sea-freight-shipping--product-sourcing-guide-import-from-china

How to Ship from China: An Easy Guide

we have written this easy to understand guide on China Sea Freight Shipping to avoid those mistakes that 90% of beginners make when importing from China. The majority spend most of their time on 

but spend very less time on China Sea freight shipping because of lengthy documentation and complex terms which can cost you damaged shipment and loss of time and money. Do not worry anymore as this article will clear all your confusion.

So let’s say you have decided to start your own business by importing products from china. You already found your dream product from a good supplier but have you ever wondered what happens next on Importing from China. the processes and paperwork involved? As we all know China has one of the fastest-growing economies where manufacturing and production are at its peak. People are constantly importing goods from china in fact; it can be term as a culture now.

Shipping from china gives you the opportunity to get unique products at low cost, as well as importing in large quantities and small quantities. It gives opportunity to both small and medium scale companies to import products. 

1.Who works in the background?

Procedure of International Logistics

procedure-of-international-logistics-shipping-china

If you are planning to perform the whole process by yourself then it is vital to know the players involved in the background. International logistics deals with planning and managing of shipment and timely delivery. It is the supply chain that shows how goods are transferred from one point to the other until it gets to the final buyers.

 Major Players in International Logistics

  1. Shipping Company
  2. Freight Forwarding Company
  3. Customs Clearance Agents / Lawyers 

1.1 Shipping Company

The shipping company handles the shipment of products from point A to point B. They are helpful, stress-free and have no constraints in shipping the products to any specific location.  

  • Helpful

They have expertise in the department of sea freight shipping because of years of work. They take care of the whole process of organizing products for shipment.

For example, Some of your bought products could be heavier than the other. They along with your hired sourcing company make sure that your products/goods are loaded into the shipping container to avoid any damage. The unbroken products (let’s assume your product is pizza packing boxes) are placed at the bottom while lightest at the top which can help in saving your products and money on packaging.

  • Stress-Free

The shipping company provides a stress-free atmosphere. Different ports have different functions and rules which affect the total pricing. 

China is a big country with respect to the area. One of your suppliers is in Beijing and another one is from Shenzhen. choosing the right port could be crucial as you may have to pay for trucking service to deliver products to your warehouse. 

so If you are a beginner, one small miscalculation could affect the landed products.

ports-sea-freight-shipping--import-from-china
  • No constraints on shipping location

One of the main reasons that most of the businesses choose Sea Freight Shipping in China is that it is cheaper and there is no restriction of sending goods to any delivery address. Some shipping companies even provided services of delivering the shipping container straight to the door of your warehouse.

1.2 Freight Forwarding Companies

Freight forwarding companies are like a travel agent except that they deal with the shipment of products rather than passengers.  A freight forwarder is an individual who deals with the organizing, prepares the shipment for loading, arrangement products to move the product from the production factory to your given address. They are term as the middlemen in sea shipping.

Freight forwarder makes plans for the most appropriate route for a shipment, putting into consideration the nature of the shipment been transported, cost, time and safety. They mostly involved in Packaging of the products, Labeling the products and other documentation.

1.3 Customs Clearance Agents / Lawyers

Customs clearance agents/lawyers are the bridge with sea shipping companies and government agencies. They ensure that a shipment meets all agreements with your country’s trade laws and regulations. They prepare and submit documentation that enables them to acquire freedom from government organizations.

You can find information about the customs clearance of your country from the following links:

2. What trade terms used in shipping from China?

What are Incoterms or trade terms?

One problem that many buyers face is the unknown terms when importing from China after product sourcing. Lack of knowledge results in a lack of interest which could mean damaged shipment.

Incoterms are rules governing trades. Shipping incoterms are a set of rules and regulation which are meant to keep buyers and sellers in check. They give buyers and sellers a sense of responsibility for the delivery of goods under the contract.  They are exchange terms that are being assigned by the International Chamber of Commerce (ICC). These terms are normally utilized in worldwide and domestic exchange contracts.

