Once you have decided on the list of products to buy from your various manufacturers and suppliers in China, the next question that often comes to mind is how to minimize your international shipping costs. This is to ensure that you can continue to maximize your product profit margins once the goods have arrived in your destination country.
Here is a guideline on how you can save on freight costs when shipping internationally from China:
1. Consolidate Goods from Multiple Suppliers into a Single International Shipment
Each international shipment comes with own set of base charges. Furthermore, the larger an international shipment, the lower the per unit shipping cost. Therefore shipping multiple shipments separately from your different suppliers will greatly increase your shipping costs. It would therefore make more economic sense to have them all consolidated into a single international shipment via a freight forwarder like CNXtrans before shipping internationally from China.
2. If the shipment is large enough, ship by Sea or Rail (train)
For large shipments, shipping by sea or rail is certainly going to cost a fraction of what it would cost to ship by air. The larger a shipment, the larger the difference in costs between shipping by air and shipping by sea/rail. At the same time, the shipment will take longer to arrive (usually at least a month depending on where you will be shipping to) but as long as you plan your shipment in advance, the longer wait will save you a huge amount on shipping costs. Generally speaking, if a shipment is at least 100kg or more in chargeable weight, it would make more economic sense to ship by sea or rail if you have the option to do so (this may also depend on which country you are shipping to).
3. Avoid Shipping Large, Bulky and Heavy Items
International shipping costs are charged based on the weight and size of your goods and not on how much they cost. Therefore, regardless of how cheap or expensive they they are, given the same weight and volume, the goods cost the same to ship. Therefore, unless we are talking about valuable high value goods, it is generally best to avoid excessively heavy, bulky and large items as these would cost a lot more to ship from China than light and smaller items. In fact, the best way to minimize shipping costs as a proportion of your overall costs when sourcing goods from China is to buy high value items (with big potential profit margins) which are both light and small. This way, shipping would only be a small portion of your overall costs.
4. Choose DDP Door to Door Shipping (for shipments of 2,000 kg or under)
DDP Shipping refers to shipping with 'duties and delivery paid'. This means that the entire shipment will be fulfilled for you on a door to door basis with customs clearance, customs duties and delivery to your address all taken care of for you. This saves you the hassle of having to look for a customs broker, pay customs duties, acquire an import license (in some cases) and paying destination port fees. Generally speaking, for shipments of 2000kg or under, DDP sea freight shipping would end up costing less than shipping on an LCL basis to port.
This is because when you ship to port, although the upfront shipping costs that you will have to your forwarder in China may be lower, you face the uncertainty of not knowing how much the destination port fees and customs duties will be until the shipment has actually arrived at the destination port, and this can often end up costing a substantial amount, in some cases even more than the shipping itself. When you ship by DDP on a Door to Door basis, you pay for all the costs to your forwarder in China upfront - due to economies of scale, DDP shipping if often cheaper overall than shipping to port. Shipping to port typically only begins to make economic sense once the shipment is larger than 2000kg, where the shipment may even be large enough to fill an entire container.
5. Choose a Freight Forwarder that is actually based in China
When shipping internationally from China, it may often be tempting to use a freight forwarder from your own country to reduce communication and payment barriers. However, this typically ends up being more expensive for you because these freight forwarders in your destination country cannot actually fulfill your shipment for you directly. Instead, they will then need to look for a freight forwarding partner in China they can outsource your shipment to, pay the China freight forwarder, and then mark the shipping costs up when they charge you in order to ensure they can make a profit from the shipment.
Instead of paying this premium for shipping, why not look for a freight forwarder like CNXtrans that is actually based in China? While CNXtrans may be based in China, it has an entire department that is catered specifically with dealing and communicating with international customers in English. CNXtrans also has international bank accounts in USA, UK, Europe, Australia, New Zealand and Singapore to ensure ease of payments in their local currency for customers all over the world.
Looking for a China-based Freight Forwarder to help you ship Internationally from China?