Interview with Avram Schlaks
Logistics and Supply Chain Expert, China shipping and transpacific specialist
Many of our creators face challenges when it is time to ship products from the factory to another country or even to a different continent. Of course, the most straightforward approach is to hire a company to assist with all shipping related tasks. However, at Hubbe.rs we always encourage entrepreneurs to put effort into understanding the various processes of creation, distribution, and sales.
Shipping is an important step where lots of things can go wrong. We decided to reach out to Avram and find out about the most important basics and potential challenges related to logistics. Avram has over ten years of international global logistics experience with a deep understanding of China, transpacific trade, 3PL, and supply chain management.
1. Is the process always the same, and at always the same cost?
No, it is not. Shipping from China has specific seasonality. It is the most expensive to ship before the October holidays and Chinese New Year. Other times of the year are relatively stable, and pricing is less volatile too.
2. Is there a solution when someone wants to ship less than a container of goods.
Of course. Pricing is always the best when the quantity is high. However, you can ship less than a container of goods. Various shipments can be combined into one container to leverage the total volume from various organizations.
3. Is there a difference between using big, global companies or smaller ones?
Large, global companies like to work with established, global brands. However, the competitive edge that global companies maintained for an extended period is starting to fade. Smaller companies are also able to compete on some of the markets. Freight forwarders pull many containers together to leverage more freight hence lower price. At the end of the day, a large shipping company still prefers to work with significant assignments and multiple containers, and for smaller jobs, they are not the right one to approach (most likely they won't be interested to work with small companies anyway)
4. Can all goods be shipped with the same kind of arrangement and documentation?
Most goods belong to the category that is called FAK - which stands for Freight of All Kinds. However textiles, specific dangerous products such as electric appliances, batteries... etc. require MSDS (Materials Safety Data Sheet) to prove that production process and all parts are safe, and aligned with international standards.
5. Shipping, especially from China is quite a complicated process. What do you suggest to creators when first time dealing with this task?
Indeed logistics and supply chain management can be a challenging business; there are many areas where things can go wrong. But it doesn't have to. Understanding the details and being well-prepared is one way to ensure seamless delivery of goods. It is vital to have a signed, detailed contract with timelines, and very importantly have insurance confirmed as well.
I recommend to get familiar with the actual shipping process and get a good understanding of timing. One of the typical problems we encounter with new clients that they assume once they signed the contract, next day we are ready to ship the goods out of the harbor. That isn't how it works; we need time to get all administration work done. Although the process is relatively short, it still requires about two weeks from the time the vessel is scheduled to depart the port.
6. What problems can arise and how to avoid them?
- Bank details, and contract details once they are signed, don't change. One common issue is account hacking. If you receive an email about a change of payment details after the agreement was signed, do diligently (in person) doublecheck all the details. Avram says: "Whatever is in the contract, stays in the contract"
- There is a possibility of delays. These often cannot be foreseen due to weather, technical problems, vessel delays, the late arrival of products from factories, and other unexpected issues.
- Make sure your shipment has insurance coverage
7. You are specialized in China-USA shipments. How long does it take to ship from China to the USA?
Depends on the location, and the type of product to be shipped. In general, custom and border patrol clearance takes about four days before the vessel leaves the port. The shipment takes around 14-16 days to Los Angeles, 23-40 days to New York. Once the ship has reached the port, there are up to a day or two (if at all) for customs clearance.
Textiles are a bit different from other goods, because usually charged at a higher rate than normal. There are specific ocean carriers (MATSON) that are serving this niche market with faster transit times but with three times the price of a normal container (e.g. Shanghai to Los Angeles).
All in all, logistics are better left to professionals, especially if we add in a language that creators are not familiar with. This post is to help understand the the shipping process and to be better prepared to get in to discussions and negotiations with logistics companies.
Avram is an expert in logistics, supply chain management and China shipping.