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For example, let's go bigger...
Let's say I was selling a 40 pound item that cost $1000
What fees/taxes/duties are the customers going to be hit with? Can the customer 'get out of' paying those and have them fall back on me?
Since (I assume) I couldn't do AVS on a credit card, how would a merchant lower his chargeback risk?
What (UPS/USPS) would be the best way to ship for the benefit of the customer (and again, protecting the merchant)?
It would have to be something that is otherwise virtually impossible to get in Canada, or be at a very high price point.
If you live is southern Ontario, Quebec, Vancouver etc. then bringing items across the border can work well. I've done it quite a bit, and to be honest, it is way less hassle than most people think.
(a) Free shipping to just south of the border, where your package(s) can be held for about $2/package/month.
(b) Prices tend to be significantly less. Sure, on small ticket items, it may not be worth the hassle. The closer you are to the border, the lower the item can cost to make it worth while. I've patronized US retailers for everything from my car to my hot water tank. I have to scratch my head sometimes on the often 50% margins between the two countries.
To me this prospect seems almost impossible. While most Canadians live within 200 miles of the border, they tend not to live right ON the border. A typical customer would be looking at a round trip of several hours up to a full day, plus crossing the border isn't something people especially look forward to these days.
I used to live a mile from the border (Langley, a suburb of Vancouver). It was not uncommon to cross the border just to get a tank of gas and some milk. Now I live an hour from the Mexican border, and about 20% of vehicles at the shopping malls have Mexican license plates. Cross border shopping is pretty common in my experience.
As for ecommerce, since most of the products that I sell are too large for USPS, and the brokerage charges are too expensive with UPS and Fedex, the option to pick it up on the US side is more popular with my Canadian customers than direct shipment. Your mileage may vary.
What is more interesting to me is that I have yet to have an order from Mexico even though I am 60 miles away and there are 4 million people right across the border. Must be the lack of spanish on my site. But that is off-topic.
Sticking to the point - small items go USPS direct to the Canadian consumer, large items preferably are picked up at a point just on the US side of the border. Avoid Fedex and UPS brokerage whenever possible.
Having customers cross the border to pick up shipments is not a business strategy. It may work in some instances but is not viable if you are attempting to do any volume of business in Canada.
Personally, i find it a complete hassle crossing the border these days - especially if it is just to pick up a shipment. Cross border trips are an experience to be avoided at all costs. Things have deteriorated substantially since 2001. I know that cross border day trips to the US have declined by about 60% since the early 1990s. We used to go down several times a year but have now not been down since 2004.
Use USPS/CPC if at all possible. The end costs to the customer will be much lower. Fedex and UPS should be avoided. I have lots of experience with UPS. UPS is simply not interested in cross border shipments in my experience. There are many things they could do to simplify and reduce the costs for cross border shipments. Unfortunately, they just don't get it - I am quite certain they don't want to get it.
The big cross border operators usually arrange to pre clear goods through customs and then transship them from a Canadian address. For example, amazon.ca ships their goods from a warehouse in Toronto which is owned and operated by one of the many subsidiaries of Canada Post. Other companies move their goods across the border from Buffalo to Fort Erie or from Detroit to Windsor and tranship from there. In this way their customers do not have to deal with all the customs complications.
Cross border shopping is pretty common in my experience.
Its still very common, especially with the soaring Canadian dollar. We do it at least once a month for our home. But not everything is a bargain, you have to be careful while doing your cross-border shopping. There was a time before 9-11 a sizable portion of my grocery purchases were "over the the River" (that is the term we use here in the Niagara Region of Ontario).
I will stand by my post at the top of this thread ... USPS is the best way for a US company to get goods to Canadian consumers.
1) How can I find out more about these "Holding Points" near the border?