Over the past year, global supply chain disruptions, port congestion, capacity shortages, rising ocean freightrates and the ongoing pandemic have created challenges for shippers, ports, carriers and logistics providers.
Looking ahead to 2022, experts estimate that pressures on global supply chains will continue - with the light at the end of the tunnel not appearing until the second half of the year at the earliest.
On top of that, the consensus is that the pressure on the ocean freight market will persist in 2022, with freight rates unlikely to fall back to pre-pandemic levels. Capacity issues and congestion at ports will continue to be combined with strong demand from the global consumer goods industry.
German economist Monika Schnitzer expects the current Omicron variant to have a further impact on global shipping times in the coming months. "This could exacerbate an already existing delivery bottleneck," she warned. "Transit times from China to the US have increased from 85 days to 100 days due to the Delta variant and may increase again. Europe is also affected by these issues as the situation remains tense."
Meanwhile, the ongoing pandemic has sparked a standoff at major ports on the U.S. West Coast and in China, meaning hundreds of container ships are at sea awaiting berths. Earlier this year, Maersk warned customers that wait times for container ships to unload or pick up at the port of Long Beach near Los Angeles were between 38 and 45 days, with restrictions expected to continue.
You are an exporter and want to expand your business globally, but sometimes you feel like you\may have hit the iron ceiling of your business? Many business owners encounter this problem at various stages of their business. If you are considering the possibility of exporting your goods worldwide, you should go ahead. In this article, I will outline how to expand your business globally in 2022.
Step 1: Assess the market
Evaluate your target market as it is important to summarize and understand the content of your business analysis before going global.
Step 2: Business Objectives and Strategic Blueprint
Each market has different nuances due to market trends, culture, needs, and government regulations. Therefore, an analysis of business goals, objectives, needs, and success metrics is very important.
Step 3: Stock Inventory
Always take the unavoidable steps, and the inventory should always be ready and updated. Your product enables high-impact product differentiation.
It is necessary to choose your freight forwarder wisely, as freightas the best way to ship your goods, freight, insurance cargo, customs clearance, etc. has many hassles.
"Shiptos, the one-stop solution for all your logistics needs. It's a fully digital freight forwarder where you can get instant quotes for free, multiple options to ship your products, track your shipments, clear customs and insure your shipments."
Step 5: Sell the product
Now, the final step is, once your product reaches its destination, sell your product according to the strategy.
My point:
Take it one step at a time and don't get overwhelmed. But, take it seriously. Whatever you choose, don't rush it. Know what you are doing. Do additional research, learn about best method practices, test several methods and always analyze your results.
The International Commercial Terms Rules are official terms published by the International Chamber of Commerce (ICC) and are widely used in international commercial transactions or procurement processes. They are well thought out, standard, globally accepted and complied texts that determine the responsibilities of consumers and traders to deliver goods under contracts of sale in global trade. Incoterms are closely related to the United Nations. Convention on Contracts for the International Sale of Goods. Incoterms are known and implemented in all major trading countries.
According to Incoterms rules, Ex Works (EXW) means that the seller has fulfilled its responsibilities when the goods are normally provided to the buyer at the seller's destination. The seller shall package the goods properly or as specified in the mutual agreement. The buyer is responsible for everything necessary to load the goods in transit and to get the goods to their final destination. Risk or responsibility for the goods passes from the seller to the buyer when the goods are available at that location. This means that the buyer is at risk if the goods are damaged in any way while the buyer is in transit, even if the seller assists with loading. Precautions should be taken.
Free Carrier or FCA is a trade term that states that the seller of goods is responsible for delivering those goods to the destination specified by the buyer. When used in trade, the term "free" means that the seller must deliver the goods to a designated location for transfer to the carrier. Considering that the carrier is nominated by the buyer, the shipping costs under the FCA terms are paid by the buyer. The seller arranges for the goods to be loaded onto the carrier nominated by the buyer.
