cannonball game

FREIGHT SHIPPING

Shipping product between countries isn’t the easiest of steps.  There are a lot of fees, forms, and coordinating involved to make your product travel from the manufacture to you, especially when shipping internationally.  Here are a few terms you should know:

 

 

Freight Forwarder

They concentrate on the logistics and physical transportation of cargo.  They are responsible for transporting your goods.

 

Customs Broker

They are the intermediary between the importer and the government’s customs department.  They are responsible for handling all the paperwork necessary to get your goods through customs.

 

Brokers handle the importing goods, not exporting.  Exporting is not a problem.  Trying to get something into a country is the issue.

Many freight forwarders have their own customs brokers or are partnered with a customs broker.

 

Packing List

Your manufacturer will create a document known as a Packing List, which basically contains all the details of the cargo:

- Number of cases

- Number of pallets

- Dimensions

- Weight

You need a packing list to get a shipping quote.  The freight forwarder needs to know what they’re delivering.

 

Before your manufacturer generates a Packing List, be sure to provide your any special packing instructions.  For instance, if your endgame is Amazon, Amazon only allows 40x48in, four-way access pallets.

 

 

Bill of Lading (BOL)

This document accompanies your shipment.  It is your official shipping label.  It’s also a receipt and mini-contract all rolled into one.

 

Incoterms

Incoterms is the name given to the terms of agreement regarding international shipping between buyer and seller.  Incoterms are published by the International Chamber of Commerce.  As of 2020, there are eleven Incoterms.  Only a handful are relevant to our purposes:

EXW (Ex Works): The seller packs the goods and makes them available for pickup at their factory.  It is the buyer’s responsibility to orchestrate all shipping.

 

FOB (Free on Board): The seller brings the product to the departing port and loads the goods on to the ocean liner.  From that point on, the buyer is responsible.

 

DDP (Delivery Duty Paid): The seller is fully responsible for getting the product to your doorstep (or whatever destination you choose).

So how should you ship your product?  Well start by seeing if your manufacturer offers DDP (which most do).  They’ll get you a quote from their go-to freight forwarder.  They’ll throw in their service fee.  If you find that total price acceptable, I say do it.  Make shipping their problem and relax.

 

Feel free to contact other freight forwarders and try to get quotes.  In my experience, it took awhile to get a response.  And many said they only take on customers who will do repeat business, as in ten or more shipments a year.  Also as a new customer you will mostly be required to place a rather large deposit before shipping. 

 

Your manufacture has already established a relationship with a freight forwarder.  Since trust has been built, your manufacturer doesn’t need to do a deposit.  Also, if your shipment gets stopped for a customs exam, the freight forwarder will pay the exam fees right away so your shipment doesn’t get any more delayed.  You’ll obviously have to reimburse them but it’s a nice perk of having an established relationship.

 

My freight forwarder is TopOcean.  My cousins already ship goods from China and had the established relationship, thus why I choose them.  They weren’t that much cheaper than doing DDP with the manufacturer.  I've attached the bill.  So you can see all the required fees involved with international shipping.  Note that this is for five pallets and doesn't include the custom broker fee of $158.  Plus I got stopped at customs where they gave me the full pat-down (so ignore the two exam fees).

Shipping Containers

When you're shipping small quantities, your pallets are being loaded into a shipping container with pallets from other companies.  So your container gets shipped to the port of entry, opened up, and then everyone's pallets are separated and loaded onto different trucks.  This sorting process takes a couple days and costs extra money. 

 

To save time and money, you want to eventually ship full containers only filled with your pallets.  The standard size for containers are 20ft and 40ft.  It does not cost that much more to ship a 40ft container over a 20ft container, so aim for 40ft to obtain the best deal.  If a container only has your pallets, the container is sent straight to you.  No need to pay people to waste time separating and reloading the pallets.

A 20ft container can hold 10 pallets, while a 40ft container can hold 20 pallets.

So when ordering units, only order in quantities that fit perfectly into a full container.  For instance, I fit 200 units of Plunder: A Pirate's Life on a single pallet.  And twenty pallets fit into a container.  So that's 4000 units per container.  When I place my orders, I should do multiples of 4000 units.  So 8000, 12000, 16000, etc.  If I were to order 5000 units, 4000 would be in their own container, which would get to me a couple days sooner than the 1000 that's stuck in a random container with other products.  That 1000 would also cost more per unit to ship because of all the extra manual labor involved in sorting the pallets.  Also remember that your manufacturer probably makes extra units in case of defects.  My manufacturer makes an extra 1% of units.  They can fit the extra 1% of units in the same container.  Since it's such a small amount, they can typically tuck the extra units into the container.

To increase the units per shipment, you can also ask about double stacking your pallets.  This is when they stack another row of pallets on top of your original pallets.  Basically building upwards.  The only problem with this method is if your units are heavy.  The boxes on the bottom might get crushed from all the weight.