There are many factors to consider when transporting goods from one part of the world to the other. First, you must ensure that all documentation is in order. This includes things like manifests, bills of lading, and other paperwork required by the country of origin and the country of destination. Second, you must be aware of and comply with all import and export laws. These laws can vary significantly from one country to the next, so it is important to do your research and make sure you are following all the required regulations. Finally, you must choose the right mode of transportation for your particular cargo. There are many options available, including air, land, and sea transport, and each has its own advantages and disadvantages. Ultimately, it is important to plan carefully and make sure you are taking all the necessary steps to ensure a smooth and successful shipment.

How the Shipping Process Works, Step-By-Step

Step 1: Importer requests quotes and orders goods

• • • • • Agreeing on shipping incoterms
        • Engaging a freight forwarder
        • Obtaining a Letter of Credit
        • Issuing of Commercial Invoice

Step 2: Freight forwarder arranges export

• • • • • Documents that need to be prepared by the supplier
        • Documents that need to be prepared by the buyer

Step 3: Booking of freight

 

Step 4: Goods to travel to international depot.

 

Step 5: Goods processed through export customs clearance and placed in transit

 

Step 6: Goods arrive in buyer’s country for import clearance

 

Step 7: Goods are transported from the port to the buyer

 

1.Importer requests quotes and orders goods

The first step in the shipping process is when an importer requests goods from a supplier. If a goods order is placed by a buyer, they’ll request goods to purchase and that’s when the supplier will provide them with an invoice based on their price list, if they have one; or they could just quote the client on the spot. Documentation of this kind of transaction is known as packing list affidavit or a Packing List Declaration and in certain cases, it could be in the form of an official document such as Customs Entry Procedures.

There are lots of ways to do business with importers. Sometimes you could just drop a quote and go, and just wait for the importer to respond with the order, sometimes it could take you a long period of time, even months. It depends on the importer. In my experience, it’s always a good practice to drop a quote and offer samples. For example, the importer required samples from our company and the samples arrived the next week. We shipped the samples, then we got an order for the same amount with their terms and conditions. We renegotiated the terms, and shipped them the order. Sometimes it takes you a long time to start business with them, if they need a lot of things to be negotiated, it’s reasonable.

 

Agreeing on shipping incoterms

Incoterms are not set in stone. They are guidelines, so they are designed to be interpreted differently by different sellers. I agree that Incoterms are not the sole decider of who pays for shipping. Ultimately, “who pays” should be discussed between the buyer and the seller to find the best solution for both. However, there are other factors to take into consideration (e.g. the customs and tax information set forth by each country), so if you know this information in advance, it might save you from an expensive surprise.

 

Engaging a freight forwarder

Freight forwarding is one of the essential services for international traders, especially for those people who have to export and import their goods on a regular basis. It is important to choose a right freight forwarder who is experienced and capable of satisfying all your shipping needs to your destination country.

 

Obtaining a Letter of Credit

A buyer may need a Letter of Credit (L/C) from a bank before making payments for imports from your foreign supplier. A Letter of Credit is a document issued by a bank that protects the importer. It ensures that the exporter will receive the money for the commodity that he was supposed to supply. The process of obtaining a Letter of Credit is quite complicated if you are not familiar with the process. So, it is always better to get a third party assistance for the same.

 

Issuing of Commercial Invoice

Commercial invoice is the value added tax (VAT) invoice issued based on the value of goods you purchased. VAT is a tax that is imposed on goods and services sold in your country. This tax is then paid by the buyers, instead of deducting it from the seller’s sales price. There are certain rules and regulations that you must follow before issuing a commercial invoice. You must charge VAT on invoices that are issued to you during the tax period. The VAT charged is usually the tax applicable in your country.

 

2. Freight forwarder arranges export

Freight forwarders arrange export, moving goods like consumer, industrial products and sometimes even legal shipments from one place to another. They are the companies who find the shippers for the clients, who then carry the goods to the destination. Freight forwarders do not take possession of the goods. Freight forwarder is the company that arranges transportation service.

 

Documents that need to be prepared by the supplier

• 1. Detailed cost estimation
  2. Detailed technical drawings and specifications
  3. Commercial proposal
  4. Payment schedule
  5. Sample Certificate
  6. Material Declaration Sheets
  7. Material Failure Investigation (MFI) Reports
  8. Address and contact details of the manufacturer
  9. At least five years history of the manufacturer – List of customers, quantity delivered to each customer, and the value of each project.
  10. Manufacturer’s Certificate of Origin

 

Documents that need to be prepared by the buyer

1· the sales order and the bill of sales with the original notarized signatures,

2· the certificate of origin with the original notarized signature,

3 · the import permit,

4· the packing list,

5· the insurance policy,

6 · the certificate of origin,

7· the bill of lading,

8 · the CMR,

9 · certificate of origin

10· the certificate of quality.

 

3: Booking of freight

When booking Freight, you would have to deal with local freight forwarders, freight consolidators, ocean freight forwarders, air freight forwarders, etc. These freight companies can be found in almost all major and metropolitan areas. When dealing with freight forwarders, some of the important factors are to identify a freight forwarder that has a global network. This will only make your shipping process easier instead of having to contact multiple freight forwarders for one shipping transaction. It is also important to identify what type of forwarder is the best suited to your needs. In some cases, the freight is consolidated, but then shipped forward to a final destination. When shipping freight, you may want to see if you can ship your freight via ocean freight or air freight. Each shipping method has its own benefits, and when dealing to get what’s most suitable for your product, personal needs, and budget.

 

4: Goods to travel to international depot/port

When your goods are being shipped to international depot/port, you might need to tell the following information to the delivery company: – Name of the international depot/port – Collection time – Signature required – Customs Broker’s account number – Warehouse  number, name and contact detail – Collection account number and contact detail

 

The Bill of Lading

A Bill of Lading is a document that holds all of the details of the transaction between the shipper and the person accepting the goods. The Bill of Lading is a contractual document, so it actually helps the shipper, the person accepting the goods, and any companies involved in the process by keeping everyone on the same page.

 

5: Goods processed through export customs clearance and placed in transit

Goods processed through export customs clearance and placed in transit may be deposited in bonded warehouses without payment of duty. These goods may be entered in the bonded warehouse only after clearance by customs of the original goods. The following goods may be deposited in export bonded warehouses upon submitting required documents and paying the duty at the point of entry:

6: Goods arrive in buyer’s country for import clearance

Goods are shipped from the seller’s country to the country where the buyer resides. The seller and the buyer may be from the same country. The goods are cleared from the port of entry and then forwarded to the buyer’s address. Upon the arrival of the ordered goods, the buyer should contact the seller. The seller is required to obtain a proof of delivery. The delivery is usually, but not always, with a tracking number which allows the buyer to see the location of the goods. This process is often done by an international shipping company. The buyer pays the shipping costs, insurance and any other extra costs including taxes.

 

7: Goods are transported from the port to the buyer

From the port to the buyer, goods are transported in containers or trucks. It depends upon the seller whether the transportation is carried out using containers or trucks. Goods are transported using containers if they are being exported. Containers are provided by the shipping company and are used at the destination too. The containers have the same number and code at both the places. So, it becomes easier to track the goods.

 

Conclusion

In order to manage your shipping effectively it’s important not to forget about the above things and include them when estimating your shipping timeline. It’s very easy to drop these key factors out of your calculations which could result in inaccurate predictions.

If you are still unsure about any part of the shipping process, or if you’d like to know about the import or export of a specific product, then feel free to get in touch with our reliable ICE team by filling out this short form detailing what aspects of importing or exporting concern you and we will have someone jump on it right away.

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