The seller is responsible for delivering the goods at its location. In this case, it is the seller's responsibility to load the goods on the buyer's means of transport and for delivery to the port and export clearance, including security requirements. Risk transfers once the goods are loaded onto the buyer's means of transport.
Carriage Paid to or CPT means that the seller delivers the goods to the carrier or a person designated by the seller at the agreed place, and requires the seller to sign a contract of carriage and pay the agreed freight for delivery of the goods. The seller must go through the export procedures and the buyer must go through the import procedures. But the seller is not responsible for purchasing insurance.
Carriage and Insurance Paid To (CIP) is similar to CIP with one important difference. Risk passes to Buyer when Seller clears the goods for export and delivers them to the carrier or another person designated by Seller at the place of shipment. This Incoterms rule requires the seller to take out maximum insurance for the buyer - at least 110% of the value of the goods covered by the ICC (Institute Cargo Clauses) (A) or (Air) or similar clauses to cover the buyer's risk. Seller must provide Buyer with any insurance documentation required by Buyer in case it must file a claim under that insurance.
Delivered at Place or DAP, this incoterm rule can be used for any shipping method. An extension of DAT, the seller delivers the goods at the destination specified by the buyer, although under ICC rules the unloading of the goods is the buyer's responsibility. The buyer also needs to sort out duties and taxes, as well as clear the goods through customs.
Previously named Delivery at Dock or DAT, this Incoterm has been renamed to Delivery at Unloading Point (DPU) as the buyer or seller may require the goods to be delivered elsewhere. The term is often used for consolidated containers with multiple consignees, and this is the only term that requires the seller to unload. The seller clears the goods for export and assumes all risks and costs involved in the delivery and unloading of the goods at the named port or terminal at the destination. Buyer assumes all costs and risks from then on, including customs clearance of imported goods at the named destination.
Delivery After Tax, or DDP, works very similarly to DAP, with one most important difference. Seller must import customs clearance goods in buyer country and pay any duties and VAT/GST. DDP is a risky clause for sellers as they may not be aware of import customs clearance procedures at the import destination. Its value is also uncertain for importers, who must rely on sellers to successfully navigate the complexities of destination countries.
Why do you need a freight forwarder that provides it?
When transportingyour goods, whether by road, air or sea, there are various risks. Even with the assistance of a reliable freight forwarder, there are many external factors that can interfere with the progress of the logistics process.
The International Commercial Terms Rules are official terms published by the International Chamber of Commerce (ICC) and are widely used in international commercial transactions or procurement processes. They are well thought out, standard, globally accepted and complied texts that determine the responsibilities of consumers and traders to deliver goods under contracts of sale in global trade. Incoterms are closely related to the United Nations. Convention on Contracts for the International Sale of Goods. Incoterms are known and implemented in all major trading countries.
Guaranteed no financial loss
Everyone wants hassle-free shipping. No one wants to have problems shipping their goods overseas, but there are still some risks you can't avoid and can cause problems with your shipments. This is the most important reason why you need to rely on a freight forwarder who provides cargo insurance: they will ensure that you will not suffer any financial loss if anything happens in transit.
Prepare for the unexpected
When running a global logistics operation, you should be prepared for unexpected events throughout the operation. Whether it's inappropriate weather conditions or carrier issues that could cause your cargo to be lost, good cargo insurance will give you all the support you need in situations beyond your control.
Expertise in exporting/importing anytime, anywhere
In addition to the safety and financial reasons for hire cargo insurance, there is also the fact that some countries only allow import and export business to carriers who provide proof of cargo insurance. Therefore, insurance must be employed to be eligible to ship to these countries!
How to find the ideal cargo insurance for your logistics needs?
Each type of cargo insurance has specific coverage, and you should find the one that works best for your cargo. To determine the most suitable international freight insurance, it is recommended that you get the help of a freight forwarderwho can guide you through all the insurance options available and best suited for your export/import needs, such as TJ chinafreght.
