a lot higher. Fuel prices in general have
increased over the years. All three modes of transportation mentioned above
operate on this very fuel. It can indeed get costly and with every 1 percent
increase in the fuel directly affect shipping prices as well. It is definitely
one of the major factors in explaining such expensive international shipping
rates.
2.
An increment in
the Consumer Demand
Supply and demand are a huge determinant
of rising international shipping costs. It is a very simple phenomenon. With
the rise of E-commerce businesses and more and more people resorting to online
shopping, the demand of shipping has only increased. There are a set number of
containers which are shipped to various countries across the globe and every
business has a shipping line which they are in collaboration with to ship their
products in bulk to the country where the order has been placed from. It has
been observed that this capacity to shipment containers and their rolling out
has not increased much. At least not in an exponential way like the E-commerce
industry. As this market for online shopping widened, so did the demand for
shipment.
However, this is where the gap came
in. although the demand increased, the shipment containers and their space did
not. So, there were many businesses looking for international shipment but not
many containers. This made the shipping costs to rise. It is a simple concept
of the neoliberal economic system. More demand towards a concentrated type of
service causes the prices to rise. Many shipping companies increased their
prices because they observed how an increasing number of people needed their
service. They bid the highest prices and continue to do so because according to
the principle, there is a high demand so the supplier of the service has the
autonomy to dictate a price. This increase in price then leads to a rise in
shipping costs overall towards all customers. Moreover, there has not been much
fluctuation in international shipping costs, however, to avoid any sort of misunderstanding
and loss of profit, most businesses assert a specific shipping cost. This
enables them to make sure that any decrease or increase in the shipping
companies does not directly impact their profit margin. It can be said that due
to the continuous increase consumer demand and a growth in the E-commerce
market, there has been a very high rise in the international shipping costs
deeming them expensive worldwide.
3.
COVID’19
One of the biggest health crises of
the 21st century, COVID’19 Pandemic indeed had a huge part to play
in the rising prices of international shipping. It not only effected the lower
income economies but has a devastating impact of the developed ones as well
which then has ripple effects across all industries, shipping being one of
them. China and Europe being amongst the largest manufacturers of products,
there are many shipping containers which land everyday on their ports and get
ready to be shipped across the globe in different countries. This was a very
common practice before COVID and there was a proper management system which
checked and authorized these containers and their mode of transportation.
Millions of worth of consumer products and goods were transported in and out of
these large countries. However, things drastically took a decline when COVID
hit. Due to the sensitive nature of the virus and its fast transmission rate,
all the shipping processes stopped. Many shipping containers which were already
in China and Europe were stuck there. Mostly in China, there were large numbers
of containers and products which needed to be shipped but could not. There was
a long pause in the process and delivery was delayed by several months.
The shipping management system was
also on the verge of collapse because there was just so much uncertainty and
safety regulations which needed to be considered before taking any decision.
Any and all backlog as a result of COVID failed to reach in time and the new
orders lined up for these shipping containers got delayed and postponed even
further. This led to extensive amounts of shipping containers to be either
stuck and not being able to move out or just caused delay for other shipping
orders. There was clearly a lack of containers but the demand for products did
not significantly decline. There was still a need to deliver on time and this
caused the shipping companies to increase their prices. As explained above
already, there was a huge demand and almost all of the businesses were looking
for alternate containers to ship their products in. The ones which they did
book, their prices were not low and hence, overall, the international shipping
costs drastically increased. The pandemic was a great and potentially one of
the biggest reasons why international shipping got so expensive for the
customers who shopped online through an international website.
4.
Long Process,
Many Steps
Shipping is definitely a lot of
work. It is not just about the responsibility and trust the clients place on
the shipping company but also about how there is an extensive process which
needs to be implemented in order to deliver on the right day and right time
without any repercussions. International shipping is expensive but it also
starts to make sense why when the whole process from placing an order to
delivering it is understood. For customers, it is very difficult to pay such
large shipping costs but if you consider the contextual situations along with
the global economic circumstances, it will start to come in place.
International shipping has a lot of steps and with completion of each step,
there is a cost involved.
For example, it needs to be picked
up from the ground location by the shipping company and then it needs to be
loaded in the appropriate mode of transportation. This can be either air, water
or road as mentioned above. After that, it would land to the country where it
needs to be delivered. This is not all. The product then keeps moving from one
place to the other until it reaches the doors of its owner. It is a long and
tedious process involving many entities that all charge a certain amount of
money. From the employees to the vehicles to their management, everything
requires money hence these shipping costs a culmination of all that in order to
ensure that the process runs smoothly and there are no unnecessary problems
along the way.
Conclusion:
This blog is definitely a great way
to inform yourselves of why exactly are you spending so much on the shipping
costs. There are a multitude of reasons, however, the reasons mentioned above
are amongst the most important ones because they completely define how the
shipping system works and helps you better understand why it needs so much
money to operate.
From COVID to consumer demand,
everything is explored in this very blog so if you have any confusion and doubt
towards a high spending on shipping, this will pretty much clear it up.
Shipping companies faced tremendous problems during the Pandemic and to recover
from the losses, all prices were increased. Shortage of shipping containers and
more demand of products needed to be shipped literally shaped the landscape for
a high price and since then, the prices have not gotten down. E-commerce also has a role in getting the
international shipping costs to where they are now but now we know. It is
always better to understand why we are spending so much on something and this
blog is a great overview and answer to that this question. It provides detailed
information on the whole conundrum and ensures that you are aware of each and
every detail regarding the expensive international shipping costs.
Meta
Description: This
blog is the answer to one of the most frequently asked question about shipping
costs and their price. It tells you everything that there is to know about why
international shipping costs are so expensive and how did it get to that. It is
a great reflection of all the major reasons for an increase in the
international shipping costs.
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