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Episode 110 joe newbold podcast cover

Hosted by Richard Hill

Ep 110:
Joe Newbold:
Cut Down on Your Shipping Expenses While Navigating The European Market. What's Next in The World of Shipping

More orders must be better for a company than less of them? You would think so. It is, until the customers start trotting on down to Royal Mail, slapping that return label on and sending them back. 

Packaging and shipping costs can become wildly out of hand, for both the business and the environment. So, eCommerce businesses need to be ahead of the game. 

They must deliver a seamless experience for their customers to reduce the risk of receiving that return to save the environment and the CEOs/Founders wallet. 

Tune in as Joe from Sendcloud shares how! 

eCom@One Presents:

Joe Newbold

Joe Newbold is the Team Lead Enterprise at Sendcloud, Europe’s number 1 shipping platform that supports 25,000 merchants to deliver a seamless shopping experience for their customers. Sendcloud works with thousands of retailers to make national and international delivery so much easier.

In this episode, Joe talks about his experience working in Shanghai and what it taught him about their amazing culture. He discloses the ever-growing opportunities in the European market, the current challenges retailers face when selling internationally and how to overcome them.

He shares his views on the large costs for shipping and returns that a business can face and the impacts of this on our environment. With an expanding global concern for sustainability, are our online shopping habits hindering the progress on this issue? 

Listen to find out how to avoid high shipping costs, improve the return experience and overcome  issues with custom fees. Joe gives us his secret tips to reaching your business goals and where he sees the world of eCommerce in 12 months time.

You don’t want to miss this one! 

Topics Covered:

1:46 – How he ended up in the world of eCommerce

5:38 – Gaining experience from working abroad

6:47 – Opportunities for UK businesses in the European market

15:02 – How can an eCommerce store avoid high shipping costs

17:47 – Thoughts on next-day delivery one-off fees, and the environmental impacts of such schemes

21:33 – The Returns Crisis

25:48 – Dealing with customs issues at the borders

29:46 – Joe’s Secret Tips to help your business

34:07 – What’s up next in the next 12 months

35:31 – Joe’s Book Recommendation

36:33 – Where can you find out more about Joe and his work

Richard Hill:
Hi there, I'm Richard Hill, the host of eCom@One. Welcome to episode 110. In this episode, I speak with Joe Newbold, team lead enterprise at Sendcloud. Joe and the team at Sendcloud work with thousands of merchants, taking the pain out of local and international delivery, utilizing over 80 couriers worldwide while connecting seamlessly with over 50 plus well known integrations like BigCommerce, Shopify, Magento, Woo and dozens more. Joe and myself cover what opportunities there are in the European market for eCommerce businesses, what challenges online retailers face when selling internationally and how to overcome them, how can an eCommerce company avoid high shipping costs, how can businesses overcome the issue with potential custom fees, and Joe and myself talk all things returns and how to improve the returns experience. Finally, we get Joe's thoughts on what's next in the world of shipping.

Richard Hill:
If you enjoy this episode, hit the subscribe or follow button wherever you're listening to this podcast. You're always the first to know when a new episode is released. Now let's head over to this fantastic episode. This episode is brought to you by eCom One, eCommerce marketing agency. eCom One works purely with eCommerce stores, scaling their Google shopping, SEO, Google search, and Facebook ads through a proven performance driven approach. Go to ecomone.com/resources for a host of amazing resources to grow your paid and organic channels. Hi, and welcome to another episode of eCom @ One. Today's guest, Joe Newbold, team lead enterprise at Sendcloud. How you doing Joe?

Joe Newbold:
Hey, yeah, really good. Thanks. Thanks for having me on.

Richard Hill:
No problem at all. Now me and Joe met about two months ago at the RX in Birmingham, in the UK, and I thought, right, we've got to get Joe on the podcast and have a good chat all things delivery, international delivery. So I think it'd be good for you, Joe, to introduce yourself and tell the listeners how you ended up in the world of eCommerce.

Joe Newbold:
Yeah, sure. Well, thanks again for having me on, Richard. It's good to be here speaking to your guests. So yeah, my name's Joe. I'm one of the team leads in the enterprise space at Sendcloud. Sendcloud is Europe's number one shifting platform. So we support 25,000 merchants and we help them to optimize all things to do with shipping, whether that's operational efficiencies or providing more branded experiences for consumers. In terms of how I got into eCom, yeah, I always enjoy listening to this question. It's quite interesting, because a lot of people have very different ways of getting into eCommerce. Myself, I did the classic thing so I finished university and went off traveling for a couple of years. So I studied maths at university. So I did actually an internship for an investment bank in Shanghai first, which was interesting and then moved over to Australia for 18 months. A whole host of different jobs, but it was more just to earn enough money to pay for the beers rather than more career focused type of work.

