UK businesses looking at acquiring a new audience and expanding into a different market will find a wealth of opportunities available in Switzerland. This mature economy has strong links to the UK, with bilateral trade between the two countries already worth over £31.9 billion a year.
Access to this exciting market involves overcoming some of the typical issues that any business might face when sending parcels to Switzerland.
Exporting to Switzerland
Switzerland has a stable economy with positive growth forecasts and a strong relationship with the UK. Exports of UK goods and services to Switzerland have grown by 130% over the last 5 years, making this the highest growth market for UK exports over the last 10 years after China. Switzerland’s central location, simple regulatory and legal environment and low VAT attract many overseas businesses, especially as purchasing power in Switzerland is some of the highest in the world. Swiss consumers enjoy Europe’s highest per capita income, are open to foreign brands and are easy to communicate with, as English is widely spoken.
Shipping issues your business might face
- Domestic rules and regulations. Switzerland is not part of the EU and, although there is consistency between many EU regulations and those in Switzerland, there is a unique set of domestic rules and regulations to navigate, including a separate customs administration.
- Customs tariffs. Switzerland is fairly unique in that it is one of only two countries in the world that levies customs duties based on weight. The weight used to calculate the duties will include the item itself as well as the packaging.
- Currency. Most Swiss consumers prefer to pay in their local currency – CHF.
- Shipping costs. Although Swiss consumers are used to paying for their shipping, they don’t expect to have to cover high shipping costs and, increasingly, expect to see low cost or free returns as greater numbers of retailers offer this.
How to deal with them
- Get to know the Harmonised Customs System. Switzerland uses the Harmonised Customs System, which applies specific codes to classify traded goods on a common basis for customs purposes. Ensuring you have the right HS Code, as well as data such as parcel weight and contents description will provide a smooth transition for your goods through customs. It’s also worth noting that Switzerland gives preferential treatment to goods originating from within the EU, despite not being officially a part of it.
- Make sure you understand how the tariffs apply. Duties vary depending on the item – a pair of sports shoes, for example, will attract duty of CHF206.00 per 100 kg. Some countries receive preferential, lower tariffs but there are also products (such as biotech food products and agricultural products) that attract higher than normal tariffs. Any duty of CHF 5 or less isn’t usually charged, which is a useful way for overseas e-commerce businesses to save money on customs duties for parcels to Switzerland.
- Offer transparent payment options. Whether you’re offering CHF as a payment option or not, it’s essential to ensure you’re transparent about costs. Swiss consumers prefer to see their costs up front, factoring in any shipping and duties – as opposed to additional extra costs being added at check out.
- Think carefully about the cost of shipping and returns. Many businesses selling into Switzerland charge up to CHF 8 for shipping but will offer this free over a certain spend (e.g. CHF 100). Foreign retailers are increasingly offering free returns so it’s important to keep these costs low to avoid losing customers.
Like any destination, exporting to Switzerland can mean overcoming some specific shipping obstacles. However, once you’ve factored in the above issues then your business is well prepared to deal with them.