First, we need to understand that different types of goods require different transportation measures. For example, products such as food, clothing, toys and home decor products can be easily packaged and shipped by air or sea without additional cargo handling work. Also, we should be extra careful when transportingdangerous and dangerous goods. Dangerous goods are goods and products that require special management to be packaged, palletized and loaded. In some cases, they require special machinery, equipment and containers to be transported safely. In short, dangerous products that may pose a threat to living things.
In this blog we will discuss hazmat - how to transport hazmat safely? Let's dive into it.
How are hazardous substances classified?
Since many daily necessities are considered hazardous, it can be difficult to determine if the product is dangerous. Products such as perfumes, detergents and paints. These are classified as hazardous materials.
Dangerous Goods Classification——
The United Nations Committee of Experts on the Transport of Dangerous Goods classifies dangerous goods according to the hazard they pose. Under this category, each substance is divided into a category. There are nine classes in total. Some are divided into a subcategory.
Why hire a freight forwarding partner who provides cargo insurance?
Some substances fall into two categories. In this case, the class with the highest hazard class belongs to the primary class, and the lowest class belongs to the secondary class.
Points to Remember
Knowledge about dangerous goods.
Follow the rules and regulations for dangerous goods.
Follow proper packaging procedures and protocols.
Do the required packaging according to the material.
Train shippers on the handling of hazardous materials.
Make sure the MSDS certificate and other documents.
Physically check labels, signs, markings for accuracy.
Fumigation is a form of pest control by which the disinfection procedure is carried out in a dry manner. This method, also known as phytosanitary treatment, is widely used today and is becoming more common in different market segments (especially when shipping goodsby container).
Why is fumigation so important?
Container fumigation procedures are designed to prevent foreign quarantine pests from entering the cargo. In this procedure, special products are used to eradicate or control the international spread of pests already present in the shipment.
You may be wondering what are quarantine pests?
Quarantine pests are any form of pests or parasites that, under natural conditions, cause damage to plants and animals in an area. These pests can pose a significant threat to international health when exposed to new environments. There are many types of quarantine pests, but none are as trivial as the Asian lady beetle. This beetle is commonly found in containers and woody materials used to hold loads. For this reason, it ranks among the world's worst-hit quarantine pests.
How does the container fumigation program work?
Container fumigation controls any type of pest through an efficient, safe and dry disinfection process, usually done with gas. The most commonly used gases in the fumigation process are methyl bromide and phosphine. While both maintain the same level of effectiveness, methyl bromide is more commonly used in containers. To receive fumigant, the container must be of good construction. The fumigation site must be isolated within a 5-meter radius, and a sticker containing basic information such as the start and end date and time of the treatment, as well as the information of the treatment company and technician responsible for the operation, must be affixed to the container door. The gas is injected through a probe inserted into the container. This process only happens when the door is closed. Appropriate protection of surrounding personnel must be provided with personal protective equipment, and collective protective equipment is recommended for fumigation sites. After the specified exposure time, aeration should be performed for commodity release.
What are the requirements for fumigation?
Do I need a fumigation certificate?
As you saw at the beginning of this article, any type of cargo and its wooden packaging can be refused entry into the destination country if not processed. To verify this, the Port Authority requires a written permit, certificate or other proof of processing. Therefore, every fumigation container, if done in the right way and by the right company, will be accompanied by a certificate. Fumigation is a legal requirement for the buyer, so a fumigation certificate is usually issued by the fumigator or approved for fumigation by a licensing body. This certificate, sometimes referred to as a pest control certificate, is a document confirming that any wood packaging material used in the shipment of goods has been properly fumigated. This document contains details such as purpose of treatment, fumigant used and temperature range.
How to Find a Heavy Equipment Shipping Partner You Can Trust
When shippingheavy equipment (or any cargo), working with a shipping provider you trust can have a profound impact on your experience. The right shipping partner will ensure that the entire process runs smoothly from start to finish, minimizing your work, stress, and often costs and any risk to your company.
When looking for a shippingpartner you can trust, it's easy to find and choose the wrong one.
