What is international logistics?

International logistics refers to managing and coordinating

the shipping, transportation, and distribution of goods across global markets. In
the context of e-commerce, it plays a crucial role in facilitating cross-border
trade and ensuring that products reach customers worldwide. According to
a DHL whitepaper, renewed economic growth in ASEAN countries will give
rise to a demand for cross-border road transportation as trade recovers.
Intra-Asia trade is set to receive a series of boosts from new trade agreements
and facilitating regulations in the months and years ahead. Cross-border
trucking in Southeast Asia continues to grow, driven by e-commerce consumer
spending and the door-to-door logistics solutions consumers and businesses
demand.

The significance of international logistics in e-commerce cannot be overstated.

It encompasses a range of activities, including inventory management, order
fulfillment, transportation planning, customs clearance, and last-mile delivery.
Businesses can overcome the complexities and challenges associated with
global trade by effectively managing these processes.

What is the role of logistics strategies in International Shipping?

Logistics strategies are instrumental in streamlining cross-border shipping. They

involve careful planning, optimisation of routes, selection of appropriate
transportation modes (such as air, sea, or land), and efficient coordination
with outsourced logistics partners and carriers. These strategies aim to minimise
costs, reduce transit times, and ensure the safe and timely delivery of products
to customers around the world.

In the competitive e-commerce landscape, having robust international logistics

capabilities gives businesses a competitive edge. For e-commerce businesses, it
enables them to improve communication, transparency in the supply chain,
improved customer satisfaction, distribution and logistics optimisation, cost
reduction, improvement in efficiency and on-time delivery. By understanding
and implementing effective international logistics strategies, e-commerce
businesses can navigate the complexities of global trade and capitalise on the
opportunities it presents.

Key Components of International Logistics

International logistics involves essential components that businesses must
understand to expand globally. These components include supply chain
networks, handling of goods, modes of transportation, the goods transportation
process, and customs and import duties. Mastering these aspects is crucial for
managing international logistics operations effectively.

Supply Chain Network

Establishing a global supply chain is crucial for successful international

logistics. It allows businesses to source, produce, and distribute their products
globally efficiently. By establishing strategic partnerships with e-commerce
suppliers, manufacturers, and distributors worldwide, businesses can ensure a
steady supply of goods and optimise their operations.

Several considerations come into play for direct-to-customer (DTC) brands

entering international markets. These include understanding local consumer
preferences, adapting product offerings, complying with regulations, and
establishing reliable shipping and fulfillment networks. Building a strong brand
presence and providing a seamless customer experience is essential for DTC
brands to thrive in international markets.

Handling of Goods

When it comes to international orders, evaluating physical distribution and

warehousing options is crucial. Businesses need to assess factors such as
proximity to target markets, transportation infrastructure, storage capacity, and
fulfillment capabilities. Utilising fulfillment centres in target countries offers
several benefits, including reduced shipping costs, faster delivery times,
and localised inventory and fulfillment management.

Modes of Transportation

Choosing the appropriate mode of transportation is a critical decision in

international logistics. Air, sea, and ground shipping each have their advantages
and considerations. Air freight offers speed and reliability, making it suitable for
time-sensitive shipments. Sea freight is cost-effective for large volumes but has
longer transit times. Ground transportation provides flexibility and accessibility
for local distribution. Selecting the most cost-effective and reliable
transportation mode depends on factors such as shipment size, urgency,
destination, and budget.
Goods Transportation Process

Understanding the journey of goods from the seller to the end consumer is
essential in international logistics. It involves various stages: order
processing, packaging, labelling, documentation, customs clearance, and
last-mile delivery. Each stage presents unique challenges, such as navigating
customs regulations, coordinating with multiple stakeholders, and managing
potential delays. Businesses must address these complexities and communicate
transparently with customers about varying delivery times and expectations.

Customs and Import Duties

Cross-border trade entails additional costs and paperwork, primarily related to

customs and import duties. Businesses must understand the regulations and
requirements of target markets to ensure compliance and avoid delays or
penalties. Shippers are responsible for accurately declaring goods, providing
necessary documentation, and paying applicable import duties or taxes.
Informing customers about potential fees in advance helps avoid surprises and
ensures a smooth delivery process.

By understanding and effectively managing these key components of

international logistics, businesses can optimise their operations, enhance
customer satisfaction, and successfully navigate the global marketplace.

Benefits of International Logistics for E-commerce Stores

International logistics brings several advantages to e-commerce stores,

providing them with a competitive edge and opportunities for market expansion.
Here are the key benefits:

Competitive Advantages
International logistics provides e-commerce stores with competitive advantages
contributing to their success in global markets.

1. Lower manufacturing costs and competitive pricing: By leveraging

international logistics, businesses can access lower manufacturing
costs in different regions, allowing them to offer competitive pricing to
customers worldwide.
 2. Expanding product ranges and reaching new customer
segments: International logistics enables e-commerce stores to
develop their product ranges and explore new market segments. With
efficient shipping and fulfillment processes, businesses can cater to a
diverse customer base, increasing their sales potential.

