June 13th, 2021Sourcing Nova is in China, and we work specifically with Chinese manufacturers. There are close to three million factories in China, although we freely admit not to work with all of them. We have taken great effort to narrow down our factories and manufacturers to the best of the best in the products our customers want and are always ready to find new manufacturers for products you are interested in carrying. Our goal now is to show you how shipping from China to the U.S. functions.
Let’s suppose for a moment, you have done your homework and found an appropriate product to sell on Amazon. You have done all of the necessary steps, ordered and are now waiting for your products to ship from China, arrive in the U.S. and start selling.
Shipping from China to the U.S. is done one of two ways – sea and air. We have covered much about all of the other steps to finding an appropriate product. Sourcing Nova also thinks it important for you to know more about the shipping methods for the most educated decision.
The pandemic certainly slowed things down significantly as people wondered, “Is it safe to order from China?” Now that it is slowly phasing out and the world back to normal, manufacturing and international shipping is starting to pick back up to coronavirus pre-pandemic levels. However, there are still some issues on the U.S. side with ports and warehouses. These are outside of Sourcing Nova’s control.
It is important to get the best quote on your shipping costs and have a proper freight forwarder in China ready to help you with your shipping to the USA. There are a few things you can do to help with the cost of freight, and we will try to cover that on your behalf.
Lastly, insurance. It should go without question – have it. There is no excuse for you not to purchase insurance. More on that at the end of this piece.
Your two options for shipping from China to the U.S.
There are two ways, and only two ways, to get products from China to the U.S. There is a third potential option for Europe, rail. However, you and the U.S. is Sourcing Nova’s focus.
There is water transportation, ocean freight, and air transportation. Sourcing Nova is going to take an extended look into both options.
Ocean freight shipping from China to the U.S.
Ocean freight and water transportation is not a fast option, but it is the most practical option.
Ocean freight means shipping containers, and it is highly likely you will not fill a full 20’ or 40’ container of products load, FCL. Instead, yours will probably be LCL, less than container load.
No matter which method, the products will leave a Chinese port and arrive at a U.S. port that can handle ocean freight containers – of which there are plenty on both coasts, east and west.
The availability of ports mean the water transportation routes can be made efficient and easy. This will reduce your freight costs somewhat. Of course, our freight forwarding partner will know the best ports of arrival for you and your products.
The Incoterms will determine how your products get to you after arriving at the port of call. You will have options: port-to-port, door-to-port, port-to-door or door-to-door. That choice is up to you, but Sourcing Nova can certainly help you out with the decision.
There is an option for premium shipping and expedited freight from China to the U.S. The process uses faster ocean freight shipping and better domestic trucking services that rival air freight in arrival.
Those involved with ocean freight
There are three key individuals who will have a hand in the shipping of your products from China.
· Shipping company – They pack and handle the products from China to the U.S.
· Customs broker – This person or group makes certain all of the documents and products are correct and in order from the government. Some of them oversee the trucking portion of the shipping as well.
· Freight forwarder – We have an extensive blog on this topic for you.
It would appear that the time involved for shipping your products from China to the U.S. would be a complicated process. It is not as difficult as you would think.
The shipping process – simplified
Shipping is not nearly as complex as it may appear. Here are the basic steps:
· The products are transported from the manufacturer to the freight forwarder and Chinese shipping companies.
· The products enter and clear customs of the manufacturer country – China.
◦ Clearance in customs is overseen by brokers who are licensed for this purpose.
· Products are loaded for water transportation.
· Freight forwarders in China choose the products for specific ports in the U.S. depending on the timeline set by the customer.
· The products arrive state side, are unloaded, separated and made ready for the consignee.
· Products are now moved to the customer’s location – a warehouse, Amazon Fulfillment Center or even a home.
Special containers
Your products may have several factors that go into the container decision – size and commodity – are two good examples. If you have highly specific products, there are container options available for you.
· Reefer – A reefer is short for refrigerated. These are temperature controlled for your products. This can be perishable foods, pharmaceuticals or particular chemicals that require temperature control.
· Ro-Ro – The Ro-Ro are used for cars, trucks and SUVs. Ro-Ro is short for roll on/roll off. Vehicles are driven onto the ship, secured in the ship, safe from wind and water.
· Bulk – These containers are put into the hold except for certain solid bulk products – coal, iron and non ferrous metals and liquids – petroleum and its products. Each have their own specific boats for shipping.