Here are some suggestions to help you avoid choosing the wrong heavy equipment shipping partner:
Taking the time now to choose the right heavy equipment shipping provider will save you a lot of trouble
Not only look for trusted heavy equipment shipping providers, but watch out for those you don't trust.
Pay attention to the right details when vetting potential heavy equipment (and other freight) shipping partners.
Here is some information you should ask for during your initial conversation with any potential shipping provider:
Evidence of financial stability
Safety record
Insurance and authorities
Communicate
Cargo transportation knowledge
A reputable and trusted partner will have this information and be happy to order quickly. This is a major warning sign if a potential shipping provider asks questions, delays providing you with this information, or otherwise attempts to circumvent your request.
Hope you don't get lost if you choose the wrong heavy equipment shipping provider.
If you find yourself working with a shipping partner you cannot trust, then you must review your contract with them. Determine what your partner is contractually obligated to provide and be ready and willing to take legal action if necessary.
Then, look for a trusted shipping provider as soon as possible. Depending on the situation, the right partner may be able to help you with your current situation. At the very least, he or she will be able to prevent and mitigate any potential problems.
Deciding to ship your products internationally can be a tough one, but the chances of an ecommerce business reaching new customers and increasing revenue often outweigh the initial process required to set up.
But if you're still on the sidelines, it might be helpful to know that now, better than ever, it's better to start shipping goods overseas, as we see a dramatic increase in the global middle-class population. This opens up new markets that were previously inaccessible in places like Asia, Africa and South America.
Determining your shipping and fulfillment process starts with understanding your business model and target market. Do you ship directly to consumers, or sell to other businesses? Do you want to handle the details yourself, or would you rather work with an expert to resolve red tape and deal with customs authorities? Based on your answers to these questions, you will be able to determine what shipping arrangements are best for your company.
D2C, B2C or B2B?
What type of company are you? What do these three-letter options mean to you? If not, don't worry - we're breaking them down for you. It all depends on who you sell your product to.
Direct-to-Consumer (D2C)
- This is a popular choice for wholesaler companies. In this business model, middlemen are removed and customers buy directly from the manufacturer. Customers generally benefit from lower prices, so many choose to do business with D2C companies when possible.
Business to Consumer (B2C)
- This is the most popular e-commerce business model and is where a business sells products to a specific niche of customers. They don't make actual products, that's what differentiates them from D2C companies. Any consumer can order directly from their website, and the orders are usually small to medium.
Business to Business (B2B)
- If you are a business, manufacturer or distributor, and you sell directly to other businesses, then you have a B2B model. The typical consumer would not buy directly from this type of business, and the order size would be much larger.
Tips for reducing friction for you and your customers when shipping internationally
We like to think that where there is a challenge, there is a solution. We show you three inevitable hurdles you may encounter when you start shipping internationally. Now, here are some tips and possible solutions to overcome the potential challenges that international shipping can present.
Always ship DDP (Delivered Duty Paid) whenever possible - this removes the unpredictability of customs duties and duties in the destination country. And, as mentioned earlier, it offers your buyers an added benefit by adding a level of security and confidence, as they will avoid risks during shipping.
Negotiate discounts based on quantity whenever possible. Shipping rates are usually negotiable, so if you ship a certain quantity each month, you should be able to apply for a discount, especially if you can guarantee the same quantity each month.
If you can find a reliable and well-known logistics service provider, choose a regionally focused logistics service provider. Follow the tips we covered earlier and let a regionally focused freight provider handle the details for you. The time you save is money in your pocket.
Book with your freight forwarderearly in the shipping cycle. This allows you to secure space with the airline or shipping company as early as possible. This is critical, especially in the uncertain times we are in the COVID-19 pandemic.
The trucking industry is a multi-billion dollar industry that keeps our economy going. Without freight services, businesses and households would have nothing, from food to toilet paper. However, most people don't really understand how big the industry really is. What's more, big data is critical to helping the trucking industry overcome two huge problems - driver shortages and fuel costs, two major factors driving freight rates. Take a closer look at both areas through big data.
