Guest post by Maciej Brzozowski representative of Port of Hamburg
One of the megatrends in economy of the last few years is outsourcing and concentrating on a key competences by the companies, while leaving less relevant matters to the proven business partners. It concerns not only the producers considering the “make or buy” problem, but also trading and service companies. Even the army uses outside companies for facility security service. In case of import from China, the thing we easily hand over China is organization of shipment to the country, because who would be better at it, if not the company operating in a region that’s called the world’s factory.
China Logistics – let the proffesionals do it
Besides, we would want the delivery (i.e. the point where we take over the responsibilty for the goods) to be close enough for us to take an actual control over it. No one wants to pursue claims for a cargo that’s been damaged somewhere in the world either from the supplier or the insurer who may not even have a branch in Europe. On the other hand, there are some arguments in favor of taking over the organization of shipping. Maybe they’re worth considering?
But firstly, some points against that matter that are often being brought up. First of all – I’m not an expert in shipping, so I’m not going to handle it. Well, it’s hard to neglect its validity. Secondly – my Chinese seller has better prices. It may be so, but if we’re not familiar with the freight market then how are we supposed to know it?? Finally, a freight forwarder is an additional broker and an unnecessary cost (because everything would be taken care of by my Chinese business partner) burdening my limited budget. This point is worth noting, but first things first.
When thinking about taking over the organization of shipping I don’t mean a situation in which we arrange and supervise everything by ourselves. Quite the contrary; I mean a situation in which we hire a professional to do this task, and that is a local forwarding agent. Naturally, you can do everything by yourself, especially if you already have some experience, and if you like challenges. But what if our plans are verified by reality? It’s always better when someone knows the procedures and has contacts (forwarder usually has partners in many countries in the world, especially in China) reacts to unexpected events, then everything is going to be fine and the outcome – predictable. So the freight forwarder it is.
Work with US and EU based forwarding companies
But they’re a broker, and hiring one costs, often a lot of money! However here I’ve got some very good news: on a freight market the client is in charge, and a shipper’s fee is quite low, usually about few dozen USD. In return, the charterer (the party concluding an agreement, usually a cargo owner) gets free advice concerning transport possibilities and sometimes – technology, and certainly obtains a transport optimization (also minimizing of costs) through the whole supply chain. The shipper just simply knows the market and is able to offer the cheapest carrier at the moment, and the cheapest good solution. In which port should our cargo be landing?
To use a car shipping or a road-rail transport? What kind of customs clearance to choose, and where? Do we prefer a local clearance or maybe a fiscal clearance in Hamburg? For someone who deals with container transport on a daily basis these and other similar questions are easy to answer.
Naturally, a crucial advantage of taking care of shipment by yourself and cooperation with a forwarding agent is a good flow of information. As a charterer we become a party of the agreement, which gives us not only the access to a container’s current status, but also the ability to change some of the earlier dispositions (e.g. a change of route and port of landing in order to quicken the arrival of cargo – in a situation of booking made by the Chinese partner, all changes must be reported by them, while the receiver’s instructions, even written down in a bill of lading, won’t be executed because the receiver is not a party of the agreement).
There are also some other advantages from cooperating with a forwarder. As a professional they’re able to forsee transport risks and counteract them. They will take care of all the formalities and ensure that the record-keeping is being held professionally. They will provide a supervision in critical moments (e.g. points of switching the carrier) and use their own financial resources in order to make the clearance easier, faster, etc.
Pick a solid logistic partner for your China import
In conclusion, it’s good to have a business partner organizing the shipping on the spot, because it definitely makes communication and reacting to emergencies much easier. Plus, there are more and more spedition companies on the Polish market that understand characteristics of shipping and actively offer their services in the field. Choosing this kind of solution is worth considering, especially since it eliminates the necessity of active engagement in organization of transport, giving comforting feeling that in case of emergency there is a professional who’s going to take care of everything for us.
About the Author:
Maciej Brzozowski has been a representative of the Port of Hamburg Marketing in Poland since 2002 and is responsible for representing the interests of the Port of Hamburg and the member companies of the Port of Hamburg Marketing Association.Besides that, he has over 10 years of experience in the field of shipping thanks to working as a merchant fleet officer (1990-1994) and then in the agency representing the shipowner CMA-CGM (1986-2002). He graduated from the Gdynia Maritime University and the University of Gdansk.