Considering ordering from China and wondering about the shipping costs to your home country? If yes, we recommend reading the blog below. This blog provides tips on purchasing products from China. Our goal is to help you avoid common mistakes and prevent overcharging for shipping.

We consistently assist customers all over the world in shipping goods from China. ETS Logistics serves clients in Europe, the USA, the UK, Australia, and other parts of the world, all making regular purchases from China.

Over the years, we’ve noticed common shipping mistakes that can be avoided. Our goal is to share tips to prevent you from being overcharged for shipping from China to overseas. We’ll help you choose the best delivery option and assist with shipping and customs.

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Most probably, you are currently chatting or e-mailing with a potential seller in China because you like something they’re selling. Perhaps on Alibaba, Made in China or another platform. It’s quite likely that the Chinese seller is offering you shipping  at a very cheap price. Seems reasonable to accept, doesn’t it? Unfortunately, there are 3 risks here:

1^st risk – overpaid shipping fees

The ‘trick’ lies in the offered ‘cheap’ shipping delivery term (also known as incoterm). In 99% of cases, Chinese shippers offer ‘cheap’ shipping with a delivery term (incoterm) starting with the letter “C”. CIF and CFR are the most common delivery terms offered by Chinese sellers, regardless of the destinan country where the buyer is.

Delivery terms starting with the letter “C” include only a small part of the total shipping cost.

• CIF and CFR delivery terms do not include any costs on the receiving (your) end. It means you as a buyer are responsible for these expenses, regardless of your specific location or destination country.
• Costs on your (buyer) side may include handling, moving goods from the port/airport/station to a warehouse, paperwork, security, fuel surcharge, and other fees.
• These costs can add up to hundreds or even thousands of dollars.
• In most cases, those named costs make up the majority of the total cost. All those costs are the buyer’s (yours) responsibility. Buyers must pay those charges to the agent at the destination for the goods to be released.

Unfortunately, we often hear from clients who realize the issue too late – after their items have already shipped from China. They missed the incoterm risk, chose the ‘cheap’ shipping from the Chinese seller, and end up paying extra for local charges in their destination country. Unfortunately, it’s already too late to discuss or negotiate with the Chinese shipper. Legally, everything is correct, as CIF and CFR mean that all costs in the destination are the buyer’s responsibility.

Based on our experience, agents in Europe, the UK, the USA, Australia, etc., who collect these local charges take advantage of this moment and overcharge the receiver of the goods. Once your goods are in their possession, you have no alternative options. Let’s be honest; it is easy money for them. How are you supposed to know what a fair fee is: 300, 500, or 1000 USD? You just have to pay.

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2^nd risk – overpaid charges due to a not-so-good choice in shipping route

Buyers might be overcharged because the Chinese shipper booked the shipping via a route that causes too high fees for the final receiver (you as a buyer).

What does it mean?

To illustrate, let’s use a real story of what happened to one of our German customers before reaching out to us. It’s important to note that this German scenario serves as just one example; similar situations can occur globally, encompassing Europe, the USA, Canada, Australia, the UK, and other parts of the world.

Now, back to the story. This company in Hamburg, Germany, purchased goods from China with an agreed incoterm CIF Hamburg. Goods can be shipped to Hamburg in different ways. For instance, in sea transport, goods can be shipped to Hamburg:

• Directly to the port of Hamburg;
• Via nearby hubs, not in Germany. For example, near Germany, Rotterdam (Netherlands) and Antwerp (Belgium) are frequently used as international hubs. These hubs serve as central points for combining cargo from various places before transporting it by truck (land transport) to its final destination.
• In our example, the ‘final mile’ would be covered by truck, transporting the goods by land from the Rotterdam hub to the Hamburg customs warehouse.
• In both cases, the final destination is Hamburg, but if shipping goes through neighboring country hubs, the buyer’s final costs are always higher.

Why shipping companies do so?

Is it legal and honest by the Chinese shipper?

Yes, it is. CFR and CIF do not dictate that the Chinese shipper must use a specific routing; they only indicate the final destination, in our example, Hamburg. Remember: CFR and CIF do not include any costs at destination country.

• Very often, the Chinese seller itself does not even know what route is used. So, the Chinese seller might not be aware that, in the case of different destinations, there are good and not-so-good route choices.
• Routes are chosen by the Chinese shipper’s local freight forwarder, who manages their overseas exports.
• Chinese freight forwarders usually choose the route that saves them more money.
• When selecting the route, they do not check for the cheapest option regarding local charges at destination, as this is no longer their responsibility.

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3^rd risk – incorrect or missing documentation.

If the shipping is organized with delivery terms like CIF or CFR, there is an added risk of incorrect documentation.

