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There is nothing more annoying to your customers than buying something online and then having to pay a doorstep charge before the item can be handed over. Usually it’s the parcel delivery company that is demanding payment. Either your customer receives an email with a link to pay, a card through the letter box, or even a letter in the post with a surprise invoice.
What is even more frustrating is that the delivery company applies an admin or handling fee in addition; this can be up to €60!
This is a terrible customer experience, yet this is what thousands of UK e-commerce companies are doing every day to their customers in the EU. This one experience is enough to prevent customers from ever buying from you again, which for many micro, small and even medium-sized businesses is threat to their entire operation. It can also lead to bad reviews, damaging your reputation and your revenue.
Is Deliver Duty Paid the solution? Not really.
Savvy UK e-commerce businesses initially thought that switching to sending DDP (Deliver Duty Paid - which means that the VAT and EU import charges are reversed back to the UK e-commerce company so that the EU customer is not charged on the doorstep) could be the best option.
However, this comes with a sting in its tail. Most of the large multinational parcel delivery companies will apply a Deliver Duty Paid surcharge. The surcharge is so high that lower order value shipments are simply not cost effective to send, and it’s difficult to pass these costs on to your EU customer.
Is IOSS the solution? Possibly.
The other option is to register for IOSS and get an IOSS number. Anyone that has investigated or implemented this will also know it costs the average volume shipper around £4.5k to £5k a year to register, administer and maintain. This a good solution for large volume shippers, but cost prohibitive for smaller e-commerce businesses.
So what are the other options for small and medium sized UK e-com businesses that are not so cost prohibitive?
Is there another way? Yes. Step up SAMOS.
SAMOS has created the UK’s first hybrid EU parcel delivery service whereby it is impossible for the customer to receive any doorstep charges. The service works very much like Deliver Duty Paid in that import charges are paid on behalf of the EU customer, then reversed back to the UK ecommerce company. The difference with SAMOS is that this is done free of charge. No hefty Deliver Duty Paid surcharge (or any other surcharges for that matter).
Important to remember! Your customer must pay VAT, no matter what process is used to charge them Our process means that there are no surprise doorstep VAT (and admin) charges.
There is a huge difference in customer experience here –
✔️ Pay it all in one go in the checkout process, with no doorstep charges – the SAMOS method (the same customer purchase and delivery experience as before the UK left the EU).
❌ Pay for items in checkout, pay VAT and admin charges at the doorstep – terrible customer experience that should be avoided.
The SAMOS process works like this: the UK e-com company itemises the import charges in the checkout separately or includes them in the item cost on their website. Whichever they choose, it means that the import costs (VAT and Duty) are covered in the checkout process.
SAMOS will then pay these charges on import into the EU and reverse them back to the UK ecommerce company. As the charges have already been received by the UK e-commerce company during the checkout process, these charges don’t come out of the margins. The only real charges are the shipping charges, which are exactly according to the tariff.
No IOSS number? No problem.
You do not need an IOSS number to use the SAMOS service, therefore you don’t need to go to the expense of acquiring and administering an IOSS number, or pay extra per parcel for a pay-as-you-go IOSS scheme. This is around a £4.5k - £5k saving per year (on average).
We understand that this the only service available of its kind designed for small and medium-sized e-commerce businesses. The motivation behind creating this service is for EU customers to experience the same simple buying and delivery service from UK e-commerce companies as they did before the UK left the EU:
- Order from you
- Pay all charges in the checkout process including VAT
- Parcel is delivered with no doorstep charges
Only this kind of reliable customer buying and delivery experience will ensure that you are able to develop customer loyalty and drum up repeat business while avoiding the kind of reviews that turn new customers away.
If you’re unsure, then trial our service. We bet it is exactly what you have been looking for but didn’t think existed.