Joe Newbold:
And then when I got back from Australia, I had to get my head in into gear and figure out what I wanted to do. So I applied for a whole host of different roles and ended up at DHL Supply Chain, which was actually quite a, yeah, a fortunate turn of events, really, for me to work for them because it's such a vast organization with so many different avenues to explore. Ended up in their insurance division, I think, because of my maths background, so started off there. Then actually moved into the world of SAS within DHL. So we had our own startup incubator where we were building SAS products, trying them out with customers, just MVPs and trying to divest them, which was quite interesting. And then that led me into eCom, because we were doing a lot with eCommerce, merchants, retailers, et cetera, because they were the more innovative, shall we say, type of businesses that were willing to try things out.

Joe Newbold:
And then I just saw an opportunity. I was quite excited about eCommerce. It was a really brilliant industry. It was so many different fast growing sectors within it. So I switched over and moved into a business development role for DHR Supply Chain within their eCom team. So that was selling the full end to end solution, so everything you can imagine from the products coming in storage, dispatch, shipping, returns. So it was completely com... It was a real complex solution set, including all of the technology that pieces it all together. So was there for, yeah, two to three years and selling to some of the world's biggest retailers all over the world, which was, yeah, a great entry point into the world of eCom.

Joe Newbold:
And then from there I wanted to get into a bit more of a niche area. So that led me to carry management solution. So worked for Metapack for almost a couple of years and then eight months ago, joined the rocket ship, Sendcloud. Was approached and really like the story, how fast the business was growing. Just raised 150 million euros and I thought this is a great opportunity for me to join the company. Started off mainly focused on SMB and now we're moving up market into the enterprise space. So thought it was a good opportunity for me to bring my knowledge and experience to a fast growing company and, yeah, eight months in, enjoying it so far, but it feels like eight years maybe.

Richard Hill:
Yeah, very, very, very, very fast paced environment, very fast paced company. Obviously, we know you guys very well. We did a webinar with you guys and BigCommerce few weeks ago, and obviously we know a lot of the team there, do a lot of business with you guys and our clients. So... Oh, so quite a brilliant journey there. I always like to hear that and see where people started out. The whole university days and see if people actually go down the route of their university degree firstly, which is always an interesting one where most people don't, I think, is reality, which is quite a good message, I think, to those that are off to uni. My lad's in his final year, just about. Well, he'll be starting his final year at A-level and still obviously not sure what he wants to do and all that jazz and looking at doing a business and finance degree, but what will he end up doing? Who knows, eh?

Joe Newbold:
Yeah, exactly.

Richard Hill:
Yeah. Yeah.

Joe Newbold:
One bad experience.

Richard Hill:
So when you left uni you had some time abroad then, working in... Where did you say? Shanghai?

Joe Newbold:
Shanghai for... Yeah. Worked there on an internship for a few months, which was, yeah, amazing experience. The culture obviously, completely different to what I was used to in the UK. But just give me, yeah, good overview of how different cultures interact. The business culture is extremely different to how we operate in the UK. It's very formal compared to a bit more relaxed in the UK, but yeah, no, I loved it. And then, yeah, I went off to Australia after that.

Richard Hill:
That's what I always say to everybody, if you've got that opportunity to spend some time away abroad. I had a similar experience during my degree. I did a sandwich degree and in my third year, I got the opportunity to go to Singapore, not too far away, well, that side of the world, and that was just the best time ever. When I look back at my university days and that time, it's that time there and the things... What I learned there and the culture and that experience, what that did for me, I think, was just probably so much more than the degree itself. So yeah, I think definitely-

Joe Newbold:
Unfortunately didn't pick up too much Mandarin. It's a bit difficult.

Richard Hill:
Isn't it just? Isn't it just? Yeah. Yeah. Oh brilliant. So obviously being able to travel, working for various different companies has obviously now led you to Sendcloud and obviously Sendcloud, what would you say to the listeners? What are the opportunities available to our listeners in the European market for eCom stores that are selling on what internationally, want to sell internationally?

