As a WooCommerce store owner, you may be selling products internationally. Once you receive orders, it is your responsibility to ensure that the products reach the customers quickly and efficiently without delays.
Your customers don’t care for the rules and restrictions of international trade. They are concerned with how swiftly their ordered products reach them. As a business owner, you must comply with all the rules and documentation expected in selling internationally.
Subsequently, in this article, you will learn about commercial invoices and their various components. You will also understand the difference between different product costs and why you need to correctly disclose the same in the commercial invoice to avoid unnecessary dues and delays at customs.
What is a Commercial Invoice? And How Is It Important In International Transactions?
A commercial invoice is an essential document without which your shipment cannot cross a country’s borders. It is the document that serves as a request for payment from the buyer. For local sales within a country’s borders, the woocommerce proforma invoice is sufficient. But for international sales, a commercial invoice is necessary.
It contains information regarding the seller, the buyer, the product descriptions, the cost of the products, and any other charges like freight and insurance.
An accurate commercial invoice is incomplete without these particular details:
- Seller’s name and address
- Invoice details like number and date
- Buyer’s Details
- Delivery Address (may differ from buyer details)
- Product Description like no. of units, cost per unit, and also HS code of the product
- Cost of shipment including freight and insurance charges
- No. of packages and currency of transaction
- The country of origin of the products
- The signature of the seller/shipper/exporter
A commercial invoice needs to be accurate in all aspects to be considered a valid document. Customs authorities may hold the goods indefinitely or even charge excessive duty, even if the shipping charges are not mentioned correctly in the invoice.
Incidentally, the cost mentioned in the commercial invoice needs to reflect the actual value of the products included in the shipment.
First, let’s look at the cost and how you can have different costs for products.
Difference Between Original Price, Discount Price, Customs Declared Value, and Insured Value
In your woocommerce store, you may have several products you have put out to sell. Each product has a different cost, based on its usage and the components used to build it. Each product has a particular price depending on the operations involved in manufacturing it.
The actual retail value at which you have decided to sell your products is the original price. This is the retail price of the product without any alterations.
On the other hand, the company may have allowed discounts on some products based on business strategies. The value of these products is disclosed at a discounted price. In a commercial invoice, it is essential to show the discounted value clearly. If the discounted value of a product is US $ 9, then this amount needs to be disclosed in the invoice. Hiding discounts may incur additional costs at customs or even delay clearing the shipment.
According to FedEx, the custom declared value is the total value of your products, including any additional costs like freight and insurance that have been incurred on the same. It is the total value of the shipment after reducing any discounts or rebates on the shipment.
Furthermore, the products may have been insured against damages and theft. The insured value may be more, less, or even as much as the total shipment cost.
How can you choose which one to declare on the commercial invoice with four different values for products?
Disclosing The Right Product Price in A Commercial Invoice
To ensure that your products clear customs quickly without issues, the commercial invoice and shipping labels, along with all other documentation, must be accurate and error-free.
Ultimately, in the commercial invoice, the cost of your products is the actual value paid by the customer. This means that if you have 5 units at US $10 and freight and insurance together are 100, the actual cost in the commercial invoice would be US $ 150.
On the other hand, if you have offered discounts, the discounted value of products would be displayed in the invoice. If you have sold 5 units at a discounted US $ 5, then the value disclosed in the invoice would be US $ 45. With freight and other charges of US $ 100, the actual invoice value will be US $ 145.
So, it is clear that the invoice value, which will be considered a custom declared value, will be the actual price paid by the customer for the products.
Benefits of PluginHive FedEx Plugin For Disclosing Correct Commercial Invoice
The PluginHive WooCommerce FedEx Shipping Plugin with Print Label is a complete solution for shipping WooCommerce products to your customers using FedEx. The plugin gives you accurate live rates directly picked up from the FedEx database. It also allows you to print the correct shipping label with all required information for faster shipping.
For international transactions, the plugin also allows printing a complete commercial invoice holding all accurate information needed for shipping products with ease.
The value disclosed in the commercial invoice determines the amount of customs duty to be paid at the international borders. The PluginHive plugin allows you to choose the correct value to be disclosed in the commercial invoice.
Visit our product page to know more about the various features of the PluginHive WooCommerce FedEx Shipping Plugin with Print Label.