· OOG – Out of Gauge. These are non-standard dimension or weight products that will not fit into a standard container – imagine certain industrial machinery and robots. These ship on a platform or even a trailer specifically designed for them.
· Open top – Container without a roof.
· Flat Rack – Contanir that is more of just a platform and is used to ship items of significant height and/or width – think industrial heavy machinery.
Container reference numbers and seals
“Seal’ is a common term for a container lock and is important for container tracking. It is a specific numbered tag that is put onto the container when full and cleared for shipping. The container cannot be unsealed, except for customs inspection or extraordinary conditions, until cleared by customs on arrival in the port of call.
FCL and LCL
These two terms Sourcing Nova touched on briefly above, but more detail is necessary.
LCL Freight
Smaller product orders are often sent LCL, less than a container load. Our freight forwarder will consolidate your products with products from other customers to fill a single container. You will be assessed by the volume of space your products take up in the container – normally in cubic meters.
LCL is ideal if you are taking up around 10’ of a 20’ container. If you are not sure if you need LCL or not, consider the following questions:
· Can your products be shipped with other products?
· Are you okay with longer shipping times?
· Can your products take lots of movement and handling?
· Can you be flexible? LCL arrivals do change and often suddenly.
If any of these questions elicit a ‘no’ from you, FCL may be a better choice even if you cannot fill a container adequately.
LCL advantages and disadvantages
There are always advantages and disadvantages when shipping products from China to the U.S.
· Advantages
◦ Pay for the volume of space
◦ Convenient for smaller orders
◦ Load almost any products
· Disadvantages
◦ Slowest shipping times
◦ Products are loaded onto a pallet with other products
◦ Handling in warehouses has high risk because of packing/unpacking
FCL Freight
If you are ordering products in a quantity large enough to warrant a full container load, FCL, it is more cost effective for you to do so. There will be no need to pack/unpack the container for your products, so this is actually better and faster.
FCL means the weight and dimentions are not an issue so long as your products will fit inside the container without exceeding the container’s dimensions. If filling the container is an issue, you may want to go with LCL.
FCL is preferable for the following:
· You want the products isolated, sealed and secured in their own container for the duration.
· Issues that could arise from others such as leaks, contamination or customs would slow your order.
· Your products require minimal handling for a lesser chance of damage.
· There is room and capability to handle a full container at both ports.
· There is enough of an order to fill 50 percent of the space.
Container sizes
There are three container sizes for shipping containers.
· 20’
· 40’
· 40’ High Cube
FCL advantages and disadvantages
Similar to LCL, there are advantages and disadvantages with FCL shipping from China to the U.S.
· Advantages
◦ All the space is yours.
◦ Easy to track the entire time the shipment is moving.
◦ Less handling and sealed until arrival so no unnecessary movement.
◦ Cheaper for large volume and products.
· Disadvantages
◦ 15 CBM requirement is significant.
◦ Slow shipping is common because of a number of factors.
Other differences
There are few more differences between the two to consider.
· FCL – Containers are loaded at the manufacturer.
· LCL – Containers are loaded at the port with other products.
· FCL – Bill of lading issued by shipping company.
· LCL – Bill of lading issued by freight forwarder.
What factors affect sea shipping times from China to the U.S.?
The total time can and will vary based on considerable factors, but the main one is the port of export and port of import locations. Obviously, it will take longer for products to arrive on the east coast than the west coast.
There are a few things to consider as part of the overall shipping time.
· Product load – Some products must be shipped by sea – aerosols, magnets and the like can be difficult to fly over. Lithium-ion batteries can be flown but at great expense, specialized airplane and paperwork.
· Destination – Is the final stop a warehouse, office or your home? Obviously, receiving a 40’ container at a suburban home is not feasible.
· Timing – Do you need your products immediately? Time can be a factor, particularly in the Chinese holidays.
Other delays are weather, customs, and logistical considerations. None of these can be helped.
What is the total amount of time in actual days?
If you are receiving your products on the west coast, the products should arrive in approximately 15 days. If you are on the east coast, it will take 25 days plus.
Door to door is going to take a month to two months at a minimum.
Air freight shipping from China to the U.S.
If the amount of time considered in sea freight is unacceptable, air freight will cut the weeks into days – at a higher cost.
About five percent of products coming to the U.S. from China are air, but 30 percent is the value. The products of higher value and cost are shipped via air freight.
Clearly if time is of the essence, air freight is the logical choice.
