1st time importing from China

[Blake Marvin]

So basically I am really confused with the process and charges involved in importing from China

This is what I think i know so far.

1. I purchase from supplier Via a FOB quote.
2. Supplier uses a forwarder to get goods to there closest port? I then cover these costs? if so when do I pay these fees?
3. The port then ships my my goods via sea to the UK (my closest port)
4. The goods go through checks and when passed, can someone explain the charges and different rates i'll be charged? for example tax or import tax? handling fees? (this is the part which i am most confused)
5. I then have to pay a forwarder to get the goods from the port to my Unit?

I know this sounds so simple to some people but I have spent literally hours looking into this and I just need someone to explain it to me please

 

[Mike Godwin]

Hi Blake.

Firstly I would recommend you contact a good freight forwarder who will arrange shipment to your door at an agreed price. They will also advise you on duty & VAT payment once the good arrive in the UK. Duty & VAT are calculated against the commercial invoice value of the goods. VAT at the standard rate and duty at a rate dependent on what the goods are - all goods have a commodity code and the % duty you pay will be determined by this.

If you buy goods from a supplier on a FOB basis this means that the price of the goods includes the supplier bringing the goods to the point of loading (onto a ship, plane, truck or train). You are then responsible for all the shipping charges to get the goods to your door. When the goods arrive in the UK you will have to customs clear and pay duty & VAT before the goods are released and transported to your door. As I explained earlier a FF can take care of all of this for you at an agreed price.

To conclude, you will get an invoice from your FF for all the shipping charges from the FOB loading point to your door usually after the shipment has been delivered but you will be asked to pay duty & VAT immediately upon your goods arriving in the UK. So you'll get an invoice for duty & VAT when the goods arrive followed by an invoice for the shipping charges from the FOB point to your door.

If you need any more help please get in touch.
Mike.

 

[Linda Fang]

Hi Blake,
yes,Mike is right.I am a supplier in China,we always give FOB price or ex-factory price.FOB price means the transportation cost and other cost in China is included in FOB price,you only pay the cost after the goods is packed into the vessel,such as ocean freight cost,insurance cost,and others in your country.But the ex-factory price is different,you need pay the cost happened in China after your supplier finish the production,for example,the transportation cost,the custom clearance cost and others in China,if you ask your factory to help you arrange the truck to delivery the goods to the port and arrange the custom clearance,I guess,you need to pay before the goods leave the factory.that depends on your supplier.
The different products means different cost.I hope the answer is useful for you.

For any more information,pls let me know!
Linda Fang

 

[MOIC]

I purchase from supplier Via a FOB quote.

If you are sending by sea, then request an FOB quote. If you are sending by courier, then request an EXW quote as the 'courier' will cover the other expenses.

Supplier uses a forwarder to get goods to there closest port? I then cover these costs? if so when do I pay these fees?

The supplier uses THEIR forwarder and the supplier covers all costs to get your goods loaded on to the vessel. You do not pay for any of these costs as you have been charged for this by your supplier (Within the FOB quote).

The port then ships my my goods via sea to the UK (my closest port)

Your goods are then shipped to (most likely) Felixstowe.

The goods go through checks and when passed, can someone explain the charges and different rates i'll be charged? for example tax or import tax? handling fees? (this is the part which i am most confused)

When the goods arrive at the UK Port (normally Felixstowe), you will require to appoint a UK Freight Forwarder to release your goods, prepare UK Customs Clearance and have the goods delivered to you.

It's important to appoint your own Freight Forwarder and to receiver their quotation in writing and to include ALL COSTS.

Not to, will (probably) incur you in very high costs.

It is better that you contact a UK forwarder to arrange the collection from your supplier and they will control all the shipping process to your door. Your appointed Freight Forwarder will liaise with your supplier. They may have to negotiate the FOB fees with your supplier as your supplier will want to use their agents to send the goods to the port and load on to the vessel.

Your fees are broken down and explained as follows:

1. FOB chargers (which you pay to your supplier) covers the transport of your goods to the port and loaded on to the vessel. this fee also includes the China Customs clearance charges.

2. Sea Freight: This will be charged by the shipping agent/freight forwarder who has been used to ship/clear your goods. These costs are forwarded to you.

3. Tipping Charges: This will be charged by the shipping agent/freight forwarder who has been used to ship/clear your goods. These costs are forwarded to you.

4. UK Customs clearance: This will be charged by the freight forwarder who has been used to clear your goods. These costs are forwarded to you.

5. Import Duty: This will be charged by the freight forwarder who has been used to clear your goods. These costs are forwarded to you.

6. VAT: 20% of the Commercial Invoice plus all shipping costs. This will be charged by the freight forwarder who has been used to clear your goods. These costs are forwarded to you.

7. Delivery to your door: This will be charged by the freight forwarder who has been used to clear your goods. These costs are forwarded to you.

It is advisable to use a UK Freight Forwarder to handle the above and to put ALL quotes and what is included in writing.

Ensure to include Insurance from your suppliers door to your door.

Prior to shipping, there are a multitude of Do's & Dont's to follow . . . . . . . .Perhaps for another thread.

 

[PowerForwarding]

As other above have stated - find a UK freight forwarder to get all the costs to door. Either ex-works or FOB are best. Ensure it covers all charges though.

 

[Maple Sourcing]

The key is to find a reliable and capable supplier, everything else is relatively easy. You will know the whole process after one try.