With a weaker dollar, shippers’ requests to export are growing.
When US exporters ship, the international forwarders come across interesting shipments that can be rather large and heavy, which sometimes undermine air freighting over ocean freighting shipping methods.
We recently had a shipper who was interested in having us price both air or ocean freight for a shipment of over 78,000.00 kilos of armor and flotation vests to be shipped from Los Angeles to Tin Can Island Port, Nigeria.
Proper packaging is a universal tenet for all shippers to remember. It was especially important for our shipment as it contained two distinct vests with 2 very different weights and volume ratios affecting the bottom line.
The flotation vests should be packed as densely as possible when air freighting. In this case, ETC International Freight System, as their forwarder, found that the volume weight for the flotation vests exceeded the gross weight. Evidently, the armor vests show a denser gross weight than volume since its weight density surpasses its dimensional (volume) weight.
Air Freight – It’s all about the weight
Shippers must know that airlines use a ratio of 166 when calculating your shipment dimensional weight (IE# L x W x H inches; cubic inches divided by 166 = volume weight (VW) in pounds). So, the forwarder (ETC Intl. Freight System) differentiated to the customer how the airlines derived to the total weight of his shipment by using 2 separate values (gross versus volume weights).
The total weight became a combination of the gross weight for the armor vests and the volume weight for the flotation vests. It is always best to stress with the shippers any potential volume weight exceeding the gross weight to prevent any mis-conception associated with freight costs.
Ocean Freight – It’s all about the pallets
When shipping freight in ocean containers, it is also important to consider the packing.
Here we have pallets that are too long and should be at standard sizes as well as addressing double stacking to decrease the number of ocean containers on the waters and decrease the cost. However, packing this way can lead to damage and costly delays. The pallets must be heat treated or plastic pallets and it is best to use a pallet with the dimensions of 48 x 42 inches. Broken pallets must be replaced; failure to do so can cause delays in the shipment plus potential added pallet cost + labor to re-stack and re-load.
It is important to fully disclose all information about your shipment with the forwarder quoting your shipment. The armor vests being shipped to Nigeria, regardless of whether they’re shipped via air or ocean freight, can have additional issues if not properly documented. If the armor vests are for government use in Nigeria, US state department and export licenses would be required to be filed by the shipper here in the USA prior to shipping. If it is not sold to the government and purchased for civilian use, armor vests can be shipped under a general export license only.
These steps below were preliminaries since our shipper wanted a quick estimate to send to his Nigerian buyer. Quick or not, as the forwarder of record, aside from pricing, within a few hours of the request, we provided high-lighted points to the shipper clarifying some of the issues, we discovered from the information given to us.
• Pick up from the shipper with 53’ truck – Estimated 7 trucks (2 hours free waiting: $105 per hour thereafter.)
• Air Freight to Lagos, Nigeria based on 78,054 KILOS, over a quarter of a million
• Documentation and export declaration with a nominal fee based on a general license
• Optional insurance is offered based on the cargo value.
Grand total is provided and the flight frequencies of two flights per week with a travel time estimated at 3-4 days.
Quotes are up to destination terminal/port unless otherwise specified. Any destination charges are not included (IE# terminal/overseas clearance/delivery/inspection storage) unless specifically indicated.
By reducing his volume with a better packing system the savings can be big. This is true for both air and ocean freight.
Since we are on the subject of saving, here is an illustration when using different pallets inside ocean containers:
As the shipment was presented to us 9×40′ containers were needed to meet the packing requirements.
7×40’ with 19pallets
1×40’ with 17pallets.
1×40’ with 17pallets.
As we deciphered the pitfalls of the alleged packing, we presented the shipper with a second option, which would require standard pallets and double stacking pallets.
The shipment would see a reduction of:
Again, the estimate and steps below were preliminaries and since our shipper wanted a quick estimate to send to his Nigerian buyer. Within a few hours of the request, we provided high-lighted points to the shipper clarifying some of the issues, we discovered from the information given to us.
• Container positioning 2 hours free waiting: $85 per hour after x 9 containers or 7 containers depending on the final packing option.
• Chassis fee per day for 9 or 7 chassis
• Pre-pull $100 (optional for appointment only)- it happens the night before at the terminal and prevents delays in the delivery of the containers. Drivers can wait for several hours in line to get one container. It can be a big issue with meeting booking deadlines.
• Ocean Freight to Lagos/Tin Can Island, Nigeria for 9 or 7 containers depending on the packing option
• Documentation and export fees based on a general license
• Pier pass per 20’ and 40’ containers for 9 or 7 containers
• Clean truck fee per 20’ and 40’ containers for 9 or 7 containers
• Optional insurance for ALL RISK coverage
Grand total is provided 9 or 7 containers, 1 weekly sailing, with a travel time estimated at 54 days.
Quotes are up to destination terminal/port unless otherwise specified. Any destination charges are not included (IE# terminal/overseas clearance/delivery) unless specifically indicated.)
CONCLUSION: The Devil is in the Details
Your freight forwarder must have the experience and the interest to scrutinize your shipping data, quickly, and reliably. If you’re looking for security, knowledge, and open communication, don’t expect a quote within 2 hours.
Many forwarders treat their sales request like fast food, in and out with heartburn on the way out. Ideally, you need a licensed forwarder that handles each sale organically, using quality criteria with a disposition provide quality work.
As a pointer, in a recent webinar, I addressed the importance of the packing. Providing standard export packing always seem to surpass custom packing that does not take into consideration the airlines pallets or containers with size restrictions or worse, you ship loose (outside airlines containers/pallets) with a higher rate per kilo, affecting your shipping prices.
This is true to shipping using straight container loads (FCL). Some shippers have to provide quick bids and may not collect all data, information from the manufacturers, or their client overseas. It is a process that can take a little more time, but, so much is at stake and forwarders can’t always clarify options or pitfalls.
For this specific shipper, we provided within a few hours our preliminary pricing and point out succinctly the areas that will require attention before we can summit a final bid. I believe, this should apply as well for a shipper and their buyer rushing a bid.
There are many different types of shipments and each scenario is different. One theme remains the same throughout your shipping, define your Incoterms (freight terms), get your harmonized system number, exact packing, weight and dimensions. Changes can be expensive, having the information confirmed before seeking assistance with your international shipping company can save time, hassle, and most importantly money.