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In the course of our work in the last couple of years, we’ve seen many buyers needing to procure various products from international suppliers. In this manner, they could receive better rates than if they collaborated with a trading business. At the same time, they face another issue: the high cost of shipping.
We all know that shipping costs are high from every supplier in China separately, because each shipment includes a standard shipping cost. If you send each purchase separately and do not combine them, you must pay for this base shipping cost per shipment, which is costly. It is especially true since several manufacturing companies are in the mix.
How do we solve this issue? That’s the focus of this article.
When you source products from different suppliers in China, the most cost-effective way is to combine goods from different suppliers into one batch and deliver to your location.
This way you only need to pay the base shipping and customs fees once,
Additionally, international shipping costs tend to be structured such that the heavier or larger the cargo, the lower the shipping cost per kilogram or cubic meter.
And the more products you have, the cheaper shipping methods you can choose – air or sea.
This is a key consideration for your business, especially if your profit margins are low.
The minimum weight requirement for air freight is 21KG.
The minimum weight requirement for sea freight is 100KG.
For example, if you import 5 different products from 5 suppliers, each 20KGS, you can consolidating them and shipping them together by air or sea freight.
Otherwise, because the weight of each shipment cannot meet the requirements of air and sea freight, you have to pay for 5 international express charges separately.
Shipping by sea will be about three times cheaper than express, which is so tempting.
Generally, you can simplify this process in 3 ways.
One solution is to find a freight forwarder with its own warehouse, which can then be used to consolidate the goods.
Usually the freight forwarder will consolidate the goods for free.
A freight forwarder can usually provide you with the following services.
The disadvantage of this solution is that freight forwarders are not very good at sourcing products and dealing with suppliers.
So when working with them, you must communicate the shipping address, packaging method, box weight and volume, etc. with all suppliers yourself, so that you can know all the costs of the entire project before placing an order.
If you are good at these, then this solution is definitely for you.
The second solution is to ask one of your suppliers to consolidate the shipment for you.
If you have a good business relationship with a supplier and buy from them frequently, my suggestion is that you can ask your supplier about this.
They probably have warehouse space and will let you use it.
If you have multiple suppliers, you will talk to the person closest to your shipping port. Then you can ship other products to their factory.
Some suppliers may not even charge you to use warehouse space if it’s only for a few days.
Your only additional cost is shipping from other supplier to this consolidated factory/warehouse.
If you do not have long-term cooperation and trusted suppliers in China, this solution is not feasible for you.
How to reduce shipping costs when buying from China
If you purchase goods from multiple suppliers in China, the most efficient way to save money is to mix goods from various suppliers into one batch and then ship them to your destination.
So, you only have to pay for the cost of shipping and customs charges at one time.
In addition, international shipping prices are usually structured so that the larger or heavier the shipment, the less the cost of shipping per cubic meter or kilogram. The more items you have, the lower the shipping options, either by sea or air.
This is an essential aspect for your company, mainly if your profit margins aren’t high.
For instance, if you buy 5 different goods from five suppliers, each weighing 20kgs, You can combine them and ship them all together via shipping them by sea or air.
In other words, since the mass of every package does not meet the weight requirements for the ocean and air freight, it is necessary to pay five international express fees separately.
Shipping via sea is around three times more affordable than express, and that’s extremely appealing.
It is possible to simplify this process by using three ways.
Partner with an agent for freight forwarding:
One option is to locate the freight forwarder whose warehouse can be used later to combine the items.
Typically, the freight forwarder will combine the goods at no cost.
A freight forwarder will typically offer these services.
The drawback of this method can be that the freight forwarders aren’t proficient in sourcing goods or dealing with their suppliers.
If you are dealing with suppliers, you should provide the shipping address and packaging method, as well as the volume and weight of the box and so on. to all suppliers you work with to be aware of the total cost of the entire project before making an order.
If you’re skilled at these things, this option is the right one for you.
Request any of the suppliers you have to coordinate shipping costs for you:
Utilize a sourcing firm to help consolidate your shipment:
The most secure and worry-free solution is to choose a sourcing Asian sourcing company.
These companies can assist you in keeping your packages for no cost until you have received the entire package, which allows them to put them back in boxes and send them out using lower international shipping charges.
Alongside the free warehouse and repacking service, you will also get these benefits.
Sourcing companies are specialists in the purchase of products, and their main competitive advantage lies in the negotiation of more favourable purchase costs.
To obtain the most competitive price on shipping, the Asian sourcing company that you purchase from will pick the most advantageous shipping method based on the size of your items.
In addition, purchasing companies have long-term agreements with freight companies. They are often able to obtain lower shipping costs.
Since purchasing firms have been in the purchasing business for a lengthy period, they can obtain lower minimum order quantities from suppliers.
The Asian sourcing company will assist you in determining all possible charges before placing an order. These include the price of the item and shipping charges within China and international shipping costs, and any other costs that might occur.
When you receive the items, submit the items to your agent for sourcing to inspect the quality.
For most everyday products, A general overview of the products will help you solve any problem.
When the quality issue is identified Once an issue is identified, your supplier can promptly return and replace the items for you.
If the issue is discovered within a few days of receiving the items the goods, it is difficult to claim compensation. The cost of returning the items to China is extremely high.
While purchasing companies aren’t specialists in the field of shipping, they can provide a range of services ranging from sourcing items to delivery to your doorstep that includes customs clearance and taxes.
If you want to cooperate with an Asian sourcing company, you must pay a service charge to them, typically 5 to10 per cent of the total amount.
Suppose you’re not skilled at sourcing products, supplier negotiations, product freight accounting, etc. Working with a sourcing firm is the best choice.
However, some sourcing companies will not accept orders below $5,000 because it’s not financially profitable for them.
A good China or Asian sourcing company will help you in the consolidation of manufactured products in an organized manner. They will have strong networks with local warehousing and logistics companies. They will take up the entire responsibility of consolidating the products in the containers and then shipping them to your shores.