Importations Archives - Excelsior Worldwide Logistics Corp.

5 Steps To Save When Importing From China

excelsior on October 15, 2018

In 2017, China replaced Japan as the top bilateral trading partner of the Philippines with a 20.7% increase in imports from 2010.

This 2018, the imports shoot up to 51.2%, which is more than twice as it was last year. The said imports include electronics and machinery, mineral fuels, iron and steel, plastics, vehicles, ceramic products, furniture and lighting, and paper among others. No wonder why many businesses, whether big or small, import from China. If you’re one of them, here are five steps to help you reduce your expenses:

Plan ahead of time

China is 3,096 kilometers away from the Philippines, which means that the importation of your goods will likely take five days or more, depending on the mode of transportation. Although you can request for faster transportation, you will be asked to pay for a rush fee.

If you want your goods to arrive on-time without the extra charges, it’s better to plan it in advance. Moreover, it will also give you more time to find a local freight forwarder that will assist you throughout the importation procedure.

Find a local freight forwarder

Most freight forwarders in the Philippines are affiliated with numerous international transport organizations and companies worldwide, including local Chinese logistic companies. Hence, you should choose a freight forwarder that can and will use its connections to negotiate for better prices on your behalf.

Furthermore, your chosen freight forwarder should also be knowledgeable about the freight peak seasons in China (e.g., Chinese New Year) because during peak seasons, importing can become complicated due to high demand, high prices, and a probability of container shortage.

If this is a no-brainer for your local freight forwarder, you’re in the right hands. Knowing the peak seasons beforehand will help you save by importing non-urgent goods during regular seasons and avoid struggling to find a container spot during peak seasons.

Choose a suitable transportation method

You can import either by sea or by air. Sea freight is ideal for large shipments that aren’t urgently needed. On the other hand, air freight is suitable for smaller and lighter shipments that are time-sensitive.

Importing by air is more expensive than importing by sea because it’s faster and more secure. It goes through fewer hands, therefore minimizing the risk of damages and theft. To cut back on expenses, use air freight only if its necessary.

Another option that you could try is splitting your shipments. For instance, if you have one hundred boxes of imports wherein thirty boxes need to be delivered immediately, and the other seventy aren’t, consider putting the thirty on a plane and the rest on a cargo ship.

Although split shipments might seem inconvenient because it involves preparing two invoices, packing lists and handling charges among others, once you already have a local freight forwarder, it will be hassle-free because they will assist you in accomplishing the necessary paperwork.

A friendly tip: When importing by air, it is best to book six to seven days in advance of the Cargo Ready Date (CRD) while when importing by sea, consider booking three to four weeks ahead of the CRD.

Ensure proper product packaging and insurance

Proper packaging reduces the risk of product damage and loss while in transit (especially fragile and perishable products), whereas cargo insurances can be converted into cash claims in case of damage and loss.

Although the proper packaging and cargo insurances might seem more like spending than saving, neglecting them will cost you a fortune in case your goods get damaged or lost. Better safe than sorry, right?

Obtain rates with the lowest GRI (General Rate Increase) possible

General Rate Increase is the adjustment of container shipping rates and is only applicable when importing by sea.

General Rate Increase and demand are directly correlated. When the demand is high, the GRI also goes up and vice versa, which means that GRIs go up during peak seasons.

The good news is, if you followed the first four steps mentioned earlier, especially planning ahead of time, you will be able to choose between multiple ocean freight rates and obtain the lowest GRI even during a peak season because as the saying goes ‘the early bird catches the worm.’

These five steps only prove that there are always ways to save when you are determined to look for them.

Here at Excelsior Worldwide Freight Logistics, we have equipped people who are knowledgeable regarding import procedures and are committed to reducing your expenditures as much as you are.

We also conduct free orientation for those who are willing to learn about importation & exportation. It is our advocacy to share our knowledge & experience for 17 years in the business.

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Why Importers Choose Freight Forwarders Over Shipping Lines (Infographic)

excelsior on June 23, 2018

For the past years, freight forwarding companies have been doing good in the world of logistics, wherein most of the importers right now is choosing to use the service of Freight Forwarder rather than choosing the service of Shipping Line.

In order to understand why more and more importers rely on the service of freight forwarding companies, we detail in this infographic the biggest advantages that freight forwarders have over traditional shipping lines.