Joe Newbold:
Yeah. Yeah. Good question. I think that's one of the things that makes me most excited about Sendcloud because we are so well established within the European market that we can really support UK businesses to really tap into that. And in terms of the size of the market, yeah, it's a real growth market. It's currently... The value's around almost 300 billion. So a huge market. The UK obviously is a big proportion of that, but all the data suggests that it will grow to half a trillion by 2025. Has a huge opportunity in the next two to three years for a lot of online merchants to really tap into this more of a growth market, I would say. In terms of some of the countries, you could look at Spain and Italy, they only are around less than a quarter of the UK market in terms of size.

Joe Newbold:
So these are really low penetration emerging markets. And what I know about the UK is a much more mature market. We have a lot of best practices that you can adopt and really take over into the European market to really penetrate that and grow, not just within the UK, but try and take those countries that are more emergent to the next level and you can be part of that journey and really grow into it. One of the things that... Sorry to mention, which is something which brings up another challenge, but also an opportunity, is Brexit. I speak to, yeah, hundreds of merchants on a monthly basis. And a lot of the, should we say, fast grown, but not global businesses, have actually switched off selling into Europe at the moment. And the percentage of orders ranges from what I'm seeing between five and 20%.

Joe Newbold:
So they've switched it off just because of the complexities, the cost, the unknown, and the lack of knowledge and, I guess, industry experience to be able to switch it on and do it confidently because what they're saying is, yeah, if you can just switch it on, but you don't have the right carriers in place, you don't have the right customs documentation process in place, a negative experience is going to completely kill you off on that market anyway. So there's a lot of nervousness around switching the European markets back on. So that's where companies like Sendcloud can really help to provide that industry knowledge and experience to help you switch it back on. So you think about five to 20% of merchants not shipping to your... Five to 20% of their volume not being shipped into Europe. That is an opportunity for the more advanced players, shall we say, to be able to tap into that and service that need from the European market that we know is there but is not being served at the moment because it's been switched off.

Joe Newbold:
And the flip side of this as well is because a lot of retailers have just switched it off. That is making UK market such a more competitive space because they need to find that revenue from somewhere that they've switched off overnight. So yeah, it's a bit of a negative, but also a really big opportunity. If you can do it right and do it properly, then this is a growth market and also a way for you to get the upper hand, there's competition.

Richard Hill:
Yeah. I think we talk about this a lot, opportunity where when something changes, whether that's to do with Facebook ads, Google ads, shipping, it doesn't matter. People abandon, people panic. All that doesn't work anymore, which is what we're saying and if five to 20% of people are saying, "Oh, it's just too complicated now. Just can't be bothered. Oh, it's just too much paperwork." But obviously that creates an opportunity for those that are going to explore, look at working with companies like yourself that can take that pain away and embrace that and market that even more where the margins are probably that bit better, possibly, not always, where as you say, the UK market, cost of acquisition depending on the industry, is getting more challenging so that's where we go off into lifetime value and making sure that those experiences are amazing. And obviously delivery plays a big part in that as well. But when we look at the European markets then as a UK seller, firstly, is there any particular markets or any particular countries that you think... It's quite a difficult question, I think, because it depends on the products and things like that. But is there any particular markets that stand out for you for UK?

Joe Newbold:
Yeah. Just from what I'm seeing, this is just from the Sendcloud data and how we're seeing our merchants in terms of their growth and, yeah, volume increases is obviously the more mature markets like Germany and France, they're a bit more established, so there's room to grow, but not as much. The countries where I'm seeing the highest room for growth is in countries like Spain and Italy that are less mature. They have more, let's say, less mature kind of supply chains, less mature web shops. Everything to do with it is probably a few years behind where the UK is. That touches on my point, if you can apply the best practices that we know we have in the UK and adopt them, albeit not plug and play, because there are nuances that you need to be aware of when you are setting up in these markets, but they're the ones I see where there's the most potential. As I mentioned earlier, these markets are less than a quarter of the size of the UK. So if you can really nail it and do it well, they're only going to go in one direction. They're less competitive than the UK markets. I feel like these two countries are where there's the biggest opportunity, but as you say, it depends on product category, et cetera, whether or not there's actually a demand for whatever you're selling.

Richard Hill:
Yeah. I think it is, as you said, you're an eCom store listening to this, you're not shipping internationally, to set up and try a country or to... It's not that challenging, is it anymore?

Joe Newbold:
No.

