{"id":12776,"date":"2021-09-28T03:31:58","date_gmt":"2021-09-28T10:31:58","guid":{"rendered":"https:\/\/michaeljbrumm.com\/dcl-v3\/?p=12776"},"modified":"2024-03-27T08:58:51","modified_gmt":"2024-03-27T15:58:51","slug":"difference-between-ddu-and-ddp","status":"publish","type":"post","link":"https:\/\/michaeljbrumm.com\/dcl-v3\/blog\/shipping\/difference-between-ddu-and-ddp\/","title":{"rendered":"How to Decide Between Offering DDU or DDP"},"content":{"rendered":"<p><span style=\"font-weight: 400;\">When deciding to start shipping internationally, there are so many decisions to make. One of the biggest is how to resolve customs fees\u2014who pays for them and when they get paid. For sellers new to international markets it might be difficult to understand how to sort out which is right for them.\u00a0<\/span><\/p>\n<p><b>What\u2019s the Difference Between DDU and DDP?<\/b><\/p>\n<p><i><span style=\"font-weight: 400;\">DDU (Delivered Duty Unpaid)<\/span><\/i><span style=\"font-weight: 400;\">: The customer only pays for shipping at checkout. Any additional duties, taxes, or customs fees are paid once the package arrives at customs. Customers are expected to submit payment to the local post office where they pick up the package before the package is released from customs. Because of this, DDU often keeps shipments held up at customs. DDU shipping is more likely chosen for low value goods as duties don\u2019t kick in until the value of the goods exceeds a certain threshold which vary by country but are typically low.<\/span><\/p>\n<p><i><span style=\"font-weight: 400;\">DDP (Delivered Duty Paid)<\/span><\/i><span style=\"font-weight: 400;\">: The customer pays for shipping and any duties, taxes, or customs fees at checkout. Costs may seem higher because they are all upfront. Paying before the shipment gets through customs ensures there are no hold ups or delayed packages. DDP shipping is increasingly in favor for many ecommerce sellers around the world.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Neither is cheaper across the board, the biggest difference between paying all fees upfront or paying shipping and customs fees separately.\u00a0<\/span><\/p>\n<p><b>What Happens at Customs<\/b><\/p>\n<p><span style=\"font-weight: 400;\">Have you ever had a package you\u2019ve purchased get stuck at customs? It\u2019s not something everyone has personally dealt with, and it\u2019s good for sellers to understand what it&#8217;s like for a consumer to have to go and pick it up.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Shipments go through a few steps at each customs clearance (in the origin country and destination country) before being released. If your documentation is incomplete or unclear your products will be held up at any one of these stops:<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Origin country scans. Before getting on a boat or plane, a shipment leaving the US will need to pass through US customs. An agent will check to ensure you\u2019re not shipping any contraband.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Commercial Invoice. To get through US customs smoothly, it\u2019s imperative that the listed contents on your documentation clearly match what\u2019s being exported. Agents will also use the information on your commercial invoice to relay any specifics to the destination country (like tax liability).<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Travel. After your shipment passes through US customs, it will board a plane or ship and be transported to it\u2019s next stop.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Destination country scans. Your shipment will go through a very similar process in the foreign customs office as it did when it left the origin country. Make sure your documentation for the destination country is correct\u2014every country has different rules and regulations.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Duties and tax determination. After checking your shipment meets all of the import country\u2019s regulations, a customs agent will determine the customs fees that are due.\u00a0\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Additional needs. Every country has specific rules that sellers need to know before shipping there; Canada, for example, requires US sellers to set up a non-resident importer (NRI) and provide a specific Canadian commercial invoice (CCI).\u00a0<\/span><\/li>\n<\/ul>\n<p><b>How to Choose DDP v DDU<\/b><span style=\"font-weight: 400;\">\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Either option is acceptable as long as you communicate clearly with your customers exactly what they should expect: will they need to pick their package up at customs? Are there extra fees they\u2019ll be responsible for after the checkout process? You want to give your customers the smoothest experience possible, so making it clear what they are responsible for is the best case scenario when choosing between DDP and DDU.