Here is how to start an export business? What are the initial steps that
should be taken?

First and foremost, you must know how to set up the export business in India,
and then we shall proceed with the process. To ensure the safe and legal export
of goods, the export business must follow a simple process. The procedure for
starting an export business, according to government guidelines, is as follows:

Step 1: You must have a valid business operation- Next, as mandated by the
government, you must open a bank account in any authorized bank in India. It is
necessary to open a current account with a bank authorized to deal in foreign
exchange.

To begin an export business, a sole proprietorship/partnership firm/company

must be established according to the procedure, with an appealing name and
logo.

Step 2: Obtaining a Permanent Account Number (PAN) - Every exporter

and importer must obtain a PAN from the internal revenue service. The
businesses and bank account holders have it already.

Step 3: Obtaining an IEC (Importer-Exporter Code) Number - It is

mandatory to obtain an IEC for export/import from India, according to the
Foreign Trade Policy.

According to ANF 2A, an application for IEC is filed online at DFGT, and an
application fee of Rs 500/- is paid online via net banking or credit/debit card,
along with the required documents listed in the application form.

Step 4: Registration and membership certificate (RCMC) - Exporters must

obtain an RCMC from the Export Promotion Council to obtain authorization for
export. They can also look for any other benefit or concession under FTP
2015-20 and receive services/guidance.

After completing the four steps above, you can look forward to how to export
from India. However, it is better that you must know about the pricing details
and related processes.

Step 5: Pricing and Sampling - Providing customized samples to meet the

needs of foreign buyers aids in the acquisition of export orders. Exports of bona
fide trade and technical representatives of freely exportable items are allowed
without restriction under the FTP 2015-2020.

The price should be calculated based on the terms of sale, such as Free on Board
(FOB), Cost, Insurance, and Freight (CIF), Cost and Freight (C&F), and so on;
the businesses must take into account all expenses from sampling to realization
of export proceeds. Also, the export cost should be fixed at a competitive price
with a good profit margin.

Tip: It's good to make an export costing sheet for each export product.

Know about the payment risks

Payment risks will persist in international trade due to geographical barriers and
insolvency issues on the side of the buyer/country. To mitigate these risks, there
are few options, and one of the most solid options is to obtain an Export Credit
Guarantee Corporation Ltd policy (ECGC).

When a buyer places an order without paying in advance or opening a letter of

credit, it's good to get a credit limit from the ECGC for the foreign buyer.

The six steps outlined above are required to begin an export and must be
completed in their entirety to ensure that all licenses, permissions, and security
measures are in place.

Now that you know how to begin the process, here is the next phase of your
export process. You will find the following section about the information
related to how to export from India:

Step 1:

Export Order Confirmation

Firstly, when you have received the confirmation, make sure the Order
requirements should be carefully noted upon receipt of an export order.

Step 2:
Next, check and secure the supplemental information related to the Ordered
item, specifications, payment terms, and delivery date.

To avoid the risk of consignment rejection in the future, the exporter can enter
into a formal agreement with the overseas buyer.

Step 3: Investing
Labelling, packaging, packing, and marking are the third and final steps.

Step 4: Export Goods Shipment Insurance

You must purchase a marine insurance policy to protect your export goods.

Step 5: Set a Dispatch Date

If the delivery is late, your efforts may be futile. As a result, the most important
thing is that the export order is delivered on time to the buyer's port. After
receiving the order, you must contact CHA to confirm the number of days the
shipment will take to arrive at the destination port. As a result, you'll need to
plan and get the package ready for delivery.

Step 6:
To reserve the required space on the vessel for shipment, the exporter must
contact the shipping company well in advance.

Internal transportation from the factory/warehouse to the shipping portals must

be organized to avoid loss or damage during transit. CIF agreements are
typically insured by exporters, whereas C&F and FOB agreements generally are
insured by importers.

Step 7:
The following mandatory documents for import and export are outlined in the
Documentation of Export Goods FTP 2015-2020.

Commercial invoice cum packing invoice shipping bill/ invoice of export/

invoice of entry Bill of Lading/ Airway Bill Commercial invoice cum packing
invoice shipping bill/ invoice of export/ invoice of access (for imports).

Note: Other documents, such as a certificate of origin or an inspection

certificate, may be required depending on the circumstances.

Submitting documents to the bank

Following shipment, the documents must be presented to the bank within 21
days for forwarding to the foreign bank for payment arrangements.

With these steps mentioned above, you will have every crucial information
related to how to export from India.

If you are someone fresh in the export landscape, you can also consider an
agency to have your back. Still, since the invention of accessible platforms, the
complex export processes have been simplified, and now the businesses have
broader horizons to reach international customers!