Richard Hill:
Helps you with using your technology stack, et cetera, whereas if you're trying to negotiate everything separately, sort out different deals with half a dozen different companies, whether that's to do with returns, to do with all the customs, to do with the different rates for different post codes or whatever you want to call them, it's quite challenging trying to do all that separately, granted, but to do it with a one stop shop, i.e. you guys, obviously that makes things a lot easier, doesn't it?

Joe Newbold:
Yeah, exactly. And as I was saying, all the different nuances per markets, I always give these anecdotes where I'm speaking to UK merchant which everyone's quite surprised about and I was surprised about when I learned them. And we do a big consumer research report a few times a year surveying about seven, 8,000 consumers across the continent. And for example, in Italy, 80% of consumers want cash on delivery as an option.

Richard Hill:
Wow.

Joe Newbold:
Which is... Everyone's completely surprised by it because imagine you order something in the UK and you have to pay for it when it arrived, you'd just be very perplexed as to why that's happening. But stuff like that can really help you actually provide the right services and solutions that consumers want. And if 80% want it, if you're not offering it, then they'll probably go to one of your competitors who does offer it. So it really... Those kind of industry insights can really help you do it properly. And there's not a big cost associated with that. It's just more knowledge and experience.

Richard Hill:
Yeah. That's an interesting one, isn't it? I remember the COD back in the day.

Joe Newbold:
Yeah.

Richard Hill:
Well, it's check on delivery back in my days before the agency, had various stores and we had PC component business and it was to the trade and to retail, but the trade business was all, well, predominantly was COD. Wait for our 20 check per day or whatever it may be, but they were big, fairly big, 10 grand, 20 grand, 15 grand, five grand, whatever it may be. Yeah. I didn't realize that was the thing myself, to be honest.

Joe Newbold:
Yeah. And I have spoken, we've got obviously Italian colleagues and I think it's more of a trust issue with actual online stores. Am I actually buying someone that exists or am I being scammed? The infrastructure's not in place to eradicate that. So that's where it's at. Yeah. So, I mean, again, this shows how far behind these emerging markets are compared to the UK, which gives you that opportunity.

Richard Hill:
That just screams opportunity to me, to our listeners. A lot of people will be scared or afraid, unknown, but working with a partner like yourself to bridge all those gaps to work through all that, I think that's a big opportunity. So where should we go next? So I think shipping costs are usually the thing that can put a lot of people off. You go to different stores, different stores try different... whether that's free delivery X, Y, Z, but how can an eCommerce store avoid high shipping costs? Is there any specifics there that you can... Tips you can give our guys?

Joe Newbold:
Yeah, it's a good question. And that's probably the million dollar question that everybody wants to know the answer to. And it obviously depends a lot on what type of products you're shipping, what markets you're shipping to and, yeah, volumes, et cetera. What we tend to see is within the UK specifically, 70% of consumers are willing to add an extra item to their basket if they will get free delivery based on it. So that's sort of things you can do. It's not helping to reduce the cost of shipping, but if you can increase their basket value, that gets rid of some of the associated costs. One thing I always suggest when UK merchants are looking to ship into Europe, depending on the size and scale, is you can work with partners. And we have lots of partners in our network that will consolidate.

Joe Newbold:
If you want to cover the whole of Europe, for example, you can consolidate all of your orders to each of those countries onto Palletised or Full Trailer, whatever it is, and they'll come and collect it in one order, do the customs clearance as one transaction so it's much more seamless, much quicker. And then they will take on the responsibility of injecting it into the relevant countries of their carrier hubs. So that way you get more economies of scale using one provider to do all of it. The cross border's done. Customs is done. It's much more seamless and you get a benefit on the cost savings of the shipment. So that is something, no matter how big or small you are, you can tap into with these type of providers. And I'm seeing a lot more of them pop up in the market. And that shouts to me that there's a lot of demand there for all of these companies to really start being able to be successful.

Joe Newbold:
Another area where, depends on the size of the company, but you can potentially start to look at fulfillment parties that could help you as well and we work with, again, lots of firmer companies in our network that we would advise some of our merchants to maybe start having those conversations with. So maybe some of your faster moving skews, you can put them closer to the end consumer, spread them out over Northern Europe, Southern Europe, in the States, wherever it may be. And then you have the product closer to the end consumer, which gives you two benefits, shorter lead times and shorter delivery costs. They're all the type of things you need to balance out and calculate and explore. But that's what I would suggest for most merchants, Ebra Consolidator or our fulfillment company will help to keep those costs down.

