If you want to transport goods from one country to another, ocean freight will be one of the most cost-effective options for you to consider. It is a much less expensive method compared to air freight or land transport.
But the world of international shipping is full of technical jargon and rules that many companies, especially first-time importers, find daunting. Here we have put together a list of eight things you need to know before shipping your goods by sea.
1. Types of container
There are four types of containers often used for transporting goods by sea: Dry Containers, Reefer Containers, Flat Racks Containers, and Open tops Containers.
DRY containers
These containers are used for general cargo, which should not be over-length, over-width, over-height, or over-weight.
REEFER containers
REEFER containers maintain the temperature of the frozen, chilled, or warm cargo. They are always used for transporting food (such as meat, fish, vegetables, fruits & eggs), films, plants, and pharmaceuticals.
FLAT RACK containers
Flat racks are best suited for storage of heavy lift and over-height/over-width cargo.
OPEN TOP containers
Instead of a solid roof, these containers have a removable waterproof tarpaulin that may be secured with ropes. These containers are the ideal solution for transporting things that are over-height or long.
2. Shipping Container Dimensions & Specifications
The most commonly used shipping container is the dry container, and there are 4 common specifications as follows:
3. What Is CBM And How To Calculate It?
The abbreviation CBM stands for “cubic meter.” It is a unit of measurement for volume and is used by shippers to determine how much someone will pay for freight.
Here’s how it works:
Length x Width x Height = CBM
For example say you have an item that is 40cm long, 35cm wide and 20cm high. Then, its volume is 0.4 x 0.35 x 0.2 = 0.056 cubic meters.
If you have 50 such items in one shipment, multiply this CBM with the number of items to get the total volume — 0.056 x 50 = 2.8 cubic meters (m³).
Now, let’s use this equation on some other items that may not be of the same size. For each item, use the same calculation and add up the total CBM to get the total volume.
4. Hire a Freight Forwarder to work with your shipment:
Freight forwarders are the experts in shipping, and they can help you save time, money, and stress. In addition to handling the shipping process, a freight forwarder can handle the shipping process, provide customs clearances, deal with your carrier, and organize needed documentation. Freight forwarders can be a major help to cut down on the time you’ll spend on logistics.
5. what is bill of loading (BOL)?
BOL is a receipt of freight services. It is a legal document offered by a carrier to a shipper which describes the commodity types, quantity, and destination of the goods being shipped.
A Bill Of Loading can contain the following information:
1. Bill of lading number, voyage number, the weight of the container
2. The shipper (consigner) and receiver (consignee)
3. Loading and unloading locations and dates
4. Complete description of the Commodity(ies), such as name, quantity, CBM and weight, value, etc
6. FCL & LCL
FCL & LCL are the types of container shipments. They are classified according to how many are the final recipients:
FCL (Full Container Load): This type of shipment is when the goods must be received by a single recipient, regardless of whether the maximum weight or volume has been reached or not. It is usually preferred by those who need to send big amounts of goods to be sent to a single recipient;
LCL (Less than Container Load): Compared to FCL, LCL is a partial load container. It refers to the shipment taking place with more than one recipient. If the products to be shipped do not fill a normal container, the load is grouped with other loads for the same destination in a Container Freight Station. The freight charge is calculated in LCL based on the cargo volume. After a particular weight restriction, freight is calculated based on weight rather than the dimension.
7. ETD & ETA
The phrases ETA and ETD in shipping refer to the time it takes for an item to be sent and delivered after it has left the warehouse. Although they both relate to the same shipment, they are computed differently. Expected or Estimated Time of Departure is shortened as ETD, and Expected or Estimated Time of Arrival is abbreviated as ETA.
Both ETAs and ETDs are important to customers because they can be used to track items, schedule deliveries, and decide when to order products.
8. EXW, FOB, CIF & DDP
EXW, FOB, CIF & DDP, these three-letter terms are referred to as Incoterms in international trade. They essentially outline who’s responsible for certain transportation costs and other risks.
EXW — Ex-Works
EXW basically refers to the product’s pricing and nothing else! There are No shipping costs or export fees.
FOB — Free on Board
FOB means the seller is responsible for transportation to the point (the port of export) and the buyer is responsible from the point of export to the destination.
FOB pricing covers product cost, local exporting fees/customs and delivery of your order to the nearest port.
CIF — Cost, Insurance and Freight.
CIF means the seller is responsible for transportation and the price quoted includes the cost of transportation as well as insurance and other costs incurred up until the point of destination.
CIF pricing covers free on board and charges of Freight and marine insurance.
DDP — Delivered Duty Paid
DDP means the seller is responsible for all costs and suffers any potential losses of moving goods sold to a specific location.
This means that the price includes EVERYTHING: product cost, freight charges, insurance and fee of customs clearance/ duty.
Different shipping terms, the price is different. When comparing prices from suppliers, ensure that you are always comparing similar shipment terms.