1. Flexibility

Freight Forwarder could be more flexible in terms of quality service and rate which is very critical for importers these days. Instead of going directly with the shipping line, a freight forwarder will negotiate on your behalf to get a competitive deal and discover the most suitable arrangement for your shipments.

2. Service

A freight forwarder is a total logistics provider, which means that an importer can access a wide variety of services more conveniently. Freight forwarder could offer different types of Incoterms depending on what arrangement of importer wanted to do.

In fact, there are shipping arrangements that a freight forwarder could offer to a budding importer that a shipping line cannot, such as such as Ex-Works and Air Freight. Lastly, freight forwarders provide brokerage services which are a critical aspect when running a legitimate importing business.

3. Rate

Of course, a freight forwarder will still use the service of a shipping line to transport the goods since they do not have their own vessel to do so. However, to make their rates more competitive than shipping lines, freight forwarders use the extreme competition in shipping line industry as leverage. They do this by proposing rates to all shipping lines instead of using only one shipping line, allowing them to charge the most cost-effective rates to their customer more effectively.

4. Reliability

One of the hardest parts on the side of importers is the communication. Most importers – especially those that are new in the business – can testify how hard to contact shipping line and how inconsistent their service when it comes to updating the arrival details of their shipment.

On the contrary, freight forwarders are known in the industry as reliable service providers. They can come up with solutions on-the-go be it for harsh weather, customs errors, inaccessible routes, vehicle breakdowns, and other problems that could arise and delay the transport of your shipment.

5. Contract Agreement

A reliable and trustworthy freight forwarder could get not only the best and most competitive rates but other cost-privileges such as Demurrage, Detention, Ocean Freight, Credit Term and ability not to be affected by General Rate Increase.

By choosing to work with a freight forwarder, you will also be able to choose from a wide variety of shipping line options. They know where to load best in terms of your need/demand. It’s either low rate or transit schedule. You can also enjoy the service contracts/agreements they have with different shipping lines in terms of extended free time and waive of unnecessary charges, thus helping you lower your overall importation cost.

Excelsior Worldwide conduct free orientation for those who are willing to learn about importation & exportation. It is our advocacy to share our knowledge & experience for 17 years in the business. Visit our website today at www.excelsior.ph to learn more about our service.

Is Your Importation Considered as De Minimis Importations and No Longer Subject to Duties and Taxes?

excelsior on May 26, 2017

If you’re a business owner looking for ways to minimize importing cost, then you should familiarize yourself with one of the salient features Customs Modernization and Tariff Act (CMTA) which was implemented October last year.

Under Customs Administrative order no. 02-2016, De minimis provision of the CMTA is implemented which states that imported goods in the Philippines with a freight on board (FOB) or free carrier (FCA) value of P10,000 and below are no longer subject to duties and taxes.

This said provision aims and targets to 1) minimize the importation costs and customs administration costs of clearing such importations, without compromising customs border enforcement patrol and; 2) adapt the growing trend toward trade liberalization and facilitation and harmonize the country’s customs laws with different applicable international trade agreements.

Here are some facts one needs to know in order to assess whether your importation might be free of duty and taxes.

a.) Importations brought in by passengers or sent thru balikbayan boxes may be considered as de minimis when they have complied the parameters of Conditionally Free Importations.

image from rappler.com

b.) Importations under such, is still needed to be lodged and processed.

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c.) Random and non-intrusive examination will be conducted but customs examiners may also physically examine and inspect the goods in order to prevent the entry of contraband goods.

image from taiwantoday.tw

d.) Tobacco, wines and spirits are still subject to excise tax even if its value falls within the de minimis value.

image from techfactslive.com

e.) Tobacco and liquor products exceeding the allowable limits carried by passengers but within the limits of the de minimis value are also excluded.

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f.) Shipments which are declared as “without commercial value” or “of no commercial value” are excluded from immediate release as de minimis importations.

image from uthandoproject.org

g.) Goods that needs import permits, licenses, requirements, and clearance are still needed to be complied with unless such is for personal use.

image from tanzania.co.zm

These are only several and important facts about the de minimis provision. The said provision will also be reviewed every 3 years and amended or revised, if necessary. Your shipment might qualify in this provision. For assistance, feel free to contact Excelsior Customs Brokerage where peace of mind of clients is our service.