Richard Hill:
Yeah, that's brilliant. That's brilliant. I think that goes back to you may be thinking, initially, if you're not already, shipping into certain countries, but when you get to potentially certain room rates, maybe in certain volumes, then you can start thinking about the fulfillment, the bulk quarters, that type of thing and obviously there's going to be a saving, but also there's a commitment. So it's weighing up that balance between the two, isn't it? Now I've noticed quite... Seems to be more and more firms doing a one off fee to get free next day delivery permanently, a bit like an Amazon Prime, where you pay for your Prime, don't you, which is... I don't know how much it is nowadays, 55 quid. Obviously you get quite a lot of other benefits, like your video and whatnot. But I see... We've got quite a few clients now doing that, where you pay a one off fee to join the free next day delivery sort of club. What your thoughts on that?

Joe Newbold:
Yeah. And this is exactly it. It's the Amazon effect, isn't it? This is what they're setting the standards. And everybody's following to make sure that they don't lose market share. I think I get caught between two theories on this. The first one is that obviously the over consumption environmental impact, and often things like this, because I have used it with some of the biggest retailers you can imagine. If you paid £9.99 for a year, you're just... You need a pair of socks or something, you'll just order them the next day and you don't have to pay for delivery. So going back to my DHL Supply Chain days and knowing the cost of them, the transporting it in, the fulfillment, the pick, the pack, the shipping, next day services obviously come at a premium cost. And then if you consider the return cost as well, if you are talking about fashion industry, maybe up to 30% of items being returned.

Joe Newbold:
So there's that whole, does the cost, that benefit analysis, really work out for this? I know if you are a big retailer, you have high volumes, maybe it does. I'm not... Never been on the retailer side so I don't know how this pays back, but on the environmental side, is this the right thing we should be doing? That's the question, but then, yeah, the flip side of that, as I've just said, for me personally, when I had those subscriptions, I would shop a lot more and I would buy more. So there's... It's, yeah, depends where you sit.

Richard Hill:
Yeah, it's a great, great point, isn't it? The environmental piece, something that's big part of our business now and big part of my... I had to have a word with myself in the new year because we're looking at the Amazon orders for last year for the business. And me personally, I've got two accounts, obviously just log in dead quick and see, and I think it was 305 orders last year from Amazon. And you say that out loud, it is quite embarrassing.

Joe Newbold:
Yeah. Almost one a day.

Richard Hill:
Yeah. Pretty much, one a day. Pretty much one a day. And then we look at the blue bin or now purple bin here in the UK, well it is where I am, overloaded every week with that packaging piece and that environmental piece. So we very much made a point in January, several months ago now, right, that's it, we can't continue like this. It's just ridiculous. Yeah. We want things quick, but do we really need those things? I found we were just buying more things than we actually really need in reality, like you said a little bit, but so then we said, right, we only order now on a Monday so the orders now in our business and personally have gone down and it's not even like now we order every week because now it's like, you're thinking more about what you need and do you really, really, really need it? You've got three, four, five days to think about it. Everybody knows in the business, we won't order anything unless it's a Monday. Sounds a bit ridiculous, but...

Joe Newbold:
Yeah.

Richard Hill:
And then so the cost saving to the business, great. But more so I think, and so that environmental piece where we're not filling a skip every month with cardboard and whatnot, which... It's just crazy, it really is.

Joe Newbold:
Yeah, yeah, exactly that and I think, yeah, it's the balance, isn't it? How can you do it effectively and efficiently, but also keep those sales going up and I think it's... Yeah. It's difficult to balance. I think it depends on the business and their demographics, ect.

Richard Hill:
Yeah. I think you see some firms that put messaging in their checkout process when you're choosing delivery. So do you really need it next day? Do you really, really need it? Yeah, we can do that, but we do have a Tuesday or Wednesday or a Thursday, obviously, which is more of a potential cost saving, make you think about it a little bit more. So couple things then, and we touched on them a little bit, but returns. I think this seems to be, or quite a... oh, I was going to say the word pandemic then. I probably shouldn't use that word. Pandemic of people over-ordering, especially in apparel and clothing and that type of thing, where people are maybe ordering different quantities, a small or medium of something just to try it on and then potentially then send one back. What would you say about that... Almost like a returns crisis, I think. It's a bit of a strong word, but what would you say about that?

