IMPORTING FROM CHINA TO US

Hi n2n,

Here's the whole topic:

http://www.able2know.com/forums/viewtopic.php?t=26073

Click on that link and then read away! Lots of great info there.

Welcome to Able2know!

Importing from China to US
Craven you are the Mann! I appreciate your knowledge of shipping and handling from china. Your expertise as a logistics & operations manager is great! Thank You Much! I have learned quite a bit from the others that have faced similar questions and minor road blocks in the mapping of their products to the US. I have a few more questions for you, if you don't mind giving a little more insight. First Off is there a map of how the product is moved from China/Asia to the US/Canada and from the US/Canada to the warehouses than to the distribution sites. Something that I can see, a map out would be highly effective for someone like myself who is a beginner in the business of purchasing from a manufacturer in China and selling wholesale/retail in the US / Canada?
The CIF is this all handle by the broker as well or a separate entity? Does the price of the CIF have to do with the exact destination (should we follow up with that all the way thru to the wholesale distribution warehouse or to the store front? If I wanted to distribute throughout the US should I also find out what cost would be from other ports such as the east cost? Or is it less costly to have the shipment come to one port than distribute from there? About the FDA Flags what triggers a "Flag" how do I assure a smoothe deliver without know hassle? If the containers are "Flagged" how do I get out of that and move quickly to the destination warehouse without obsorbing much cost? If I wanted to distribute to Canada as well do you think it best with less hassle and smoothe transition if I were to ship the containers directly to Canada than move them into the US & Canada? I live in Nevada (Las Vegas), what advantages do I have to have them shipped to a warehouse in Vegas than distribute them out to the store front by freight? VS having sit in a warehouse in Los Angeles and having them sent by freight to other distribution sites in the US & Canada?
Thank You for sharing your knowledge and expertise in your field of experience it is much appreciated!!! Thank You Again~~~n2n

Thank You Sozobe for the heads up!!! That info is key.

n2n

Re: Importing from China to US


Not really, as it is too large a set of regions to have a single point of entry that makes sense for all logistics. I had warehouses in Fond du Lac and New Jersey and even with only those distribution points I had to work out the best logistics for various scenarios and would sometimes drop ship to clients.

You'll need to do a lot of homework to find what route is best for you but the very simple answer is that you want your warehouse close to where you ship to and your point of entry close to the warehouse.

Certain regions are cheaper than others for warehousing because of land prices (i.e. Nevada is much cheaper than California) but there are a lot of other factors.

For example, it's more expensive to ship from a manufacturing area than to a manufacturing area because you can get deadheads on the way back more often. Little details like that all add up and logistics is about getting it all right on the fly.

You should probably establish as many logistics relationships as possible and work with them all to find what is most efficient and cost-effective.



It depends. I used to pay ocean freight to the shipping line and land frieght to some of my frieght forwarders.

Brokers (of different varieties) are used at every point of the way by everyone involved.

For example, the manufacturer and steamship line would usually use a broker overseas to book the shipment and the frieght forwarder would use a broker for local trucking stateside.

Ultimately it can be a lot easier to work with a full service freight forwarder/customs broker to do it all. I used a company called M.E. Dey that was very helpful in consolidating my logistics.

While it was ultimately a bit more expensive the reduction of logistics overhead made up for it in cost by reducing complications and my time.



I don't know what you are asking about in regard to warehouse vs. store.

Usually, we shipped to the warehouse and distribution to the point of sale was a wholly different set of logistics.

Import logistics and distribution logistics.

I handled them separately unless I was drop shipping to the customer and what is best for you depends on details that we can't possibly cover here (well, we probably could but you should really do it with people who you have business relationships with, as I can only give help as my time is available and there's a shortage of that).




A rule of thumb with logistics is "find out everything". You can't make good decisions without all the info. Shipping a container from coast to coast can cost almost as much as ocean freight from China so it makes a big difference.



Less distance = less costly.



FDA flags and inspections are only done with FDA controlled products. Otherwise you only have customs to deal with.

They will never tell you what criteria they use to flag, I once asked and they said "that's like asking the IRS what they use to trigger an audit".

They don't want to tell you how to get away with things.

Anywho, it's usually based on some criteria + random selection.

Some of the criteria is seasonal (for example wood packaging was being flagged a lot when I was importing) and some are not (for example new importers will get flagged at a higher rate than established ones and even established importers bringing in new product will get flagged for inspection more often than product that has been coming through a while).

Ultimately, there is no way to guarantee no flags and inspections, it's like airport security checks. They do random checks and you can't ensure you won't be hassled.



By being ready and following all their rules. You will need a warehouse within a certain distance (e.g. 50 miles).

