Held & Associates, Inc. How To Prepare and Ship Your Container The First in a Series of How to Export I f you are new to export, or have limited experience with shipping, there are certain things that you, the seller-shipper needs to know. To begin the process you should agree to work with an experienced, competent freight forwarder (FF), who is willing to partner with you through the 3. Are there special export licenses, regu- 8. A Value Added Tax (VAT) is the cuswhole process from the quo- lations required? For the EU, there are tomer-importer’s responsibility requiring tation stage through getting minimal regulations. him to think it through, whether it could increase or decrease prior to arrival. paid. Your FF, international 4. For the EU and elsewhere, it is imporbanker, and your shipping deto have the CE Mark. This may take 9. Getting paid is a key issue. The L/C partment, are all key to your tant several months, but is required. Many is the standard, yet requires much docuexport success. new-to-export think they can get a CE mentation, much of which may not be 1. The first step in export shipping is planning for containerization. How will your products fit into a standard 20 or 40 foot container, versus break-bulk or even less than container (LCL), is truly important when planning. It may require astute engineering in the manufacturing process to fit the product into a container. That and planning to sell more units so as to fill a container rather than a LTC load. For example, one Heartland exporter manufactures a piece of machinery that is just an inch or two too wide, and can only fit 10 into a 40-ft container. If just a little less wide they could squeeze 20 units in a 40-footer and cut their freight bill by half. 2. Know precisely who your customer/ consignee is, which must be shown as Consignee on your bill of lading. Ask your customer for their preferred Customs Broker contact information. Their broker should be named as “Notify Party” on the ocean lading to expedite Customs entry and delivery. needed. The DDP (cash for documents terms) is gaining in popularity because it doesn’t require so much paperwork, but more trust between the parties is important because the documentation on what 5. Another question to consider in plan- the customer expects is not spelled out as ning - is it an allowable product for that well as the L/C. particular country? The EU customer is responsible to know and obtain the im- 10. For ocean freight, Held often recommends Cost, Insurance and Freight port license if required. (CIF) because it transfers risk to the 6. Is it marked and packed properly? buyer once the goods are loaded onto the Again, the FF should help the shipper vessel, and the seller-shipper controls the plan for these issues. freight and delivery. At any rate, the shipper should insure the cargo. If no Inland 7. What are the official Incoterms? Spec- Marine cargo policy, instruct your FF to ify your terms on your Pro Forma invoice insure against all risks, no deductible, and on your commercial invoice so there warehouse to warehouse including Genis absolutely no misunderstanding. Sell- eral Average coverage. ing CIF port discharge is typically best for exporters. Always specify to be paid in 11. CIF also reduces the risk of higher U.S. dollars. If delivered to the customer’s costs than anticipated for delivery charges door, then determine who is responsible from the entry port to the buyer. E.g., in Europe, say Austria, these delivery costs for duties and taxes. could be four times higher than we are accustomed to. mark in a day or so, because they had not considered it. Their freight forwarder (FF) should have specified that the EU would need it. How To Prepare and Ship Your Container 12. The biggest risk in shipping is the possibility of delay enroute, which is why most FFs will only give time estimates – both to the port and ocean time, port delays in loading/unloading. Weather, slow sailing (especially to Europe), breakdowns – any of a combination, can cause delays. If it’s a break bulk item, it will take longer at the port, where container unloading is pretty simple. Most ports can really step up loading and unloading containers. But the time it takes for ships to wait in the harbor before they can land is an unknown. 13. Should there be a delay in loading 17. No doc, no load. It is important to get your Commercial Invoice and Packing List to your FF as soon as the shipment leaves your dock. U.S. Customs requires the Electronic Export Information (EEI) filing by the shipper or FF within 48 hours prior to vessel loading. It takes some time to file, and ocean carrier will not load your cargo unless filed. 20. For most Latin America destinations, it is vitally important to verify the importer’s correct name and contact information. If the arrival country’s customs people are not able to contact the buyer’s representative, they will hold up the shipment. In fact, it is suggested that a secondary contact person be listed in case the primary contact cannot be reached. 18. Also required are precise HMS codes (Schedule B), because if there is any problem with Customs at the port of entry, shipper may become responsible for all costs incurred to correct. 21. It is also important to know road weight limits in the country shipped to be sure your shipment does not exceed the weight limits of any specific roadway, or even ocean carrier, enroute to the buyer’s destination. at the seller-shipper’s dock, there may be 19. While much is made of the need for detention or demurrage charges. These a Certificate of Origin to accompany the charges are the responsibility of the seller- documentation, in most cases it is unnecessary for European shipments. The shipper. CofO is primarily required for free trade 14. Shipments to EU and to most major agreement counties, Middle East and countries also require the African countries. As long as the comINTERNATIONAL STANDARDS mercial invoice includes the declaration FOR PHYTOSANITARY MEASURES by the shipper as “Made in the USA,” it (ISPM-15) MATERIAL ISPM-15 generally goes through to the European Wood Packing certificate, meaning treat- destination without delay. ed wood is an absolute requirement for pallets and crates. If a shipment arrives at a Euro port without the ISPM-15 marking, it will be refused, and returned to the shipper at his cost. If it’s an agri-business piece of equipment it must be certified as “New and Unused,” especially Australiabound. This is because even if a grain or piece of contaminant makes its way into the country, it could cause human, animal or plant disease. Most reputable FFs will counsel shippers on all of these possible issues in the export planning process to avoid costly surprises. Information provided by Rick Held and John Romp of Held & Associates. www.held-assoc.com. Layout and graphics by Gilland Graphx www.gillandgraphx.com 15. Prior to shipping, declare any hazard- ous cargo, accompanied by the appropriate Materials Safety Data Sheet (MSDS) to insure that the cargo is not rejected or detained by the carrier. Most are cleared, but additional inland and ocean hazardous charges will be applied. 16. Self-propelled vehicles require U.S. Customs clearance, which takes extra time. Your FF can arrange for this Customs clearance. Held & Associates, Inc. 816-842-6701 www.held-assoc.com Held & Associates: 2013 Recipient of President’s Excellence in Exports Award for Export Service Let us handle your LCL shipments from the UK in our UK ocean consolidation; or let us build a consolidation for your company – avoid LCL costs, pay full container price. Andrea Tarry Import Operations Manager, Held & Associates Inc. ISF – Importer Security Filing requirements now being fully enforced by US Customs. Let Held & Associates pick up your Import ocean cargo using terms of sale FOB foreign port or exworks from anywhere in the world, and we will transmit the ISF to DHS before the ship sails; comply with the regulation; and avoid the $5,000 -10,000 fines. The 10+2 ISF requirement is potentially a far greater liability to US importers than the Customs entry process, and we can help you limit that liability by controlling your shipments before they are loaded onboard the vessel bound for the US. Licensed Customs Broker with 21 years experience handling US import cargo from origin to US destination. Expert in US Customs clearance technical matters and other government agency requirements – FDA, EPA, DOT, USDA, FCC etc. 816-842-6701 x 215 Please note our contribution to the HOW TO EXPORT – “How to Prepare and Ship Your Container,” on pg.. 6 of this issue of IBNewsmag. CALL ANDREA OR PAT (816) 842-6701 ext. 215 or 212 TO SET-UP AND CONTROL YOUR IMPORT CARGO NOW! International Freight Forwarder & Customs Broker Held & Associates, Inc., 1120 Erie Street, P.O. Box 34470, North Kansas City, Missouri 64116-0870 www.held-assoc.com