Joe Newbold:
Yeah, it's a good one. I think it links in quite nicely to the previous question around environmental impact, the over consumption. And again, it obviously differs massively per sector, so you're not going to return your washing machine as much you do a pair of trainers or going out clothes. But yeah, generally what we're seeing is more a just first of all, on the cost basis, returns are generally twice as expensive as the outbound. So that in itself says a lot about where we are in terms of the efficiencies of returns and how we can really need to look at it and try and reduce those costs. And how can we do it more efficiently? I think we need to have more of a collaborative approach, not just within merchants, retailers, but also with the carriers as well. How can we provide a more efficient way for consumers to return?

Joe Newbold:
Where can it be consolidated? Where can it be shipped back? And because it is for some retailers that use technology to make returns as simple as possible for consumers, then in some way, it's great because they have a positive experience and increases that lifetime value, but then does it over encourage returns? Or how do we see how we saw from Zara? They're starting to charge customers to return an item now, unless it's return to store. So I think that, yeah, I agree. I think crisis is a strong word, but I think it does need to be addressed. There are solutions out there that can help make returns more efficient, but I still think there's a long way to go really to make them more efficient. And I think one thing would be around the education part for consumers.

Joe Newbold:
The cost, as I mentioned, are twice as expensive, the environmental impact, how can we make it more efficient? How can we make it more sustainable? Because we do want to have that changing room experience at home where you can try things on and you can send them back because otherwise you're not going to have good conversion rates within fashion and apparel checkouts. There isn't, but yeah, I think there needs to be something addressed. And I see, especially with international returns, I speak to merchants and sometimes if, let's say, they ship to the US, if someone wants to return it, they'll just return it to a dark store in the US and never want it back because of the complexities of actually... The costs to return it back will just outweigh anything. That's something, again, that needs to be addressed.

Richard Hill:
You do hear of a lot of brands when a consumer contacts them and says, "Right, I want to send this back," but they just say, "Ah, don't worry. Keep it," because it's just not worth it. You're not worth it. Especially on some of the mid to lower end apparel, obviously it's down to price, isn't it, at the end of the day. If it's a 10, 20, 30 quid item, it's probably not well... Or whatever that price point is, it's just not worth sending it back in reality. But then that could potentially fuel more people to then just order more because they know that those brands do that. So it is... It's a real fine line, isn't it?

Joe Newbold:
Yeah.

Richard Hill:
I think returns is such an important piece, as we know, where you go to any site, if that returns policy isn't there and isn't super, super clear, but I think there's some ground that can be gained in that returns page explaining, "Well, we'll do what you want returns wise, but ultimately there will be a cost. There'll be a cost to you in the long run, environmentally and cost wise, because obviously our cost will go up and the environmental piece." Now that won't stick with many people, some people just won't care in reality, but I think more and more and more people do care. And I think that just making that point around the environmental piece will stop some people in the tracks and think, "Do you know what? It was only a tenner. I'll just keep it." I have to admit if I get something back, if I get something that's not quite right, I very rarely send it back because I just can't be bothered. It's time more than anything, the fact that I've got to go somewhere potentially. I know you don't always have to go, they'll send a courier in, but yeah.

Richard Hill:
Okay. So we touched on customs earlier, but I think customs is one that I think a lot of merchants get in a bit of a cold sweat about when they think, "Oh, customs, oh." I think of a few of our clients and people we deal with. They've got very high product value, things of hundreds, if not thousands, of pounds and obviously that potential customs piece. What would you say about trying to overcome potential custom issues in different European countries?

Joe Newbold:
Yeah. So again, this is a massive barrier to entering new markets. Again, if you don't do it properly, or seek the specialist advice to make sure you have the right processes in place and as I mentioned earlier, the consumer research report that we did at the back end of last year, 47% of consumers came back to say that they won't make a purchase if they're asked to pay any customs fees. That is a huge shutoff, almost half of your customers gone if they're asked to pay any customs fees. So I think first and foremost, it's really important that you understand how customs fees work and the different income terms. And it's not the most exciting stuff, but it's actually extremely important to make sure you can operate and be successful in those markets. So, yeah, first and foremost is if you can, because customers really against paying for customs fees, ship the items DDPs.

Joe Newbold:
That means all the tax and duties are paid by yourself, but build them into the overall cost. So the consumer doesn't get that negative sentiment that they're actually paying for it. So that's the best way you can do it. And obviously going into the European Union with the IOSS under 150 euros, that will help with those processes. Of course, working with one of the consolidators as well so you do it all in one go. So you pay it as one transaction and build all those costs into the overall cost to help save it, and then use software solutions that, within Sendcloud, we can provide all of the relevant paperwork, CN22, 23 and commercial invoices. And a lot of carriers now are often paperless trade as well. So we can just send it all back via the API.