You need to get it off the docks to avoid demurrage, get it to a warehourse where they can inspect it and inform them.

I cut down on costs a lot by using Milwaukee as my port of entry as my warehouse in Fond du Lac was close enough to satisfy them but when I was using Long Beach as my port of entry I had to get temp space at warehouses.




It depends on too many details for me to advise you. If you are distributing large quantities you may need a separate set of logistics from Canada, but if not it may be easier to ship from your stateside warehouse.

You'll need to do a lot of research and analysis to know what is cheaper.



Nevada has a lot of cheap warehousing and is a good distribution point to the west.

If you can drop ship to the end location you can sometimes save a lot of money (I saved 40% by doing so for some of my logistics).



Distance = money. You just need to crunch the numbers after getting quotes.

Call up some frieght forwarders, they are usually eager to quote you and very eager for business.



My pleasure, just make sure to start making contacts in the logistics industry. You will need them to do business and they will be a more reliable source of information than I (as I am only here when time permits).

Importing From China to The US
quote:
it is too large a set of regions to have a single point of entry that makes sense for all logistics.

n2n
What do you mean by "logistics"? The detailed info between a starting point top the finish line? Can you please explain?

Quote:
warehouses in Fond du Lac and New Jersey and even with only those distribution points I had to work out the best logistics for various scenarios
and would sometimes drop ship to clients.....

nsn
I am such a new comer & getting a lot of helpful info from a vet, please excuse me if my questions seem trivial........"Drop ship to clients" does that mean delivering straight to the clients doorstep?

Quote:
You'll need to do a lot of homework to find what route is best for you but the very simple answer is that you want your warehouse close to where you ship to and your point of entry close to the warehouse.

n2n
Being that I live in Vegas and ports are more than 50 miles out, it seems as if I would need a warehouse nearby the port within 50miles than freight to Vegas & distrubute from there? (If I find that this is cost effective for me) Am I trailing down the right path here or am I missing this lesson that your giving me?

Quote:

Certain regions are cheaper than others for warehousing because of land prices (i.e. Nevada is much cheaper than California) but there are a lot of other factors.

n2n:
What other factors can I expect?

Quote:
it's more expensive to ship from a manufacturing area than to a manufacturing area because you can get deadheads on the way back more often. Little details like that all add up and logistics is about getting it all right on the fly.

n2n:

"deadheads on the way back more often"? Any good logistics companies that you can refer me too?

Quote:
I don't know what you are asking about in regard to warehouse vs. store.

n2n:
If I were distrubuting to say a walmart, sam goodies, best buy, tower records, target is my product sold by the time I get it to there warehouse or do I have to get it to there store front doors for them to place onto shelves?

Quote:
For example, the manufacturer and steamship line would usually use a broker overseas to book the shipment and the frieght forwarder would use a broker for local trucking stateside.

n2n:
do you think it best to use a overseas custom broker for cost purpose? Are ther any additional benefits? Than have a freight broker help me work put the logistics of delivery from the warehouse and forward the product out the ditrubution points?
Maybe Im confused here (it seems like Im getting it but Im not quite there yet, excuse me) "the warehouse" would be on that I rent or buy for immediate storage of my product, rt? This is were home base would be & were the freight company would forward my product to a "Warehouse Home Base for, say a Walmart Target Best Buy Sam Goodies Tower Records etc.,? Than from here the company would pic up the merchandise that they have already bought from me and send them to the individual storefronts in a cities accross the country, rt?

Quote:

FDA flags and inspections are only done with FDA controlled products. Otherwise you only have customs to deal with.

nsn:
I have figurines and dolls to get out to wholesalers across the country & into Canada and eventually worldwide, FDA wont worry about me I imagine, however what I hear you saying is that customs can hang me up as well?

Quote:
By being ready and following all their rules. You will need a warehouse within a certain distance (e.g. 50 miles).

n2n:
by having my warehouse within 50miles this will allow me to get my shipment of the docks as to avoid dummerage cost and to stay within Customs reach for inspection prior to delivery out my destination site?

Quote:
My pleasure, just make sure to start making contacts in the logistics industry. You will need them to do business and they will be a more reliable source of information than I (as I am only here when time permits).

n2n:
Damn Craven thanks for the details you are truly appreciated. I hope not to drive you crazy with my questions I just want to start my business of on the right foot and it seems as if able2know and you provide me with the opportunity to talk to those who have been there and done that, Once again you are greatly appreciated!!!! Thank You Again!!!

Re: Importing From China to The US


Logistics is a term that covers what you are asking for help about. See here:

http://www.google.com/search?sourceid=Able2Know.com&q=define%3Alogistics&num=25&ie=iso-8859-1&oe=iso-8859-1



Yes, to ship from manufacturer straight to the customer, skipping the warehousing.



