26 January 2016 by Calan
I received a comment on our Kickstarter project recently saying that it's unfair that we will be fulfilling backer rewards to UK backers from within the UK, and to the rest of Europe from our fulfilment partner in Hong Kong, because Europeans would be liable for import duties. This is a pretty reasonable objection and I understand why Europeans would be aggrieved. After all, as our project is based in the UK it is a fair assumption that the rewards would be shipped from within the EU.
Firstly, I have to start by saying that the task of fulfilment is no easy feat and I've done a ton of research on how best to do it. Consider for a moment that we had backers from 48 countries support our project. Every country has their own legislation around custom duties and import tax (VAT), and each has its own threshold below which the consumer isn't liable for either. For example, a US citizen can import anything up to $200 without paying duties on it, while in the UK that limit is just £15. Adding to that, some countries are just super expensive to ship to, especially if the product is heavy or bulky.
Then there's the argument about whether we should import the products into the UK before shipping them across Europe. The reason I was going to ship straight from Hong Kong is because, as crazy as this is, the individual shipping cost is significantly cheaper. To keep shipping rates as low as possible for everyone on Kickstarter I had therefore planned to fulfil from Hong Kong.
Even if shipping from HK, we still lose on the shipping cost, which eats into our margin on the product, so we generally make very little off European orders at this stage. This was a tricky decision upfront but I would've had more unhappy European backers if I'd charged the actual shipping costs as it would’ve been a disproportionate amount of the cost of a Loogun.
The big problem is that shipping is expensive everywhere other than in the UK. If the product is small and light then you can get away with it, but the Loogun is neither and it's therefore not the most ideal product for international shipping. Even more shocking perhaps, is that it costs less to ship a single Loogun from Hong Kong to a buyer in the US than it does to send a container to the US and then use USPS, UPS or FedEx to ship it to the buyer. This is just nuts. The only exception is Amazon Fulfilment Services who offer slightly more reasonable rates to fulfil US orders which in itself is pretty crazy that a retailer can beat two of the biggest logistics companies in the world.
But back to the EU issue. I've spent some time over the last week looking into this and have decided to fulfil all EU orders from the UK. It's going to cost a fair amount more but I'll accept the costs in order to avoid our European backers having to pay additional import fees.
This should keep all our European backers happy and our US backers shouldn't be liable for taxes for amounts under $200 so you should all be fine too. If you've ordered your Loogun from further afield, there's unfortunately not much I can do to prevent you being charged with import duties, but I guess you will have already experienced this with other Kickstarter projects and international orders.
On a side note, here's a little trivia for you. The CMA CGM Marco Polo, the ship pictured above, is the world's largest container ship. It measures 396 metres long, equivalent to over 100 family saloon cars and the ship can carry more than 16,000 containers. It boasts a variety of environmentally-friendly technologies, such as an electronically-controlled engine that allows reduced fuel consumption, and an improved hull design that lowers its CO2 emissions.
Have a great week everyone and please add a comment below if you have any questions or thoughts you’d like to share.