FedEx has launched a Shopify app that shows shoppers a guaranteed duty and tax amount at checkout on international orders. The app is called FedEx Duty and Tax, and costs $99 a month, reported Supply Chain Dive.
FedEx will cover the difference if the actual duties and taxes come in higher than the amount shown at checkout. It will not refund the difference if they come in lower. The amount charged includes a service fee.
The app is part of a larger set of tools FedEx calls Global Trade Navigator. The others work before the shipment leaves:
FedEx Trade Planner, a free tool on fedex.com, finds the Harmonized System code for a product and estimates the duties, taxes and fees.
FedEx Ship Manager now shows the HS code, customs value and country of manufacture for each product.
Global Trade APIs let larger shippers pull the same classifications and duty estimates into their own order systems.
FedEx says 68% of small and mid-size businesses see customers surprised by duties at delivery at least some of the time, according to an April poll for its Small Business Trade Index. Sixty percent said they have lost revenue to refunds or abandoned purchases as a result.
UPS launched a similar service last year, called UPS Global Checkout, which shows shoppers a guaranteed total landed cost before they buy. Zonos, a cross-border software company, also sells a Shopify app that calculates duties at checkout and pays any customs billing discrepancies. Walmart shows duties at checkout on the US marketplace orders it ships to Mexico.
Both carriers built these tools after the US ended duty-free entry for parcels under $800 from every country a year ago.
Jason Brenner, FedEx’s SVP of digital portfolio, told Supply Chain Dive the app is “at parity or better” with competitors on cost transparency. He said there is “more to come” on where the app will be available beyond Shopify.
