What are cross trade shipments (third-country shipments)?
In logistics, a cross trade shipment (also called a third-country shipment (in Dutch) or triangular transaction) is when goods are carried from country A to country C, while you (the seller and organiser of the transport) are based in country B.
A classic example is a Dutch e-commerce or B2B company that buys products in Asia and sells them directly to a buyer in North America. To save time, storage costs and double customs charges, you have the goods flown straight from the factory to the buyer.
A real-world example: arranging a shipment from China to the USA
Say you've just closed a great deal. You need to arrange a shipment from China to the USA right away. The goods are ready at the factory in Shenzhen and your B2B customer in New York is eagerly waiting for delivery.
The role of your dropshipping supplier
In this model, your manufacturer in China effectively acts as your dropshipping supplier. The biggest risk in this set-up is visibility. You definitely don't want your American customer to see what you paid for the goods in China or, worse, to contact your manufacturer directly.
That's why professional cross trade logistics uses a 'blind shipment' or 'neutral delivery'. The factory's original commercial invoice is only used for export customs in China, while your own sales invoice (with your logo and selling prices) is used for import customs and final delivery in the United States.
What to watch out for in cross trade logistics
A third-country shipment sounds like the perfect efficiency gain, but it takes tight coordination. These are the main points to watch:
Setting the Incoterms: who is responsible for which part of the transport? With cross trade, clear agreements are essential. Using the official rules of the International Chamber of Commerce (ICC), you might agree EXW (Ex Works) or FCA with your supplier, so you keep full control of the transport and the Incoterms (in Dutch) towards your end customer.
Customs in two foreign countries: you deal with the export rules of country A and the import rules of country C, while you're based in country B. Make sure you know the local customs information in advance to avoid hold-ups.
Dealing with local carriers: booking transport by hand in countries where you have no physical presence often means language barriers and time differences.
Why run your cross trade through ParcelParcel
Coordinating a shipment between two distant continents by hand takes a lot of time. If you want to send a business parcel (in Dutch) through a cross trade set-up, the ParcelParcel shipping platform is the ideal solution.
You log in from Europe and enter the collection location (e.g. China) and the destination (e.g. the USA). Our system instantly calculates rates from premium carriers such as FedEx, DHL or UPS. On top of that, our customer service helps you draw up the neutral documents correctly, so your supplier stays hidden from your end customer.