Some who sell on platforms order a small portion of products via air, no more than 10 percent, and the rest via sea. This way, they can start selling almost immediately while the bulk of their order is shipped.
Air is best for you under the following circumstances:
· It has reason for fast delivery.
· There is value and air security is considerably tighter.
· Products have a high profit margin.
· Products are perishable, delicate or highly fragile.
· No more than one or two pallets of products.
· Both manufacturer and customer are in close proximity to airports.
Larger product orders are considerably more complex for shipping by air. There is the space question, followed by the consolidation and reversal of the process on arrival. There is also the question of customs – much more stringent with air freight.
Some goods are restricted for air transport under laws from various entities including international, nation and even regulations of carriers. Air cargo is much more restrictive than sea cargo. For example, the following are not viable for air shipping:
· Glasses – light bulbs
· Flammable – Perfumes, colognes
• Toxic and/or corrosive – Batteries
• Magnetic products – Speakers
• Chemicals
• Public health risks – Untanned animal hides
The Air shipping process – simplified
Much like ocean freight shipping, it is not as difficult as you may believe. Here are the basic steps:
· You retain a freight forwarder.
· Give all the necessary details to the forwarder, including manufacturer.
· Cargo arrives at the designated airport.
· Freight forwarder clears export customs.
· Products are flown to the U.S.
· Product unloaded and taken through customs.
· Products are taken to the customer who pays taxes and customs fees on arrival.
It is a strong recommnedation to have a freight forwarder in China and the U.S. for air freight.
What factors affect air shipping times from China to the U.S.?
There are not the issues with air freight as there are with sea freight. Many issues are circumvented simply by flying.
What is the total amount of time in actual days?
It is reasonable to expect products in as little as eight days. The majority of the time is processing and customs – not actual flight time.
Express air can cut about two or three days time, but this is about it.
What are the cheapest shipping costs from China to the U.S.?
Depending on your product order size, samples for instance, freight is much too expensive. It is far better to consider other options.
Standard mail
Regular mail is often a good idea for small parcels and product orders. China Post has several options:
· Air Mail/SAL – small parcels
· Air Parcel, SAL or Surface Mail – large parcels
· EMS/China International Express and EUB – priority
Research each option before making a decision.
Surface mail, SAL, does take considerable time. China Post and EMS are better with one to two weeks time to arrival.
It is important to make sure the manufacturer has the appropriate paperwork in hand. U.S. Customs will lay aside parcels without proper paperwork, and this will delay your products.
It is okay to use regular mail initially, but when your business begins to grow, you will need to rethink options.
Express shipping from China to the U.S.
There are a few international couriers that serve China. Also known as express shipping, these companies are the quite possibly the cheapest method for exceptionally small products – around $5.00 per kg (2.2 lbs).
The biggest players are FedEx and UPS, followed by DHL and TNT. Much like standard post mail, the process is fairly simple and straightforward. Quotes on most packages are available with some basic information inputted into the company’s website.
As long as your products are priced under $800.00, customs will be fairly quick – much more quickly than if sea or air in fact.
It is best to order your samples and ship via post or express shipping before placing a large order. If you are trying to determine your profit margins, this is a great way to get a rough estimate to set prices and test waters for a customer base.
Money – What is the shipping cost for products from China to the U.S.?
By now, it should be fairly obvious. A large part of your investment in products from China is going to be your shipping. There are several factors to take into consideration when shipping, including season, capacity, fuel and other intangible factors like weather. Getting help from a qualified freight forwarder is a great solution as it will help calculate the shipping costs.
However, there are a few considerations you can make to help lower shipping costs from China to the U.S.
· FCL – This is the most economical way as it is cheaper than LCL and based on a flat rate not volume.
· LCL – This is better if you have a small number of pallets as FCL will be a waste of money and precious space.
Air freight is only good if products are necessary in a very short time. Small quantities, under 100 kg (200 lbs) may cost comparative to sea freight. The only way to know is ask.
Average dollar costs
Since shipping varies widely based on external factors, the following should be taken as a general guideline and not absolute. The only way to get close to an absolute cost is having your shipping costs calculated.
· Air Express from China to the U.S. – $5.00 to $9.00 a kg (2.2 lbs)
· Air freight shipping from China to the U.S. – $4.00 to $8.00 a kg (2.2 lbs)
· Ocean freight shipping from China to the U.S. – $10,000.00 West Coast to $15,000.00 East Coast per FCL (Covid – 19 Costs)
This incredible rise in shipping is because many countries, excepting China, cannot operate within normal parameters. Huge amounts of cargo are stuck in port warehouses with empty containers sitting in port with no way to return to China.