\u00a0<\/span><\/p>\n<p><i><span style=\"font-weight: 400;\">Is DDP More Expensive?<\/span><\/i><\/p>\n<p><span style=\"font-weight: 400;\">Because DDP is all costs paid upfront, it appears to be more expensive in the checkout process. For some customers this might deter them from completing the checkout process; this is especially so if their total cart balance is lower than the shipping and customs fees. Sellers can choose to pay for some or all of the duties and taxes to help encourage the buyer to buy from them. For low cost items, the difference between $10 and $50 for overall shipping and customs is significant. The actual customs fees total will vary depending on the product and agreements between the origin country and destination country.\u00a0\u00a0<\/span><\/p>\n<p><i><span style=\"font-weight: 400;\">Does DDU Lower Cart Abandonment?<\/span><\/i><span style=\"font-weight: 400;\">\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">DDU might seem like a better option if you want cart conversions. Having a lower cost at checkout might cycle more customers through the purchase process. The drawback is if those customers have any subsequent issues. Customers aren\u2019t going to come back to make more purchases if their package gets stuck at customs, or they have to go pick it up. Plus they\u2019ll likely lose interest in your brand if they end up with surprise fees.\u00a0<\/span><\/p>\n<p><b>Benefits of Working with International Shipping Experts<\/b><\/p>\n<p><span style=\"font-weight: 400;\">There are many variables to consider when choosing DDU versus DDP. It\u2019s best to work with international shipping experts who can help get you set up for a smooth customs experience. At DCL Logistics we work with high-growth brands looking to scale their business. For example, one of our <\/span><a href=\"https:\/\/michaeljbrumm.com\/dcl-v3\/blog\/press-releases\/passport-shipping-launch\/\"><span style=\"font-weight: 400;\">international shipping partners<\/span><\/a><span style=\"font-weight: 400;\">, Passport, seamlessly integrates with DCL\u2019s dedication to customer-centric fulfillment. Through <\/span><a href=\"https:\/\/passportshipping.com\/\"><span style=\"font-weight: 400;\">Passport<\/span><\/a><span style=\"font-weight: 400;\"> sellers get:\u00a0<\/span><\/p>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Turnkey DDP Solution. No more held packages or surprise fees; sellers can charge and collect duty and tax fees at checkout to deliver a seamless delivery experience.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">End-to-end Tracking. Sellers have access to a branded tracking page with accurate delivery dates, precise pickup locations, and direct integration with last mile carriers.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">High-touch Customer Support. Passport will handle the day-to-day international shipping questions and support to enable sellers to focus on growing their global footprint.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">One Simple Rate. Best in class parcel shipping, DDP calculator, customer support, and international customs expertise are all included in one flat rate.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Compliance Solutions. UK and EU VAT compliance service makes Passport the merchant of record for ongoing compliance. Fully integrated HS code compliance. Regulatory compliance navigation for food, cosmetics, supplements, and other sensitive industries.<\/span><\/li>\n<\/ul>\n<p><span style=\"font-weight: 400;\">If you\u2019re looking to get into new markets abroad, <\/span><a href=\"https:\/\/michaeljbrumm.com\/dcl-v3\/company\/get-started\/\"><span style=\"font-weight: 400;\">reach out for a quote<\/span><\/a><span style=\"font-weight: 400;\">. Together with Passport we\u2019d love to support your international business. Our teams will help make the process smooth for you and a great experience for your customers. <\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>When deciding to start shipping internationally, there are so many decisions to make. One of the biggest is how to resolve customs fees\u2014who pays for them and when they get paid. For sellers new to international markets it might be difficult to understand how to sort out which is right for them.\u00a0 What\u2019s the Difference [&hellip;]<\/p>\n","protected":false},"author":11,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"content-type":"","footnotes":""},"categories":[95],"tags":[2054],"class_list":["post-12776","post","type-post","status-publish","format-standard","hentry","category-shipping","tag-international"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v22.5 (Yoast SEO v26.9) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>How to Decide Between Offering DDU or DDP | DCL Logistics<\/title>\n<meta name=\"description\" content=\"When shipping internationally who pays for your customs fees\u2014you or your customer? 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