Joe Newbold:
So there's not really any extra paperwork needed to be printed out. It's all done by the API. So yeah, it's not the most exciting topic, but it's really important, especially now that we're unable to trade fully with the EU. So it's something that, yeah, a lot of people put off because they're confused by it. They don't understand it, but I'd say although it sounds confusing, it's actually not if you dumb it down a little bit. There's plenty of advice out there, I would say. Understand it. Don't just jump into it, understand it properly before you try and test anything.

Richard Hill:
I think that what I would say is there obviously are solutions out there that can take that pain away, i.e. you guys, obviously there's other options out there, but Sendcloud will have got that functionality and that knowledge within the team to take all that pain away sort of thing. So, yeah, but I think it is... Knowing a lot of merchants, they'll start in their home country. It's pretty standard, isn't it? You start in your home country and then natural progression. We've got a particular client I'm thinking of right now, they've just relaunched their site and they've relaunched it predominantly because the current... It would only take UK pounds sterling. And now they've had a lot of different functionality and had a rebrand, but the primary thing now is that they can then take any currency and we'll be running ads on various campaigns in the US, in Germany, a couple of other European countries, very specific product sets that we've already tested in small quantities.

Richard Hill:
But with sterling which obviously is not going to be... Has not been brilliant, but we get a little feel for it, now we've got the different currencies working and everything. Now we're going to go going through that process, but customs is something that I know can worry merchants if it's newer territory. I think it'll be less and less for our listeners, but obviously there are options out there. Right. Sojo, obviously working with a lot of different merchants, a lot of different stores, what would you say are some of the almost like secret tips that a lot of merchants maybe miss when it comes to delivery, when it comes to all the things we've been talking around, like customs, delivery particularly, that you could share with our listeners that might save them, might help them get more business, might save them obviously money ultimately on their shipping costs and things? What are some sort of tips you could give us?

Joe Newbold:
Yeah. Yeah. Good question. And yeah, I'll link back to the consumer research that we do and what we're seeing in the market across our customers that we work with. And I know we spoke a bit about free delivery and how that is really influencing more orders within the UK market, but actually within mainland Europe, it's not the case. So free shipping is not the most important thing. And consumers are actually willing to pay a little bit towards shipping. And the general average across the whole of the European market is they're willing to pay 4.10 euros for delivery on average. And that varies by 3.40 euros in the Netherlands where they try and squeeze as much as they can out of it. But then in Australia, it's over five euros. So what we're seeing is actually, by charging for delivery, is not impacting sales.

Joe Newbold:
So that is something that should hopefully give your UK listeners a bit of confidence that they can actually charge for delivery within Europe. And it won't impact sales. Second thing as well is, yeah, ship internationally, great. But think locally, so consumers actually have preferred carriers. I'm sure you might do in the UK, but me personally, I have my own favorite carrier like DPDN. It always seems to find my house first and it always seems to be able to, yeah, provide good updates and things. And that is the same across Europe. So if 40% of consumers have a preferred carrier, make sure you're offering that in the checkout, because if you don't, that could obviously impact them converting. And also, yeah, one of your competitors might offer it and they'll go elsewhere.

Richard Hill:
Yeah. That's absolute... If you're listening right now, I know that is an absolute gold mine in that if you've got different courier options, as Joe said, people have a preference. They'll know based on... Especially if you're in more remote areas. It's anywhere really. I'm sat at home now recording this and I know that a couple of couriers will be here on the dot when they say they will and they know where to leave it when I'm not in, and that type of thing. Whereas if it's a newer courier or a courier that... Some of the other couriers potentially, I might have more of an issue getting that passed if I'm not in. And there's all different connotations, isn't there, based on where you live and whatnot, but having an option, having those options, having those options internationally, that's a huge win, isn't it? Yeah.

Joe Newbold:
Yeah, exactly. And yeah, even offering them in the checkout as well, consumers want the flexibility and choice and using somebody that can provide all those different options and can help you increase those conversion rates. I mean, you spend a lot of money acquiring customers on your site. Let's try and increase that conversion rate as much as you can. And one of the biggest drop off rates is having not the right delivery option available. So yeah, the more that you can offer, the more flexibility and choice, the higher your conversion rates are, which is something to be considerate of.

Richard Hill:
Yeah. Brilliant. Brilliant. Anything else there at all? One last tip before we wrap up?