Chinese manufacturers are working hard building fresh containers, but there is still not enough to meet all of the demands. Until the pandemic clears in the U.S. and worldwide, shipping costs will remain high until operations return to normal.
The big thing to remember about shipping is the weight is secondary to the volume. Space is much more valuable than weight when it comes to shipping products from China. Weight/volume ratio is roughly one ton = CBM.
· LCL – always calculated in weight/volume ratio – the chargeable weight
· FCL – always a straightforward flat rate based on container size and carrier
Port and shipping surcharges
These are charges that you may encounter as a part of the overall process. These are dependent on companies and their shipping lines.
· BAF: Bunker Adjustment Factor – Sometimes called FAF, Fuel Adjustment Factor, is used because of common fluctuations with fuel.
· CAF: Currency Adjustment Factor – The shipping company wants to protect itself because of fluctuations in monetary values as the U.S. dollar is the world’s transaction currency.
· THC: Terminal Handling Charge – Ports have to pay their labor. These fees are for that labor for loading/unloading. It is fixed for FCL and variable for LCL.
· ISPS: International Ship and Port Facility Security – Maritime safety is a big deal. The piracy in the Gulf of Aden is proof enough. This helps keep ports safe and protect fleet interests.
· ORC: Origin Receipt Charge – This is a China only charge and pays for China to develop and run their ports.
· PSS: Peak Season Surcharge – There are times, June 1 to October 31 for the Christmas season, for shipping from China to the U.S. It is also called GRI, General Rate Increase.
· Port congestion – If a ship has to wait to unload, there is a charge because the shipper is losing money waiting.
· Demurrage – Ports have warehousing. Shipments that are out of order or have paperwork issues cannot leave ports until clear.
Customs Clearance in China and the U.S.
Clearing customs is a big deal and can be complicated for both countries. It is absolute, however. Shipping companies take no responsibility for your customs procedures. Their job is to transport from one port to the next – nothing else. Your freight forwarder can handle these for you for an upcharge, and it is one that Sourcing Nova strongly recommends. Making sure your information and appropriate documentation are in order remains the responsibility of the customer. You will need to have the following:
· Certificate of origin
· Letter of credit or payment terms
· Bill of lading
Saving the two most important things – Time and money
There are more than a few things that you need to know to save a bit of each.
Chinese holidays
Chinese holidays are announced by the State Council each year for the upcoming year. The official dates and total days are shared via media. Additionally, regions and departments make necessary arrangements for work, safety, security and major emergencies. In the case of an emergency, there are protocols for reporting and handling for the people and their holidays.
Chinese holidays are equally important to the Chinese as holidays are to the Americans. All ports are open 365, but not all carriers are working in major holidays.
The Christmas rush for shipping products begins in June and run until the early parts of December.
Knowing this, it is important to prepare ahead so your products are not lost and/or delayed. There have been delays up to three weeks on some occasions as people are rushing to fill their businesses.
Here are the major Chinese holidays to be aware of and to plan for:
• New Years Day
• Chinese New Year
• Qingming Festival
• Labor Day
• Dragon Boat Festival
• Mid-Autumn Festival y
• China’s National Day
Sourcing Nova has a more comprehensive look at Chinese holidays available.
Freight insurance
To wrap up this particular piece, Sourcing Nova wants to mention freight insurance.
You need it.
That should be enough, but insurance is cheap – less than $100.00 for the entire freight order and covers product value in case of damage. It is not a question of if, but when, you will have product damage.
You have two options:
· Your shipping provider may offer it
· You can get it through your freight forwarder and cover the entire shipping period
(h3) File a claim
At some point, you will need to file a claim for damaged goods. Here is what you need to do:
· On arrival, check your products fully and completely
· Take video or pictures of damaged goods
· List the damaged products
· Provide value of the products
· Proof you have the products delivered
It is best to have this information to your freight forwarder within 48 hours. Your forwarder will help file your claim at that point. You can expect a payment in one to three weeks time.
Again, Sourcing Nova is of the opinion to have freight insurance.
Final thoughts
Sourcing Nova has again tried to provide you a comprehensive overview of the shipping process from China to the U.S. We can help you every step of the way with shipping – From China to your door. Are you ready to take the first step? Leave us a comment below, and we can help you get going.
