Choosing Between Air and Sea Shipping from China

Category: Entertainment

Presentation Description

The invention of containerisation has been a game-changer for international trade feeding the beast of Consumerism this past century. Originating in the British coal mining industry of the late 18th Century to address the necessity to break bulk, which was a fairly time consuming and inefficient process, the first container system was implemented in Poland in 1919 by the engineer, Stanisław Rodowicz.


Presentation Transcript

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Choosing Between Air and Sea  Shipping from China  The invention of ​containerisation ​ has been a game-changer for ​international  trade ​feeding the beast of Consumerism this past century. Originating in the  British coal mining industry of the late 18th Century to address the necessity to  break bulk which was a fairly time consuming and inefficient process the first  container system was implemented in Poland in 1919 by the engineer Stanisław  Rodowicz.  Containers are now commonplace and integral to the movement of goods and  commodities across the world’s oceans. One of the main considerations when  sourcing from China ​ or any other Asian country is how to ship your products in

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the most cost-effective and efficient way. In this piece we will be reviewing the  implications of how to ship your goods.  How to Measure Costs     Sea Shipping  Clearly ​shipping by ocean ​ freight is the first option that companies consider  when moving goods from Asian to their markets. In fact ocean freight is  approximately ​90 of all outbound shipping ex China ​ primarily due to the  cost-effectiveness.  When factoring the most financially astute options consider that the expense  should also factor in timing and ​local charges. ​ And obviously also quantity weight  and volume CBM.

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There are ​three types of container ​ for ocean freight:  ● 20 foot ft container approx 28CBM  ● 40 foot approx 62 CBM  ● 40 ft HQ 65 CBM  Freight on Board  It is really important to understand at the outset for any production or order  placed on an ​FOB ​ basis ​Freight on Board ​ what the CBM will be and the  implications of how you plan to ship the goods. First thing avoid shipping  ‘air’/empty space as this will directly ​impact the unit cost of your products ​. Also  from a transit perspective it can lead to ​damaged goods ​ in certain instances. For  example the goods could move within the container on rough seas. For this  reason the factory should make sure that they load the container effectively to  minimise any movement of packaging. ​ Clearly this is something a sourcing  partner on the ground can assist with.  In case the order doesn’t feel a container to the full you have a couple of choices.  You can:  ● Ship by LCL less container load  ● Consolidate with other shipments  ● Ship by Air if time is short.  The best option would be ​to consolidate other production runs ​ which will  require assistance from your freight forwarding company. Although there will be  additional local charges ​ incurred by the factories which you will need to likely  manage and additional costs on your invoice from the freight forwarder this would  likely be the most cost-effective option. The LCL option would mean your goods  being palletised and added to another container. More touchpoints and waiting for  other goods to be added will lead to higher per-unit costs and longer lead times in  getting the goods from their country of origin to your warehouse.  Air Shipping

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Air shipment is the most expensive ​ method of transport. However it enables  goods to arrive within a much shorter time into your warehouse. Calculated on the  higher of CBM volume and weight it can be advantageous for smaller products.  In fact in this case the per unit cost will not be prohibitively higher relative to  ocean freight costs. This is particularly true with higher-margin products that are  better placed to absorb the airfreight costs.  Current Considerations  This is all in an age of Consumerism that is driving changing patterns in how  companies purchase their products. Companies are mostly looking to benefit from  more frequent orders but lower volumes ​ to minimise working capital tied up with  factories whilst ​leveraging the greater flexibility that smaller production runs  present ​ particularly relevant within the fashion sector. Working closely with your

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freight forwarder and your local sourcing partners is therefore increasingly  important to ensure that you are shipping your goods in the most efficient way.  New Sulphur Regulations: IMO 2020  It is also worth mentioning that ​cost structures for container shipping will be  changing in 2020 ​ if you have not already had uplifts. This is due to the new  Sulphur regulations ​ that come into force in 2020. This is certainly a win for the  environment and requires significant investment by the carriers across their fleets.  The approximate cost of a 20ft from China to the United Kingdom at the time of  writing is is 700 and a 40ft is just under 1000 plus additional surcharges.  Risk Management Whatever mode of freight you are considering when it comes to shipping goods  from China or more broadly Asia make sure that you have the necessary  insurance Goods-in-Transit insurance to protect against any damage or loss.  Containers as robust as they are are loaded onto carriers and pass through  thousands of miles of open ocean. During these journeys there will be knocks  rough seas and in some instances l ​ost containers ​. In fact ​hundreds of containers

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are lost every year at sea ​ which is now also presenting an environmental issue as  highlighted by the first of its kind ‘Shipping containers at sea an unacknowledged  drift report’.  Also liaise with your ​freight forwarding company ​ and any local sourcing partner  when it comes to a certain type of product. For example when shipping wooden  products from humid climates to colder temperatures. In this case make sure they  have the relevant anti-humidity or anti-mould safeguards in place. ​A container  should be sealed ​ and the seal number past to you as the consignee for checking  on arrival. It should be ​untampered ​ on arrival and should there be any evidence  of tampering. Then you need to make sure that the Freight Forwarder is made  aware before the container is opened.  Summary  There are numerous factors to consider when it comes to shipping goods from  China and other Asian countries. ​A good supplier will assist and guide ​ you when  it comes to CBMs container loading etc. Whether you are thinking of sea  shipping from China or air freight make sure you are leveraging the advice of your  Freight forwarder or your local sourcing partner who are best placed to help you.  At ET2C we have our own experienced ​logistics department ​ to help our clients  with all their shipping needs liaising directly with your freight forwarder at origin to  ensure that not only the containers are correctly loaded and sealed but to make

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certain that the shipping documentation meets all your needs to import from Asia.  For more please ​contact ​us at ​ ​.   Original Source: ​

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