The common incoterms used in sea shipping, they include:

 Major Players in International Logistics

  1. CFR Shipping (C&F Shipping)
  2. CIF Shipping
  3. FOB Shipping (Free on Board)

2.1 C&F Shipping / CFR Shipping

The supplier is liable for the products and pays for the delivery of the cargo till destination port when you use CFR Shipping. Once the goods have reached their specified destination then the liability of the goods is transferred to the buyer. At this point, any damage happens to the cargo is on you. 

Seller vs Buyer Liability

Seller (Supplier)

  • Prepare Documents, Arrange Delivery of goods and mailing of documents
  • Takes care of hectic customs clearance process and pay duties
  • Arrange Booking of the carrier and pay challan for the sea freight carrier.
 
  • Responsible for any damage before your goods surpassed the point of the loading port

Buyer (You)

  • Transfer money for the bought products to get the customs clearance documents. Picks up goods.
  • Takes care for the customs clearance by paying import fee/duties if applicable
 
 
  • Takes care of Insurance
  • Responsible for any damage after your goods surpassed the point of shipment port

2.2 CIF Shipping

CIF abbreviates to Cost, Insurance and Freight. This is an all-expense paid shipping where the seller covers the cost, insurance, freight and damage that might occur till the destination port which is mentioned in the sales contract. Once the freight loads off at the port of destination then the buyer becomes responsible thereafter.

Seller vs Buyer Liability

Seller (Supplier)

  • Prepare Documents, Arrange Delivery of goods and mailing of documents
  • Takes care of hectic customs clearance process and pay duties
  • Arrange Booking of the carrier and pay challan for the sea freight carrier.
  • Takes care of Insurance
  • Responsible for any damage before your goods surpassed the point of the loading port

Buyer (You)

  • Transfer money for the bought products to get the customs clearance documents. Picks up goods.
  • Takes care for the customs clearance by paying import fee/duties if applicable
 
 
 
  • Responsible for any damage after your goods surpassed the point of shipment port

2.3 FOB Shipping (Free on Board)

F.O.B implies Free On Board. FOB deals with shared responsibilities between buyers and sellers. In FOB shipping, the seller is responsible for transporting the goods to the shipping port and also pays for the load of the shipment in the vessel while the buyer is responsible for payment for freight transportation from the seaport to the final destination. It shows when obligation and possession are moved from buyer to seller.

Seller vs Buyer Liability

Seller (Supplier)

  • Prepare Documents, Arrange Delivery of goods and mailing of documents
  • Takes care of hectic customs clearance process and pay duties
 
 
 
  • Responsible for any damage before your goods surpassed the point of the loading port

Buyer (You)

  • Transfer money for the bought products to get the customs clearance documents. Picks up goods.
  • Takes care for the customs clearance by paying import fee/duties if applicable
  • Arrange Booking of the carrier and pay challan for the sea freight carrier.
  • Takes care of Insurance
  • Responsible for any damage after your goods surpassed the point of shipment port

3. How to make decision on shipping container?

LCL vs FCL and container measurement for shipping

  1. Less Than Container Load (LCL) Shipping
  2. Full Container Load (FCL ) Shipping
 
shipping-container-import-from-china

Understanding of shipping containers dimension is important when buying your products from china. You will know how to find the right quantity to order when you know CBM(cubic meters) volume so that you don’t leave your products back in China ending in delay means avoid loss of money and space. you should be aware of the various sizes of containers that are available to you. If you do not how to calculate cbm then below is a reference. 

 
cbm-calculation-china-import-shipping

Here is detailed information of container with the dimensions

You can utilize any of the accompanying distinctive container volume choices:

  1. FCL 20” Volume: 33.2 cbm
  2. FCL 40” Volume: 67.7 cbm
  3. FCL HQ 40” Volume: 76.3 cbm 
FCL 20” Volume: 33.2 cbm
Dimensions: 5.89m x 2.35m x 2.39m 
Maximum Load: 24 tons
Cargo Gross Load: 18 tons
 
FCL 40” Volume: 67.7 cbm
Dimensions: 12.03m x 2.35m x 2.39m
Maximum Load: 30.48 tons
Cargo Net weight: 26 tons
 
FCL HQ40” Volume: 76.3 cbm
Dimensions: 12.03m x 2.35m x 2.69m
Maximum Load: 30.48 tons
Cargo Net Weight: 26 tons

There is always going to be a slight difference between container volume amongst shipping companies. A lot of money can be saved by making your orders based on certain container sizes and not by deciding the quantity of the products in advance.

