3 Reasons You Should Work With FOB Term When Importing & Shipping from China

3 Reasons You Should Work With FOB Term

What incoterm should I choose when importing and shipping from China? Some importers pay little attention to it, and rely on their overseas suppliers to arrange international shipping. Below are some key factors to consider:

1. Legally and financially, you are still the one responsible to the US Customs
Regardless of the trading terms and/or who setup the shipping arrangements, the importer is the one responsible to the US Customs. So, if the freight forwarder chosen by the supplier misses important Customs filings or processing, you will be the one on the hook. Failing to send ISF will result in a fine of up to 5,000 dollars.

2. Lack of control over shipping services
With your overseas supplier choosing the shipping company, the services provided in the US can oftentimes be lacking. Since part of the initial draw to having your supplier take care of the shipping arrangement is to reduce headache, this can prove to be especially counterproductive. The shipping company may not treat you as their client, because technically their client is the overseas supplier, therefore, causing lack of direct communication. Furthermore, suppliers may change forwarders often, you may not even know who to contact for shipment updates and services.

3. Hidden charges
All too often, we see importer’s shipments held hostage at the port of arrival, with the shipping company demanding additional payments that the importer had not known about. The supplier, as well as the supplier chosen freight forwarder,  in their best effort to secure the order, negotiate the most favorable shipping rates. However, this often leaves out destination charges which are left to the US shipping company to collect before they can release the shipment. The amounts range from nominal handling fee to sometimes even covering portions of the international shipping charges that the origin salesperson intentionally left out, let alone the detention and demurrage fees at destination caused by possible late shipment release. 

Because of cultural and societal differences, as well as the nature of business transactions, your overseas suppliers will most often put cost rather than service, as the top priority when choosing shipping services. This can often lead to poor services which impacts your business.

China-US freight, door-to-door shipping service from China to the United States, get a shipping solution from a leading specialist in China-US shipping. Contact UCS for our tailored services, and start to take control of your supply chain. 

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