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Everything you need to know about shipping from China
The business of international shipping can be very complicated and difficult to understand because of the processes, terminologies, paperwork etc. involved. However, this does not have to be the case with you. Whether you are an individual who wants to move freight from China to another part of the world, or a small-, medium-, or large-scale business looking to get involved in shipping from China, worry no more. You are in the right place. In this article, you will find out everything you need to know about shipping from China.
We simplify the process by explaining the shipping terms commonly used, and provide answers to whether you will need insurance or not. Other areas that are covered here include the transit time for your shipments from China, the documents needed, and the cost of import duty on your cargo. You will also learn some helpful tips to make your shipping from China easy and efficient.
What are the shipping terms?
There are three shipping terms that are used by China suppliers/manufacturers and overseas importers during the international shipping process. These terms are Ex Works (EXW), Free On Board (FOB), and less commonly, Cost, Insurance, and Freight (CIF). These terms are part of the International commercial terms, otherwise known as Incoterms, that dictate how buyers and sellers conduct their international and local trading activities.
· Ex Works (EXW)
Ex Works is used to describe an arrangement in which the seller or supplier of a product will make the product available at a particular location, while the person buying will pay for the cost of transporting that product. All the seller has to do is make sure the goods or cargo are ready and in good condition at the specific location, while the buyer will be responsible for the risks and other expenses like loading the freight, meeting customs regulations, or transferring the shipments to an airplane or ship. The location may be the seller’s warehouse or the nearest port to the seller.
Ex Works is more beneficial for the seller/supplier than the buyer/importer because the buyer is covering all the risks involved in the shipping process and paying all the required fees for loading, transport, documentation, unloading etc.
· Free On Board (FOB)
Free On Board (FOB) is used to describe the point where the supplier/seller or the buyer/importer is responsible for the goods or cargo that are destroyed or damaged during the shipping process. It is used to indicate the point where the risk or liability is transferred from the seller to the buyer.
If the contract indicates “FOB origin” or “FOB shipping point”, this means that the buyer assumes ownership and the risk for the freight as soon as they are shipped by the manufacturer or supplier to the port of origin. The buyer pays the costs of insurance and freight when the goods leave the point of origin.
On the other hand, if the agreement states “FOB destination”, then that means that the supplier or manufacturer is responsible for the risks associated with the damage and destruction of the cargo until they reach the importer/buyer at the destination. The seller insures the goods until they arrive safely. This option is more preferable for the buyer because the responsibility and risks for damage only come to the buyer when the goods upon delivery at the destination.
· Cost, Insurance, and Freight (CIF)
Cost, Insurance, and Freight (CIF) is only rarely used when shipping from China. It involves the expense that is paid by the supplier to cover the cost, insurance, and freight for the goods that buyer/importer purchases during the time it is in transit. It also defines when the liability for the cargo shifts from the seller/supplier to the buyer/importer, just like FOB. The major difference is that CIF is more expensive because all the costs and liabilities are carried by the supplier until the importer receives the goods.
The supplier’s responsibilities include buying the export licenses for the freight, paying the costs for moving the goods, covering the freight insurance, handling inspection of the freight, and covering the costs of destruction or damage.
How long does it take to ship from China?
How long it will take for your freight to arrive from China depends on the shipping method you use. It is also important to note that the shipping method you choose depends on some other factors such as the size and volume of your freight. Generally, air freight is the fastest means of shipping from China, followed by rail freight, and ocean shipping.
When you use air freight for your shipment, how quickly your goods will arrive will also depend on whether direct flight services are used or indirect flights are used from airports in China to destination airports worldwide. Generally, your cargo will arrive within 2-3 business days through direct flights while it may take 3-7 business days if it comes through indirect flights. International express freight services are also available for the prompt delivery of your packages.
Cargo shipped from China through rail freight usually takes about 30 days to be delivered across various destinations in Europe. For goods that are shipped from China through ocean freight, they typically arrive at various destinations around the world in about 45 days.
Average delivery time
1 – 5 business days
2 – 7 business days
About 25-35 days
About 25-45 days
Do I need freight insurance when shipping from China?
Insurance is crucial for the long-term success of any business involved in the supply-chain process. Freight insurance is important for protecting you against accidents or loss that may occur when you are shipping from China. Because it may be nearly impossible for suppliers, manufacturers, sellers, or freight forwarders to control the risks involved in the entire time, freight insurance is key.