Joe Newbold:
One last tip? Yeah. Again, well, that was more on the outbound side, but again, for returns as well, I think we spoke about it briefly, but make sure your return policy is clear on the website. I know I'm in the industry, so I always check it, but something that you could do, which could be interesting, is increase your return policy window. So I know a lot of people did increase throughout the pandemic from 14 days to 30 days. But try it out and try... Extend it to 100 days because what we're seeing from our merchants, they've extended it to 100 days. And in the consumer's mind, they're like, "Oh, I've got three months to send this back. I'll wait until a couple months time." And then they forget. So they don't return it. So that's a really quick, easy win that you can actually adopt and test it out. We're seeing that returns aren't increasing. In fact, they may be decreasing and that's something you can do straight away, just quickly change the policy on online.

Richard Hill:
I'm seeing more and more brands do that. Yeah. And it's, like you say, people just forget, don't they? Or they're happy with the thing anyways, but it just means they're more likely to buy it at the front end.

Joe Newbold:
Yeah.

Richard Hill:
So yeah, I think that's a great one. So Joe, we're sat here in 12 months time. What would you say we'll be talking about in terms of what's next in the world of shipping? What's next in the world of Sendcloud?

Joe Newbold:
Yeah. Good question. And I mentioned it in my introduction. So I joined Sendcloud to really build out the enterprise team instead of grow up market. So we have 25,000 customers now. A lot of them are on the SMB moving to the mid-market space, but we really want to build out the solution into more enterprise and start targeting bigger customers. And we've had some great success over the last six months with some really big brands that are coming on board in the implementation phase, but really excited to see, I think. Sendcloud is uniquely positioned as a more agile, flexible player, which, because we have such a broad base of customers, we need to provide that self-serve element.

Joe Newbold:
And I'm excited to see that enterprises customers are interested in this as well, because they want to be able to quickly add a carrier, remove a carrier, create some rules, create their own content, and then just use our APIs and create the best overall experience for the consumer, from the checkout through to returns. And we're really seeing the flexibility being key. We know how much things change within the eCommerce landscape on a day to day basis. So having someone that's agile, to be able to support that is what we're seeing. And I think that Sendcloud's uniquely positioned to be able to provide that, not only for mid-market but enterprise and some of the biggest retailers next year.

Richard Hill:
Brilliant Joe. Well, thank you. It's been an absolute pleasure having you on. Now, I like to end every episode with a book recommendation. Do you have a book that you'd recommend to our listeners?

Joe Newbold:
Okay, nice. Yeah. So yeah, the book that always comes into mind when I'm asked about books is Shoe Dog. I don't know if you've read it.

Richard Hill:
I have, yeah.

Joe Newbold:
It's about Phil Knight, the founder of Nike. I found it fascinating the way it starts off, his whole backstory going backpacking until he was 24 and not really sure what he wanted to do, keen sportsman, and then the passion and innovation throughout the whole book just really shows why Nike's become such a household name globally. Yeah, the brand that changed everything. And we actually used to run the supply chain at DHL in the US. I never got to go there. But a lot of people did, said it was just such the most... An amazing place to work. And Phil Knight was always in the office every day even. Yeah, just sat there, in the canteen. So that's my book to recommend. I think it's fascinating.

Richard Hill:
Brilliant. Thanks, Joe. That is an amazing book. It's one I read a few years back, a brilliant book. Yeah. It's been mentioned a couple of times, so thank you. Well, thank you for coming on the show. The guys that are listening that want to find out more about you, Joe, more about Sendcloud, what's the best way to do that?

Joe Newbold:
Yeah. We can send some stuff over to you after this. Maybe I can send over the consumer research report and attach my contact details, help give your listeners a bit more context to some of the stats that I talked about, but yeah, you can find me on LinkedIn, Joe Newbold, or emails, joe.newbold@sendcloud.com, but yeah, we can send some content. Maybe you can distribute or publish it somewhere we can.

Richard Hill:
Yeah, no problem. And obviously you can sign up for free at sendcloud.com as well and obviously speak to one of the managers there and talk about shipping options and things like that and what's available. But thanks, Joe. Thanks for coming on the show. I look forward to seeing you again soon.

Joe Newbold:
Yeah. Cheers. Thanks.

Richard Hill:
Bye bye. Thank you for listening to the eCom @ One eCommerce podcast. If you enjoyed today's show, please hit subscribe and don't forget to sign up to our eCommerce newsletter and leave us a review on iTunes. This podcast has been brought to you by our team here at eComOne, the eCommerce marketing agency.

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