CHINA IMPORT SERVICE FEE

The wondrous rip-off at CIF business

As a rule, you buy goods CIF (cost, insurance and freight) or FOB (free on board). At CIF your supplier bears the costs at the port of departure, the sea freight costs and the insurance. At FOB, only the costs in the port of departure are borne by your supplier, freight and insurance are at your expense. In particular, the design of the CIF conditions by Asian suppliers has recently led to a significant distortion of the cost and performance picture in the freight forwarding business, and in some cases causes enormous annoyance to the customer. Thus, the customer are often charged extra costs with the arrival of the goods, which should actually be compensated with the wording CIF. This is done in the form of ominous charges that did not exist until some time ago.

This move is designed to make the influences of the CIF prices visually attractive or even make profits. In fact, however, a huge eyewash is operated here. Surprise with completely new fancy names: China import service, delivery fee, assignment, delivery fees, clearance fee, etc. New linguistic creations for a changed chain of added value, which now simply generates administration costs from the imputed missing freight costs.

But since all things in the world can ultimately only be followed by commercial considerations, this wondrous mutation is not a miracle, but a deliberate mock calculation that actually conceals covert profits.

The realistic calculation of cargo space shows that here often calculations are clearly under purchasing. In consultation with allied transfer forwarders, these costs will be recharged on arrival in Germany. Formally, it is no longer called freight costs, but has changed the name. The thus surprised receiver then has the problem, if he does not pay, the goods are not delivered to him. Simple but efficient game. In some cases, it should go so far that suppliers can even pay for the assignment of such transport orders from their freight forwarders, so at CIF prices that do not invest the proportionate shipping costs paid by you in the transport, but book as additional profit.

This works as follows: Supplier hands over the CIF goods to the carrier, but pays nothing, but receives a bonus X. The transfer forwarder than debits the true shipping costs plus the paid bonus to the recipient, e.g. in the form of a china import service fee. In practice, we repeatedly see transfer fees that more than double the cost of actual freight. This especially for smaller deliveries. With this unfair game the buyer has to ask himself, why have i bought CIF? The result would be at the end that the shipping costs would have been paid 3x if we include the bonus paid to his supplier!

The CIF purchasing is also problematic for other reasons: They have no influence on the speed and quality of the freight route. In order to minimize costs, "B" carriers are often consulted, offering long-term and often questionable reliability. Especially with tightly scheduled orders you have no control over the shipping time and can experience nasty surprises. Since there is no personal monitoring, you will learn so often, e.g. Not at all if your container has just been parked in a port on the freight route (roll over), which can often happen in the peak season.

The insurances are covered with Asian policies. In the event of a claim, you must enforce your claims against insurance companies abroad. What many importers do not know: the transfer of risk at CIF shops takes place in the port of departure.

Here at Cargo SEAL we clearly drive the policy of clean and clearly stated costs, which you, as an importer, can logically understand. Thus, there are no surprises at the reception. Freight rates are clearly defined by the level of container rates in force on the market and there are no additional, unknown fees with miracle names. You will receive a service that offers maximum in terms of speed and reliability. Especially mentioned in this context is the Cargo SEAL LCL service from Shanghai with a door-to-door service of only 40 days!

So reduce your risk by taking out transport insurance under local conditions. We are happy to inform you about all aspects of loading, as well as the formulation of purchasing conditions (Incoterms) personally. Useful background knowledge about the Incoterms can be found here ...

The Cargo SEAL Group loads for you weekly in its own collection containers ex Hong Kong and Shanghai. Gladly we calculate your inquiry to clear, fair conditions.