• Missing and/or incomplete documents, such as the Bill of Lading, Air Waybill, commercial invoice, packing list, certificate of origin, CE certificate, etc.,
• Even a small mistake on the documents may lead to issues with customs clearance and getting your goods released from the port, airport, railway, or customs area.
• All those small mistake can be avoided if you check these documents beforehand.

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Case study

To illustrate the risks associated with CIF and CFR, we share the story with the actual numbers of the same Hamburg-based company mentioned earlier. It’s important to note that this German scenario serves as just one example; similar situations can occur globally, encompassing Europe, the USA, Canada, Australia, the UK, and other parts of the world. The dynamics of shipping routes and international hubs apply universally.

• They bought goods from a Chinese company through the Alibaba platform.
• Along with the goods, the Chinese seller offered very “cheap” (270 USD) shipping from China to Germany.
• Without realizing the potential risks, the German buyer accepted the offered ‘cheap’ transport.”
• The buyer also did not pay attention to the delivery term – CIF Hamburg.
• Additionally, the buyer didn’t know that the selected shipping was arranged through the port of Rotterdam in the Netherlands.
• Approximately two months after the goods left China, the German customer was contacted by an agent from the Rotterdam hub.

Shocking additional costs

• The Dutch agent sent a 900 EUR invoice for ‘local costs’ to the German customer.
• The German customer was upset, thinking there was confusion or a misunderstanding. They began arguing with the Chinese sender and the Dutch agent, and the exchange of emails continued for a week.
• Customer started Googling, and they found us, asking for help. They wanted to know if the sender tricked them. Why is this Dutch company asking for extra money? In this situation, we could only confirm that, legally, everything is correct on the sender’s side. CIF Hamburg means all costs at the destination port and terminal are the buyer’s responsibility. This includes cases where the goods go to the customs warehouse in Hamburg through a foreign hub like Rotterdam. All costs at destination port stay the buyer’s responsibility.
• The customer gave us all the papers for the shipment. Our customs expert saw that the information on the commercial invoice and packing list didn’t match the details on the Bill of Lading. It took three workdays to fix the documents, and our expert talked to the Chinese seller during this time.
• The goods are released from the intermediate hub (in this case, Rotterdam) only when the local costs there (900 EUR) are paid, and the documentation is correct. The free storage period at the terminal is limited, usually about 4-5 working days. Since the German customer spent over two weeks arguing with the parties involved, reaching out to us, and fixing the documents, the Dutch agent sent an additional invoice of 295 EUR for storage to the German company.

The total cost was ca 1445 EUR (270 USD + 900 EUR + 295 EUR). In the case of the FOB delivery term, which we highly recommend when importing goods from China, the total shipping cost would have been approximately 800 EUR less.

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How to avoid the described errors?

It’s definitely worth buying goods from Asia because the quality and variety of products there are good. On a regular basis, we transport hundreds of tons of goods from China to our satisfied clients. However, choosing the right delivery term option is crucial. We recommend avoiding CIF and CFR and preferring FOB or EXW delivery terms.

Don´t rush with the payment

• Before paying the invoice to the Chinese seller send us an email or a screenshot of your chat with the Chinese seller. We do not share the contact information of the Chinese sellers you provide with third parties. You can trust us.
• We will look it and give you free advice on whether the delivery term (incoterm) from this certain seller is actually best for you or it is a „tricky“ one as described above.
• If necessary, we can ask the Chinese seller additional questions if any important information is missing to calculate the correct shipping tariff.
• We communicate with various Chinese suppliers every day and understand their way of doing things, common practices, and more. We regularly assist our clients in Chinese communication, using our experience gained over the years in China.

We help you with shipping, customs and documents

• After checking all the details, we will guide you on the best option. You can select sea, air, or rail transport from China. Our freight forwarder provides free advice on the most suitable method for you, taking into account cost and urgency.
• We do not trick with the shipping price or put you in a difficult situation. You will receive the final shipping price to final destination, with no hidden costs.
• As an added value, our customs declarant checks for the existence and correct completion of all documents. This ensures a smooth movement and proper declaration of the goods in customs after they leave the origin port.

We do not charge you for this additional help. We will not sneakily add any consultation fee to your future invoices. Our main goal is to earn your trust, and we hope you’ll choose us for your future orders as well. We keep your shared contact details with Chinese suppliers private. We don’t share them with anyone else. Our primary goal is to earn your trust.

You surely have additional questions. We’ll gladly answer them in writing or over the phone.

*The information provided on this website is not to be construed as legal, financial, or tax advice, nor does it constitute any form of service for formalizing purchase and sale transactions. Prior to entering into a contract for the sale of goods, each company is advised to thoroughly assess the financial, tax-related, and legal implications of the decision, taking into consideration all associated risks.

*The owner of this website disclaims any responsibility for the content and accuracy of the information, opinions, posts, and comments, or any other information presented on the website. Furthermore, the owner is not liable for any consequences that may arise from the use of the information contained on the website.