Even after going through supplier qualification, product development, and manufacturing process, you still have to worry about logistics. You might have the best supplier on earth, but if your products can’t get through the borders, it will all be a waste of time and money. You also have to make sure that your product arrives on time and in one piece. Here’s how to ship consumer products from overseas suppliers the right way.
Getting Samples First
The first thing you have to do is have them ship samples for inspection. This will allow you to check the consistency of the product and how they handled the shipment process. This is especially important if you’re going to import products like electric bikes, which can have many defects. Have multiple shipments so you can have a large enough sample size to make a thorough inspection.
The Freight Process
Here, you have multiple options. You can manage your own freight, work with a domestic freight forwarder, or use a freight forwarder from the country from which you’re shipping.
Managing your freight means you have more control, but many things can go wrong, and it can be costly. Working with a domestic forwarder will give you more peace of mind and transparency. They’re also experts at what they do and will make communication much easier. It’s not the cheapest option, however.
Going with a forwarder from the country you’re shipping from will allow you to save money. And since they’ll have a closer relationship with the supplier, they’ll be better equipped to deal with issues fast. The only problem is that they might not be as reliable as a domestic forwarder and getting recourse might be a bit more difficult.
Incoterms are very important and will help determine who will handle certain costs. It will also help establish who should be held liable if something happens with the shipment. You will need to get familiar with terms like FOB, CIF, and CFR.
FOB is short for freight on board. With this shipment method, the seller is only responsible for getting the goods loaded onto the vessel. From this point, the buyer assumes all responsibility. This means that they’ll have to deal with insurance, but also customs. This is the cheapest way to ship but has the highest level of risk.
CIF stands for cost insurance freight. Here, the seller will be responsible for getting the goods to the port of destination. The supplier will also be the one getting insurance. However, you will be the one who will have to file a claim if something happens with the goods. You’ll also be responsible for getting items through customs.
With CFR, or cost and freight, the seller will be responsible for getting the product to the port of destination. They will also handle all costs associated with it. The only fee the buyer will have to pay are port handling costs and transporting items to their facility.
These are the basics of shipping products from overseas suppliers. Make sure that you understand the rules for importing, but also work with suppliers who know your market.