Doing this will allow you to avoid loss of cash and space especially when ordering FCL size containers.  

3.1 LCL Shipping (Less Than Container Load)

Less than container load (LCL) is a common term used in sea freight shipping. LCL enables small scale buyers and seller to import and export their products that mean it helps those individuals who are starting new and cannot afford full-scale container shipment to share space, cost and enhances growth.  

As the goods in the container are owned by different individuals means you should only be concerned with the total weight of your products.

less-than-container-load-LCL-shipping-container

3.2 FCL Shipping (Full Container Load)

Full container load is the type of shipment which is done with the entire shipping container. The goods have been exported or imported has the exclusive right to the container, under no condition will other goods be put alongside in the container. It does not necessarily mean the container has to be filled. In fact, the goods in the container are owned by a single individual or organization. FCL shipping is usually encouraged when shipping highly sensitive materials.

As the goods in the container are owned by different individuals means you should only be concerned with the total weight of your products.

full-container-load-shipping-container

4. What documents are required for customs clearance?

  1. Bill of Lading (B/L)​
  2. Commercial Invoice​
  3. Packing List

4.1 Bill of Lading (B/L)

Bill of Lading (B/L) is a document issued by a carrier to a shipper, this document clearly shows the type of product been transported, the quantity of product transported as well as the destination the good is to be delivered. It also serves as a shipment receipt when the product is delivered to the required destination. It can be termed as a legally binding document between the carrier and the shipper.

Which players are involved in the shipment of your goods:

  • The consignee of goods (you) and shipper
  • Carrier which issues the B/L
  • Freight forwarder origin
  • Destination of the freight forwarder
  • The individual that is paying for the transportation

the Bill of Lading is like a manual for products that are to be delivered and also the sensitivity attached to the material. 

  • Product details e-g: furniture: sofa, power cable, toys
  • What is the type of packaging used inside and outside product e-g: rolls, boxes, drums, etc
  • Identifying quality
  • What sort of Transportation method has been used/
  • Define instructions on how to deal with products
  • Weight and volume of the total payload

The information about carrier routes that it follows from source to its destination. 

  • Shipment starting point
  • Shipment destination
  • Route it follows from point A to point B
  • Shipping date
  • Which vessel your shipment will be loaded.

4.2 Commercial Invoice

The commercial invoice consists of the following

  • Product names
  • Specification Quantity 
  • Sensitivity of material 
  • Unit price
  • Total amount 

It serves as clearances at custom checks and points, also tax clearances for goods that arrived showing that all custom related issues have been cleared. It serves as proof of the transaction between buyer and seller. 

4.3 Packing List

The packing list gives comprehensive details of all the products that are been shipped. In sea shipping, the packing list gives a summary of goods transported both in quantity, specification and volume. It is used by the importer and the customs to inspect and verify the goods.

 It is important to note that the data on the package list must conform to that of the bill of lading in all necessary aspects.

5. What are top shipping ports in China to ship your products?

Most used shipping ports in China

ports-sea-freight-shipping--import-from-china

Shenzhen: Yantian Port, Shekou Port, Dachan Bay Port, and Chiwan Port

Shanghai: Yangshan Deep Water Port & Waigaoqiao Shipping Terminals

Qingdao: Dagang Port Area and Qianwan Container Terminal

Guangzhou: Xinsha Port Area, Nansha Terminal, Downtown Port Area and Huangpu Port

Tianjin: South Port, East Port, and North Port

Ningbo: Port of Ningbo-Zhoushan 

Dalian: Dayaowan Port

Conclusion

What steps you should take consider when importing from China?

We tried our best to give you the best understanding of the whole china sea freight shipping procedures. Yes, the process is hectic and requires a lot of time but it isn’t impossible if you know the terms and language skills. In doing so, you will learn the whole process which will ease up your future business in China. 

However, if you have no time to go down to this road and do not wish to take any risks then hire someone to take away your stress.  

If you have any questions then leave a comment or contact us and we will answer them soon. 

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