Things I Wish I Knew Sooner About Exporting: Hidden Costs
While the bottom line appears to be the total cost, how sure can you be? Whether you’re running a business or not, you know that most industries have their hidden costs, including logistics. It’s a complicated business and you need to ask the right questions to navigate to all the right answers.
Here are some of the areas that may leave you on the hook for some extra dough.
You absolutely need to know the terms of getting your shipment from point A to point B, all the way. Your incoterms are going to be important to understand thoroughly because they define who is responsible for every inch of the delivery. It’s a big topic, but you’ll be able to find plenty of information to help you get started in our recent article The Smart Shipper's Guide to Incoterms.
Does your quote include all of the necessary costs to its destination? If your logistics partner (or partners) are not properly educated on the duties involved with your shipment, you will be responsible for them. Additionally, if there is negligence with the paperwork or any illegal activities, you could multiply the duty charges or pay the full domestic value of your goods, respectively! Examination fees also get added if there is a reason to inspect your goods. Review your paperwork and focus on asking questions about each country your goods will pass through so you’re thoroughly prepared.
If your goods end up sitting at a destination port too long, plan on paying rent. There isn’t much discussion to be had if you overstay your welcome. There are rules for the duration you can stay at each port, any additional time beyond that date (usually about a week) will incur fees that you will have to pay. If you’re shipping to a destination for the first time, ask about demurrage.
Are you shipping loose items? Understand any costs to palletize your goods and make sure they're included – they may become a line item that you weren’t planning for. As a best practice, palletize your own goods, it’ll save you time and unplanned expenses.
General Rate Increases
Timing is everything is logistics, including the time your shipment departs. After cargo is in transit, rates may be updated and passed along to you. Ask questions about any surcharges and surcharge periods up front, and make sure the terms are included in your estimate paperwork.
After thoroughly discussing and understanding incoterms, you will want to spend just as much time talking about insurance. Your cargo insurance may not be included if it’s not present on your quote, so make sure you ask!
Logistics requires a lot of paperwork, and paperwork requires a lot of time. Who is paying for your paperwork to be completed?
These are just a few costs that may or may not be included on your freight quote. Do your own research to make sure that you aren’t left with a higher invoice than you agreed to, especially if you can ask a few questions up front to avoid it. The Contamar Shipping team focuses on thorough quotes that include 40+ years of experience behind them. You can rest assured that our estimates will be accurate and the communication along with way will be clear. Call us to day at (212) 267-5775 or click here to request an estimate!