Shipment Process: How the Shipping Process Works Step-by-Step

The shipping process seems rather easy when looking at the bigger picture. However, there are many things that could go wrong. When that occurs, it can cost your business. Knowing the entire shipment process is vital for smooth international shipping.

Now, let’s get started and learn the shipping timeline without further ado.

Importer Requests Quotes and Orders Goods

The initial step you need to know when it comes to international shipping is when an importer (consignee) orders goods from the supplier (consignor).

In a traditional import, buyers will ask the suppliers for a quote when searching for items to buy. A proforma invoice can accompany the quote.

A proforma invoice is utilized to offer an estimate and is often subject to change. Remember that it differs from a commercial invoice, the official and final invoice utilized for customs clearance declarations.

After the quote’s approval, the consignee will make a purchase order. A purchase order is a contract outlining the shipping information and the goods’ cost.

Agreeing on shipping conditions

In this shipping process, the contract must be governed by one of the many shipping incoterms after a buyer issues a purchase order to the supplier.

These incoterms allocate the risks and costs between the seller and buyer. They define who is in charge of what while the shipments move from one point to another.

Issuing of Commercial Invoice

The relevant supplier will then give the importer an order confirmation and a commercial invoice. That is a key document outlining the sold goods’ quantity and price. It will also present the shipping incoterms utilized.

Take your time to keep the invoice in a secure place, as it will offer proof of sale and is essential for customs clearance purposes.

Engaging a freight forwarder

As the importer, you can get in touch with your chosen freight forwarder, who will handle the actual delivery of the goods.

Booking Freight Space

It’s imperative that you choose who you want your shipment to be transported to. Air freight is best utilized when the shipping costs less than fifteen to twenty percent of the goods’ value. Transportation is faster, more reliable, and safer than the ocean freight.

However, it’s also more expensive. For instance, a $195 sea freight can cost $1,000 via air. Depending on the cargo you are shipping and the available space in a typical season, international air cargo rates could range from about $2.50 to $5.00 per kilogram.

International shipment through sea freight provides more value and capacity. However, sea freight is much more sluggish than air. On top of that, customs issues and port hold-ups could cause substantial delays.

Inland Transit

Are you partnering with an independent freight forwarder? Then it’s important you have an agent who will contact their overseas partner to organize the collection of goods.

The representative will then get in touch with the supplier and organize the export of the buyer’s goods. That includes the preparation of the required documents used in the international shipping process, which are vital for customs purposes.

Prepare Documents for Shipping

These are the several key documents that you must be extra careful about before exporting your goods or even for international shipping:

·        Air waybill

·        Bill of lading

·        Commercial invoice

·        Certificate of origin

·        Certificate of conformity

·        Export packing list

·        Export license

·        Dock or destination warehouse receipt

·        Inspection certification

·        Insurance certificate

All of the above could be managed on your behalf by licensed customs house brokers or a freight forwarding company.

Export Customs Clearance

Your shipment must be cleared for export before it can be transported by the shipping line to its destination addresses. That process will be done automatically. However, there are instances where particular documentation may be required.

You should ensure the documentation clearly mentions the type of products that form part of the export shipment. That can also help to avoid a delay in the shipment.

Shipping will only start after your package has been provided an export customs clearance.

Loading On an Airplane or Vessel

After the shipment is packaged and ready, it will now be transported to a port of export. Depending on the incoterms, this will either be organized by the consignee or the supplier with their freight forwarder. The export haulage can then start.

Issue A Bill of Lading

Once the carrier arrives to pick up the buyer’s goods, a bill of lading will be issued. This is one of the key documents confirming that the goods were received by the carrier in a decent condition.

Numerous bills of lading may be included in your international shipping process. For example, a supplier may need an ‘inland’ bill of lading when goods are moved from the origin warehouse to the destination warehouse.

There’s a separate bill of lading to be issued by the ocean freight forwarders to a supplier if the next leg of the trip is through the sea.

Here is a full guide and what kind of BL is issued by the Freight forwarder. and what kind of BL is issued by Carrier. and here is for Air freight BL issued by Airline company and By a freight forwarder.

International Transit

After the shipments pass through customs and are ready to go, they will be delivered to the buyer’s destination or the agreed delivery point. Remember that the incoterms on the shipment will identify who manages this.

But based on the shipment type (sea or air freight, LCL shipping, or FLC shipping), an array of transport options will be accessible. That can involve delivering to a roller door for live unloading or delivering a container with a side loader and dropping the goods on the ground.

Arrange Payment to The Freight Forwarder

The cost of the freight forwarder services you opt for will vary on different factors such as:

·        type of cargo

·        the volume and weight

·        packing method

·        the number and size of containers used

·        carrier costs and documentation fees

·        possible administration fees

In the majority of cases, you can compute a quote online on the website of freight forwarders to find the ideal price and service. You will need to factor freight and delivery into the cost of goods sold in the bookkeeping, as well.

Arrive Notification at Destination Country Seaports or Airports

It’s ideal to seek tracking assistance from your selected overseas partner or freight forwarders. It’s always suitable to know the status of your shipment upon leaving the port of loading.

Meanwhile, small businesses rarely deal straight with shipping lines. As an alternative, it’s outsourced from a freight forwarding company that seeks an ideal shipping line.

Tracking your cargo needs you to know the freight forwarders transporting it, the booking number, container number, or document number.

Destination Port Handing

The destination port handling is the process where the shipment is finally loaded. Shipment’s stay at each buyer’s country is part of the transportation process. Having said that, the shipment stays at the destination port based on the time the buyer decides to pay for the goods.

Import Customs Clearance

For this stage, your imported goods must have an import clearance from the customs office in the destination addresses before they can be transported to your location. This process could take a bit of time, depending on the number of imported goods received on a certain date.

On top of that, make sure you’re accessible for a phone call and check your emails. Remember that you’ll also be contacted to finish some necessary documents in most scenarios.

The key documents must be completed immediately and sent back to the customs office.

Destination Country Inland Transportation

Once you have paid the customs duty payments and taxes requested from the customs house broker appointed by the customs office, your package will be cleared.

At this stage, you must arrange proper transport from the customs office to your destination handling or the buyer’s destination. You will need to make sure the transportation company provides to load the packages. That guarantees no delay is encountered in getting the products.

Also, during this shipping process, the goods will be loaded on the truck trailer and ready to move to the buyer’s destination. Here, the freight forwarder issues a trucking bill of lading that is utilized as a confirmation to the buyer that buyer’s goods are loaded and already handled.

Conclusion

Understanding the entire shipping process and having a good shipping timeline is essential to every business or overseas representative. Determining the time for the cargo leaving and cargo arrival allows each person to inform their customs on what to expect about their shipment or their orders.

You see, the entire shipping process could be rather complicated if necessary steps aren’t taken. Overall, we wish to add that both shipping partners and suppliers should pay extra attention to every shipping process detail, especially when it comes to preparing several key documents for the export of imported goods. Doing so will certainly lessen the risks of getting it stuck at the customs’ head office. It will also keep your trade simple and smooth.

We hope you find this guide on how the shipping process works relevant and informative at the same time. Are you ready to start your international shipping journey? Keep all these in mind and you are surely good to go.

If you’re only looking for a reliable logistics provider in China for your supply chain needs, XH can help. We collaborate with numerous businesses to offer them the best options for freight shipping.

Our company covers you whether you need door-to-door shipping, air, or sea freight. Learn more about our freight shipping services and get a free estimate for your next shipment!