Coordinating Transportation

 

This section provides some necessary information regarding transportation which is important for the merchants. Generally, it is logical to make an agreement regarding the type of transportation between seller and buyer before loading. Also, the correct choose of the transportation method and its correct implementation lead to international trade risk management. Indeed it should be mentioned that the best cost is not the lowest one in transportation; some cases of cooperating with poor transportation companies ended in a lot of extra charges for the exporter.

 

*International Transportation Tips:

 

  1. Three copies of the original bill of lading must be issued in the origin country before the container’s receipt. Transportation fees – in a prepaid form or a collect form – should be mentioned in detail in the bill of lading, and the buyer is not allowed to release the containers without the original bill of lading.
  2. Check the safety and functionality of the container concerning its transportation history. Disinfect the container if needed.
  3. Try to choose containers equipped with GPS to track their route and trafficking.
  4. It is suggested to receive the container in the Transportation Company’s yard.
  5. Detect the route and its details before reaching the final agreement.
  6. Check the payment type of transportation fee with the transportation company.
  7. Check the exchange rate with the transportation company.
  8. Check for not submitting the value-added tax in the export transportation fee.
  9. Check the possibility of switching B/L (bill of lading) with the transportation company and check the fee, and make a written agreement if required.
  10. Be informed of transit time
  11. Choose the safest route of transportation
  12. Be informed of ports’ congestion
  13. If you use transshipment along the route then necessarily you should agree on its time with the transportation company.
  14. If you are involved with cross-stuffing along the route then necessarily you should agree on its time with the transportation company.
  15. Be informed of the destination ports’ procedures.
  16. In case of transporting food cargo use a Reefer container or if necessary, put the containers below the waterline which is a cooler environment.
  17. Check the possibility of sending the cargo to other buyers in other continents if the main buyer cancels the deal with the transportation company (a transportation company that provides services to an expanded area of the globe, is a better one); if the answer is positive, are they going to issue a new B/L for the new buyer without permission of the previous one and by the request of the shipper and charging them?
  18. Check your free time with the transportation company.
  19. It is suggested to choose a ship that holds a classification certificate.

 

Some useful expressions:

Demurrage: a charge payable to the owner of a chartered ship on failure to load or discharge the ship within the time agreed.

Detention: During the export phase, detention starts when the empty container is picked up from the container yard, and ends when the full container arrives at the port terminal. If the receiver holds a container for more than the free time, this charge will be applied daily.

Storage: Storage charges are the cost of holding a shipment at a location (warehouse, etc.) and will be on the final invoice if applicable. Storage charges may apply for a few reasons, including: Your shipment is selected for a customs exam, and has to be put into storage while waiting for Customs release.

for example, we have booked a container and only 10 days are awaiting us to receive the empty container and deliver it in full stuff form to the port. Everyday which is after the due date of delivering the container to the port a detention fee is charged. Now if the full stuff container is at the port but without delivering, a demurrage charge must be paid for every single day of a full stuff container stay.

 

 

For more information please call our office.