Why do you think you need to distribute from where you live?

The criteria is distance from port of entry, distance from end location, and warehousing cost. Where you live has less to do with the cost than it does your personal preference for procedure, unless I have missed something.



I don't have time to write on everything you could possibly run into, but one thing people often forget about warehousing is that the cost of the storage itself isn't the end of the cost calculation, you also need to find out how much they charge to receive a shipment and to process an outgoing shipment.

You may find that those costs are more important to you, depending on the type and frequency of your shipments.



Deadheads are empty trucks. Say most manufacturers are in city A and they ship a lot to City B. Shipments from City B to City A would be cheap because a lot of deadhead trucks would be going back to City A.



I liked M.E. Dey as a customs broker/freight forwarder http://www.medey.com/

Thing is, logistics isn't really dominated by any one big company and you really need to work with a bunch of smaller ones. It's still very much a networking business.



You would have to ask them. This would depend on the nature of the business relationship you establish with them.

I can only guess, and my guess is that they'd want to receive it at distribution warehouses and handle the delivery logistics to their stores themselves.

But again, this is something to determine in business relationships with them.



No.



I think you misunderstood me. Your broker would be stateside but would have to work with brokers overseas. You wouldn't seek an overseas broker but whomever you deal with would use people all over to get the shipment booked and on its way.




That's certainly a common use for a warehouse, thing is what your logistics end up as is dependent on the factors in your business.



If I were trying to sell to Walmart etc, I would try to drop ship to their warehouses and avoid warhousing myself altogether as well as delivery logistics.

Eliminating warehousing and combining import and delivery logistics has a huge cost advantage. The downside is that you need to be able to plan ahead to maintain your fill rate.

If they can give you orders with enough advance time for you to order and ship to them (remembering that the manufacturer might also need lead time) then you are all set with some pretty simple logistics.



Yes.



Yes, but check on the details (i.e. how many miles, whether it needs to be a bonded warehouse etc). It could vary.



My pleasure, I'm not always around and don't always have time but when I do I enjoy helping.

Re: Importing From China to The US
Hi All,
I am learning alot reading over your discussion. I too am in the process of starting up a company that imports electronics parts from China. I am scrambling for information but I honestly don't know what info I'm looking for. I have gotten a quote from a Chinese manufacturer and the terms of the quote are that we get a 20' container and it is shipped to LA, CA. The price is good for the shipment up to cali, but from then on (I want the shipment in Dallas, TX) its mine to take care of. I talked to a customs forwarder and he told me something like " you need to consign it to dallas, or otherwise it will cost too much" and then he would charge $360 for all the customs formalities.

Questions:
1. How do freight forwarders operate? My shipment arrives in LA, and then do they clear the customs there and then ship it my warehouse in Dallas, or do they have it forwarded to Dallas and the release from there and ship it to me?

2. If the destination of the shipment is Dallas. what does the customs office do? do they ship it themselves to Dallas and then charge me. or is it my responsibility to have it shipped to Dallas and then go release it from there?

3. What is deferred inspection?

4. if you could give me a little flowchart of what all is needed to be done.

Craven, I must say you are a mountain of info in this field. May I suggest a consulting firm

Re: Importing From China to The US


Either. You should try to have it clear customs as close to your warehouse as possible so that in the advent of a customs hold your product is not stranded across the country.



Customs doesn't move anything anywhere.



I haven't run into this in my experience, but it sounds exactly like it looks like it sounds to me. ;-)



At each junction there are multiple choices, and the flow chart would get pretty big. I don't have time to do that but would be happy to answer specific questions.




I'm not in logistics anymore, and I didn't work in it too long, I learned what I had to under the gun.

There are a lot of logistic consultants out there, and you can get a lot of free advice to them as they are usually interested in actually brokering your shipments and will give said advice in pre-sales.

I learned all I know that way.

craven, thanks for all your info. I too are learning about this whole thing with China and all. Just have one question for you of "Drop shipping to customer", isn't there some risk of the manufacture or the customer finding each other out and consequently kicking out the middle man such as my self?
your reply is greatly appreciated.

ed

Hi,

This forum is great! I just wanted to introduce myself and offer my services.

I have many years experience with international trade and in particular with China.

I lived and worked for General Electric in China and started two manufacturing businesses for them. I have started my own business as a Consultant.

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Thanks,

Matt

forwarding compnay in China
Hi all,
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thanks!
Maggie

I had LOTS and LOTS of questions too. Contact the people at Silk Road Trade Consultants. They will take the time to help with all your questions. They also have lots of clients from the US.