So, if you can buy insurance for all your freight, do so, but if not, ensure to buy insurance for your high-value goods. Winsky Freight can offer insurance rate on goods up to 0.3% of its commercial value.
What is the cost of shipping from China?
How much it will cost to ship from China depends on a number of factors such as the type of cargo you want to ship and its weight, the shipping method you use, the shipping destination, etc.
Generally, shipping via air freight is the most expensive of all shipping methods. So, you should expect to pay more if you want your cargo moved from any of the airports in China. Also, the farther the shipping destination from China, the most it costs to ship your freight. Similarly, the larger and heavier your goods, the costlier it’ll be to ship.
To get precise shipping costs for your cargo, it is advisable to request a quote from your freight forwarder because you will need to present details of your shipment that will influence what the exact price will be. Shipping costs tend to change regularly and quotes often expire in a short period of time because the international freight market is volatile.
What are the documents needed to ship from China?
International shipping, logistics, and customs clearance all thrive on accurate documentation. When your documentation is properly completed, your shipments will be able to reach its destination and clear customs without delay. But what are these documents that you will need when you want to ship freight from China? Sometimes what you require will depend on the types of goods/freight that you have and the country of destination.
Two shipping documents that are mandatory for all international shipping processes are Packing List and Commercial Invoice.
· Packing List
The Packing List will contain information about the volume of the products, the different types of products, and their quantities. It is often the document that is used to verify that the items on the bill of lading are delivered to the receiving party.
· Commercial Invoice
In the Commercial Invoice, you’ll find the order value, the types of products, and the consignee. This is the document that customs use to determine the true value of the goods to assess the custom duties for the goods.
Some other documents you may need include Bill of Lading, Air Waybill, Consular Invoice, Customs Declaration Form, Quarantine Packing Declaration, Weight Memo, etc.
What are the shipping methods to choose from when you ship from China?
Whatever the cargo you want to ship from China is, you have nothing to worry about. All you have to do is contact Winsky Freight to get started. We offer a wide variety of reliable and efficient shipping methods for different kinds of shipments from China to various regions in the world. These include:
If you are shipping from China to any country in the European Union, you will have the same import duty rates in each country. The rates, however, differ from product to product and range from as low as 0% on consumer electronics to 12.4% on peanuts. Value Added Tax is compulsory for all freight that comes into the EU from China and information on how customs value is calculated is available here.
Besides the declared value of the shipment, the HS Codes also influence the import duty on the shipment from China. The HS Code is used to classify different types of products and it is found on the Commercial Invoice. When you have the correct HS Code for your freight on your Commercial Invoice, you will be appropriately charged the import duty rate for that product based on the shipping destination country’s rates.
What the particular shipping destination country is will determine how much the import duty on your shipping from China will be. This is because each country has its own taxes and rates for import duties and how they calculate the customs value of the freight being shipped. Another crucial factor that affects the import duty from China is the HS Codes (Harmonized Commodity Description and Coding System) of the freight.
Some helpful tips when you are shipping from China
· Choose the best freight forwarder
Your ultimate aim is to make your international shipping easy and smooth. When you have the best freight forwarder managing your logistics and shipping requirements, you won’t be worried about whether to go for Ex Works, Free On Board agreements for your shipping from China because you will get expert and trusted advice on the best shipping solutions for your own business. The conditions that are most favorable for you based on your needs and business scale will be at the forefront of your freight forwarder’s mind so that you can get the best deal.
The difference between having a good freight forwarder help you with the complicated process and not having one is like night and day. Get started today by requesting a quote.
· Plan ahead
The peak seasons for shipping are from Mid-August to Mid-October, and from January to February. So, if you can, endeavor to avoid shipping during these periods because prices are usually high due to increased demands, reduced supplies, scarce containers, etc. Planning ahead will help you do your business during the off-peak periods so you can save as much cost as possible and meet your market demands.
· Consolidate your cargo
Consolidation of cargo means bringing together various consignments that you have from various suppliers into a single full container shipment. It is a process that minimizes the risk of damage to your freight, saves cost, and promotes standard quality control supervision, amongst others. Winsky Freight is a leading agent in freight consolidation.
Take advantage of the best – Winsky Freight
Now that you know the things involved in the process of shipping from China, you are better positioned to work with a reputable and experienced freight forwarder in China like Winsky Freight to meet your professional shipping needs. Get in touch today!