China shipping, a worked example.

Discussion in 'International Business' started by Packaged Solutions, Aug 14, 2010.

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  1. Packaged Solutions

    Packaged Solutions UKBF Newcomer Free Member

    123 6
    I apologise in advance for another 'how do you ship from China?' thread. But at least I can try to be a little more specific in my question...

    Ok it's my first attempt at this and want to avoid any pitfalls.

    Lets say for example I'm ordering 10,000 flat packed juice cartons.

    Manufacturer says cost per carton is $0.05 and 10,000 will fill a 40' container, that's the best price they can do. But really I want the price to be more like $0.02 to be competitive- manufacturer says they cant do that regardless of no.s

    So anyway lets pretend im happy with that price. Firstly lets (approx) convert that to £.

    0.05 x 0.66 = £0.033.

    But, it costs money to get currency changed right? so that'll be an extra added cost?

    Also, what about an agent? will they want a 'per item' fee? for calculation purposes I'm going to assume an agent fee of £200 for this one order.

    10,000 units x £0.033 = £330.

    + £200 agent fee = £530

    + Duty (which I believe is 0% on paper, cardboard etc?).

    + Shipping (here's the tricky bit. I have no idea how much it will cost to ship and what is the best/cheapest method. Could someone give me a clue? I'm not asking for quotes just a ball park figure, £100? £5000?)

    For calculation purposes I will guess at £500

    £530 + £500 = £1030

    Now we add on VAT at 17.5% = £180.25

    £1030 + £180.25 = £1210.25.

    So thats my container arrived in the UK. How do I get it to my front door? More fees? more transport? for calculation purposes, I'll add another £200.

    £1210.25 + £200 = £1410.25.

    Now the cartons are here on my doorstep and I'm ready to sell. so,
    £1410.25 / 10,000 = my total cost price per item =14p.

    Ok lets have a look at my ebay competitors....

    oh.... people retailing batches of 100 cartons at 8p each.

    :-/ ???

    Any help/clarification/advice will be greatly appriciated!
    Thanks,
    Chris
     
    Posted: Aug 14, 2010 By: Packaged Solutions Member since: Aug 14, 2010
    #1
  2. Packaged Solutions

    Packaged Solutions UKBF Newcomer Free Member

    123 6
    ...no one?
     
    Posted: Aug 15, 2010 By: Packaged Solutions Member since: Aug 14, 2010
    #2
  3. waryfairy

    waryfairy UKBF Newcomer Free Member

    1 0
    I am also preparing detailed costings to see if importing stock from china is a viable option. I am awaiting quotes for only 6 boxes (300 evening bags at 0.8cbm/65kgs total). I think a 40' full container shipment would be a lot more than £500 though.... I would be interested to hear if you get any news on shipping costs.. I'm also not to sure about the whole 'clearing customs' process and of any additional costs this incurs.
     
    Posted: Aug 15, 2010 By: waryfairy Member since: Aug 15, 2010
    #3
  4. ScottNelson&Co

    ScottNelson&Co UKBF Newcomer Free Member

    193 20
    look for UK manufactures? I'm in a similar predicament, I hope somebody helps.
     
    Posted: Aug 16, 2010 By: ScottNelson&Co Member since: Jul 20, 2010
    #4
  5. Vending Siting Services

    Vending Siting Services UKBF Big Shot Free Member

    4,428 698
    If your competitors are selling the same items for just 8p, you need to do more research.

    Shipping over a container from China will be in the region of £2,000. You will need to arrange with the container company to give you a price which includes delivery to your business address which is normal practice.

    The moment the container arrives you will have to pay VAT to your shippers immediately, that is the VAT on the goods that you are importing.

    Another cost you need to factor in - warehousing costs! A 40ft container will need a lot of storage. ;)

    Normally, for a first time importer, Customers may hold your container for an x-ray - they charge you for this and if there is a queue for the x-ray and your container is held at Port it will cost you an additional £100 per day - nothing you can do about it and your container could be held up for several days, it happens quite often.

    Hope this helps.

    Barbara
     
    Posted: Aug 17, 2010 By: Vending Siting Services Member since: Jan 26, 2007
    #5
  6. Packaged Solutions

    Packaged Solutions UKBF Newcomer Free Member

    123 6
    It turns out my order is actually only 3 cubic meters, and not a 40' container! Whats the best/cheapest way to ship smaller loads?

    Thanks :)

    Chris
     
    Last edited: Aug 17, 2010
    Posted: Aug 17, 2010 By: Packaged Solutions Member since: Aug 14, 2010
    #6
  7. J_A_M_E_S

    J_A_M_E_S UKBF Regular Free Member

    121 25
    ..ask a shipping Agent for something called groupage.

    Basically, you share a container.

    Positives to this are that it means you don't have to wait to fill your own container, or pay for space you're not using.

    Negatives to this are that you will have to pay a pro-rata premium to do this, the availability of containers that use this method will not be as often, and it will have to be at the port earlier at their end to be 'grouped' onto the container and take longer at this end to be 'un-grouped' (maybe a couple of days each end maximum).

    If there's any agents on here - they'll be along to give more detail to the above!
     
    Posted: Aug 17, 2010 By: J_A_M_E_S Member since: Aug 11, 2009
    #7
  8. Bvt

    Bvt UKBF Newcomer Free Member

    11 1
    Hi

    WHY DID'T DO EXW PRICE WITH FACOTRY.

    AND THEN FIND A FORWARD HELP YOU HANDEL SHIPPING AND CLEARANCE

    CUSTOM.

    THAT WILL BE A LITTLE CHEAPER.

    if need can contact me , going to give you hand.

    Daniel

    bvtchina. com for furniture

     
    Posted: Aug 17, 2010 By: Bvt Member since: Aug 5, 2009
    #8
  9. Packaged Solutions

    Packaged Solutions UKBF Newcomer Free Member

    123 6
    Thanks for all your comments & sugguestions. I'm *very* slowly learning the import jargon/pitfalls :)
     
    Posted: Aug 17, 2010 By: Packaged Solutions Member since: Aug 14, 2010
    #9
  10. Wholesale-Dealer

    Wholesale-Dealer UKBF Newcomer Free Member

    60 3
    May be this is a good available solution of the problem
     
    Posted: Aug 18, 2010 By: Wholesale-Dealer Member since: Jul 22, 2010
    #10
  11. Packaged Solutions

    Packaged Solutions UKBF Newcomer Free Member

    123 6
    Well, unfortunatly, after going through all the sums and compairing against the competitors, the profit margin is so small it's not worth doing. What a shame :(
     
    Posted: Aug 19, 2010 By: Packaged Solutions Member since: Aug 14, 2010
    #11
  12. ScottNelson&Co

    ScottNelson&Co UKBF Newcomer Free Member

    193 20
    Usually the way. Keep at it, you'll find your niche eventually!
     
    Posted: Aug 19, 2010 By: ScottNelson&Co Member since: Jul 20, 2010
    #12
  13. Bvt

    Bvt UKBF Newcomer Free Member

    11 1
    Hi

    Maybe must be change the business way.

    Also profit is samll, but will is good than no profit.

    Many samll togther , that will be big. right ?

    Daniel

    www bvtchina com --furniture
     
    Posted: Aug 20, 2010 By: Bvt Member since: Aug 5, 2009
    #13
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