Data Integrity in eCommerce: The Importance of Labelling and Data Accuracy in Cross-Border Shipping

Benedict Leong

Data Integrity in eCommerce: The Importance of Labelling and Data Accuracy in Cross-Border Shipping

This is the first part of a series in data integrity in the eCommerce ecosystem.

When running an eCommerce business, data integrity is central to the smooth operations of the eCommerce ecosystem. From handling multiple merchant portals, to warehouse storage and the fulfilment process, to even payment gateways, having data that is accurate and consistent will help ensure that every element of the eCommerce supply chain is accounted for. These include the likes of:

  • keeping track of inventory
  • eCommerce order fulfilment
  • B2C cross-border shipping
  • B2B bulk shipping
  • channel management

 

This is especially so when making business-to-consumer (B2C) cross-border deliveries, as accurate labelling can help you make sure that your shipments reach the correct customers in a timely manner.

Regardless of whether you’re shipping on your own or with a logistics service provider (LSP),

the accuracy and sufficiency of the data you provide will actually determine whether or not your parcels can even complete their delivery journey.

For instance, inaccurate or incomplete data can lead to your parcels being denied entry into a country at customs. This can occur if customs officers cannot confirm where your parcel is heading to. Similar to getting your customers’ orders mixed up, an item that has failed to deliver will sour the eCommerce experience for your shoppers.

Hence, it’d be helpful to always make sure that your preparation for the first mile delivery of your goods is sufficient. By adhering to some simple guidelines, you’ll be able to get the hang of delivering your goods overseas smoothly.

Before we go on about the importance of data accuracy and proper labelling, let’s find out briefly what exactly is in a shipping label.

What data is needed in a cross-border shipping label?

 

When shipping cross-border, most shipments will require a main shipping label as well as a commercial invoice to clear customs. For most products and destinations, the main shipping label would at least have the following information:

  • Recipient’s name and address
  • Sender’s name and address
  • Item description
  • Item weight
  • Item quantity
  • Tracking number and/or barcode

 

These pieces of information are vital for your logistics service providers and customs officers who need to know where and who the package goes to, and in some cases how to handle it in the case of fragile or specialised products.

This especially applies if you’re shipping to an individual person and not a company. Addressing your end-consumer with their personal name on the label rather than their company name could help you save costs if you’re shipping in small amounts, as B2C shipments tend to be taxed at a lower rate than business-to-business (B2B) shipments. On top of that, B2B shipments also require more documents and licenses to clear customs, so it would be easier for you to make B2C deliveries by addressing your customer’s personal name.

Additionally, aside from the main shipping label, commercial invoices are also needed for your cross-border deliveries to clear customs. Commercial invoices tend to contain more detailed information compared to the shipping label and will help in preventing your parcels from getting stuck in your destination country’s customs.

 

Commercial invoices should at least contain the following information:

  • The declared value of the shipment and its currency
  • Full descriptions of each item in the shipment. You can check how to fill this in with your service provider
  • The consignee (recipient’s) name, phone number and address
  • Waybill Number
  • Shipper (sender’s) name and address
  • Shipping terms which mention if the shipper or the receiver is paying for delivery

 

Additional information that may be needed depending on whether it’s a B2B or a B2C shipment and also where you’re shipping to:

  • Harmonised Code – a special code used by the World Customs Organisation to classify goods
  • Tax registration number (e.g. VAT number)

The information on commercial invoices will help to ensure your items are classified correctly, which is also important when looking at import taxes and duties which may vary by the type of items in certain countries.

Now that we know what’s needed in cross-border shipping labels, let’s look at what could happen if the data on shipping labels are printed incorrectly.

What happens when the data on your shipping labels are inaccurate?

Regardless of who you’re shipping with or where you’re shipping to, inaccurate data will cause problems at most steps of the delivery process.

At the first-mile delivery stage, inaccurate data may not be noticed by both the merchant and the LSP. However, when transporting these goods to the airport, your LSP may begin to face difficulties if the destination address is wrong or not properly stated. This is because the shipments need to be split into the countries and provinces they are headed to so that they can be brought onto the correct plane for line haul.

Customs Issues

Even if the shipments with inaccurate data happen to make it through to their destination country, they may face serious problems at the customs clearance stage. Customs officers can hold or even confiscate your goods if they deem that there is insufficient accurate information to allow your shipments to enter the country.