Truck Driving Job Data
The biggest thing we hear from trucking is a shortage of drivers. The number of trucking jobs needed in the U.S. is projected to increase by 2025 so far, but what about the employment of truck drivers? The number of trucking workers has grown from about 1.2 million jobs since January 2010, according to the U.S. Bureau of Labor Statistics. As of May 2018, an estimated 1.5 million people worked in the trucking industry.
Another key area to consider is the overall operating cost of trucking. In the trucking industry, trucking companies of all sizes get a share of the pie when it comes to freight costs. According to the National Transportation Institute, the cost of trucking includes:
Fuel costs about 40% of the total cost
10% payment on truck lease or loan
9% for truck maintenance and repairs
Truck insurance is 4%
2% for licenses and permits
2% of tires
1% charge
Driver salary is 26%
All of these fees have an impact on the shipping price. For example, when crude oil prices rise, we see diesel prices and freight rates rising. When it comes to fuel, this is by far the largest part of any trucking company's budget. Therefore, it is easy to understand how fuel prices directly affect freight rates.
However, when interest rates rise, these loan payments and lease costs start to rise. The point is, as long as the economy affects the operating costs of trucking, it directly affects the cost that transportation customers pay.
Big Data Bottom Line
A shortage of drivers and rising fuel costs are just some of the reasons for the steady rise in freight rates. As you can see, it's a lot more complicated than any single answer. Other factors driving interest rates soaring include natural disasters, seasons and social disruption. Instead of trying to track the best shipping rates for your heavy equipment shipping needs, we recommend you turn to an expert.
Things to Consider When Researching Shipping Rates
When researching shipping rates, your task is to get the best shipping rates possible for your shipping needs. One way is to understand the makeup of shipping costs. Consider the different variables that affect rates and how those variables relate to your shipments.
Fuel cost
A common misconception is that if diesel prices fall, so will transportation costs. In addition to fuel costs, there are many other aspects such as FMCSA regulations and seasonal demands. Also, if you have a contract with a carrier that provides you with on-going freight service, you likely have locked in an inline shipping price that includes a fuel surcharge portion that reflects the price of the fuel pump.
The type of shipping serviceyou need will also affect the overall shipping rate. You can expect to pay more for specialized freight including oversized cargo, tanker transport or refrigerated cargo. These types of transports require more time and effort, as well as expensive specialized equipment. You can save the most on shipping if you're dealing with flatbed freightor a basic dry van trailer, especially if the freight is touchless hitch.
LTL and vehicle
Another myth is that you have to fill a truck with 26 single stacks of pallets to get the goods out. Thanks to the boom in e-commerce, less-than-truckload shipping companies have increased bandwidth. LTL shipping is more accessible due to the supply and demand relationship between shipping customers in the commercial and residential sectors. This means you no longer have to wait until you have enough to fill a truckload to save on shipping.
Consider the cost savings and faster turnaround times you can realize if you choose to ship with LTL freight services. Whether you're shipping to warehouses, retailers, or directly to customers, your products get to customers faster. This enables your business to make more money faster and keep your products on the move.
Time of year
Certain seasons lead to peak shipping. Holidays and summer months are two of the busiest times of the year for operators. However, as produce picks up, spring freight demand will also increase. This also drives the demand for cargo trucks in the event of natural disasters such as hurricanes or tornadoes. Here's a good rule of thumb if you want to avoid skyrocketing freight rates in the spot market. Avoid shipping at the end of the month, before holidays, or at the end of the fiscal year.
Service Hours Rules
This brings us to the most important aspect of any shipping rate. The driver delivering your cargo is regulated by the Federal Motor Carrier Safety Administration as a commercial vehicle operator. FMCSA mandates regulations for truck drivers to ensure their safety and the safety of others. One of the latest regulations to come into force is the Electronic Recording Equipment Directive.
Save on shipping
All of these factors can change the price of shipping from one minute to the next. It is important to understand these variables so that you can prepare for a sudden surge in price.