Common inaccuracies include inaccurate statements about the type of goods your shipments contain or its value, or incorrect delivery addresses. While these details may seem minute, incorrect labels can cause a failed delivery if your shipments cannot clear customs at all. Even in an optimistic scenario, slow customs clearance may still lead to delayed distribution for last mile delivery.

Failing to clear customs due to inaccurate paperwork may lead to increased costs when you’re charged more by your LSP because of the extra effort made in handling your goods in order to clear customs. As an example, the additional effort can come in the form of them having to reprint your shipment’s label if it’s incorrect.

Potentially Higher Taxes & Increased Costs

Additionally, inaccurate data on the type of goods in the shipments may cause import duties and taxes to be inaccurate as well. For instance, coffee beans and coffee powder have different tax rates in Malaysia, and writing their descriptions inaccurately could cost you more than necessary.

You may also need to pay the return cost of your parcel to get it back if the parcel cannot clear customs. Fraudulent orders that may not have been filtered out during data checking could also lead to revenue loss, time wasted, and additional cost for delivery returns.

Wrong Destination

Furthermore, even if your shipments have managed to clear customs and enter the destination country for distribution, your LSPs may still have a hard time trying to sort them for last mile delivery. As an example, if a street name is misspelled, one might have to question where exactly the parcel should go.

Repeat delivery attempts may be needed if the address turns out to be wrong the first time. However, the process of trying to clear up the address with the end-consumer and not getting it right the first time could be inefficient and not leave a great impression with your customers.

As a whole, the total cost of inaccurate data and labelling include time lost, a tarnished reputation, and customer service costs. Therefore, it is undoubtedly very important for your data to be accurately entered on shipping labels if you’re looking to have a fuss-free B2C delivery journey.

How can you ensure data accuracy on your end? Who can you work with?

Even though it may appear as though there are numerous consequences for inaccurate data and labelling, your shipments can still be safely delivered with a few best practices we recommend.

If you key in shipment information directly into your logistics service provider’s online portal it makes things easier for you to ensure that all details are correctly and completely filled up. This is especially so when filling up the name and address portions of the label because it determines where the parcel ends up. There are also shipping partners who make use of data validation or drop down lists that filter to the destinations you’re targeting which could make your life a little easier.

In addition, phone numbers and zip codes are also valuable data in last mile deliveries, so it’s crucial to make sure that they are keyed in correctly before the supply chain process begins.

Be sure to key in the information with a recognisable language on your LSP’s system. For instance, special characters in some languages may not be able to be read by some systems. This is to prevent either an immediate rejection by the system, or a rejection after the delivery has already gone through several stages in the process.

If you’re a merchant making use of your own data-collection system, it would be helpful to have someone dedicated to managing order fulfilment to ensure that the orders are sorted correctly if the process is not automated. This can be done by inputting the client’s shipment information into the shipping partner’s software in a systematic manner to minimise problems having to do with wrong destinations, wrong goods, or unrealistic estimated delivery dates that consumers see on their end.

For instance, some marketplaces already have data validation in the entry fields for customers to fill in their details. Through the use of drop-down boxes that reduce human error, inaccuracy in the data collection process can be minimised.

If you’re a small business and managing logistics service providers yourself, set aside some time in the day where you’re just doing fulfilment. Try to double-check the accuracy of the information you’ve provided and make changes before you send them in, as changes to the label after initial shipping are very difficult to amend.

If you’re a merchant making use of a larger eCommerce marketplace to list your goods, it may be good to look through the type of data the marketplace collects and how it is collected from your consumers. If the data collected is insufficient like an inaccurate province name or postal code, a good stop gap would be to reach out to your customer via email to get their full address before shipping your product off to them. However, this is only effective if you have small order volumes.

In such cases, it’d be good to send your feedback to the eCommerce marketplaces requesting for changes in the data-collection system. This would ultimately benefit all parties involved when parcels reach consumers faster, leaving a better review for both merchants and the eCommerce marketplace.

 

Labelling and data accuracy may appear as small parts of the international delivery procedure, but they’re significant enough to see through your parcel’s successful delivery. By ensuring that your labels always contain sufficient and accurate information, you can almost guarantee a smooth journey for your shipments.

 

Southeast Asia is home to pretty varied customs requirements for parcels. Find out these differences and clear Southeast Asian parcel customs with our downloadable SEA custom clearance guide!
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