Understanding the word Freight forwarder
Freight forwarding is a service used by companies that deal in international or multi-national import and export. A freight forwarder doesn’t move the freight itself but instead acts as an intermediary between the client and various transportation services. In the context of China-Philippines trade, freight forwarders play a crucial role in managing the movement of goods, ensuring they arrive at their destination safely and efficiently.
Subscribe to the Ex-works24/7 newsletter
Freight Forwarder challenges for China trade
Selecting the right freight forwarder is crucial for the success of your shipping operations. We’ll discuss factors to consider when choosing a freight forwarder, such as experience, reputation, network, and services offered. Additionally, we’ll provide tips for conducting thorough research and vetting potential freight forwarding partners.
Opportunities and Innovations
Despite these challenges, the freight forwarding industry between China and the Philippines is ripe with opportunities. The increasing trade volume between the two countries has led to a growing demand for efficient and reliable freight services. Companies are leveraging technology to streamline operations, reduce costs, and improve customer service.
China to the Philippines routes and it's future
The future of freight forwarding from China to the Philippines looks promising. With the continuous growth of e-commerce and the increasing trade relations between the two countries, the demand for freight forwarding services is expected to rise. Moreover, the increasing adoption of digital solutions is set to revolutionize the industry, making freight forwarding more efficient and customer-centric.
The shipping cost from China to the Philippines
The shipping cost from China to the Philippines can vary depending on the mode of transport and the size of the shipment. Here are some general estimates:
Sea Freight: For bulk goods, sea freight is usually the more economical option. The cost for Less than Container Load (LCL) shipments typically falls between $250-$400, while Full Container Load (FCL) shipments can cost between $800-$1,2001.
Air Freight: Air freight is priced between $1.50 and $4.50 per kg1, making it an ideal option for urgent or valuable items.
Express Shipping: Express shipping methods like FedEx, UPS, and DHL offer fast delivery to countries with a small fee of course1.
Kindly be aware that these figures are approximate and the actual cost may fluctuate depending on factors like the precise weight and dimensions of the goods, the designated port of origin and destination, and the prevailing market conditions. For the most precise pricing, it’s advisable to obtain a quote from a dependable freight forwarder.
Frequently
Asked Questions
When shipping freight from China to the Philippines, the following documents are generally required:
Bill of Lading (B/L): A legal document that serves as a receipt for the goods and a contract between the shipper and the carrier. For sea freight, this is often a Master Bill of Lading; for air freight, it may be an Air Waybill.
Commercial Invoice: This document lists the goods being shipped, including their value, description, quantity, and terms of sale (e.g., Incoterms).
Packing List: Details about the packaging, weight, dimensions, and quantity of each item in the shipment.
Certificate of Origin: This document certifies the country of origin of the goods. It may be needed to determine duty rates or comply with trade agreements.
Import Permit (if applicable): Certain goods (e.g., pharmaceuticals, food, or electronics) may require an import permit or clearance from the Philippine authorities.
Insurance Certificate (optional but recommended): If you're insuring your shipment, you'll need to provide proof of insurance coverage.
Customs Declaration Form (for Philippine Customs): This form, submitted through your freight forwarder, details the goods and their value for customs clearance.
Since paperwork requirements can vary depending on the nature of the shipment, it’s advisable to work with your freight forwarder or customs broker to ensure all necessary documents are in order.
The Philippines imposes customs duties and taxes on imported goods, and the specifics can vary depending on the nature of the goods being shipped. Generally, you can expect the following:
Customs Duties:
The rate varies depending on the type of product, ranging from 0% to 30%. Some goods may be duty-free under certain trade agreements or if they fall into specific categories (e.g., personal effects, certain raw materials).Value-Added Tax (VAT):
The Philippines imposes a 12% VAT on most imported goods, based on the customs value (cost of goods + shipping + insurance) of the shipment.Other Taxes or Fees:
- Customs Clearance Fees: These can vary depending on the value and nature of the goods.
- Excise Taxes: Some products, such as alcoholic beverages or tobacco, may be subject to additional excise taxes.
It's important to work with your freight forwarder or a customs broker to determine the exact duties and taxes for your shipment
The shipping time varies based on the mode of transport and specific route:
- Sea Freight (FCL): Typically 10 to 20 days, depending on the port of origin and the final destination in the Philippines.
- Sea Freight (LCL): The transit time is similar to FCL, but may be slightly longer due to consolidation and deconsolidation at the ports.
- Air Freight: Usually 3 to 7 days, depending on the flight schedule, customs clearance, and delivery options.
- Courier Services (Air Freight): Express shipments can be delivered in 3 to 5 days for smaller packages.
Delays can occur due to factors such as port congestion, customs processing, or adverse weather conditions, but these are generally the standard time frames.
The most common shipping methods used by freight forwarders for shipments from China to the Philippines are:
Sea Freight (Ocean Freight):
- Full Container Load (FCL): A dedicated container for your goods. This is cost-effective for large shipments.
- Less than Container Load (LCL): Shipping goods in a shared container with other consignments. It's more economical for smaller shipments.
Sea freight is the most economical option, with transit times typically ranging from 7 to 20 days, depending on the port of departure (e.g., Shanghai, Shenzhen) and destination (e.g., Manila, Cebu).
Air Freight:
Air freight is faster but more expensive than sea freight. It is ideal for time-sensitive or high-value goods. Shipping time is usually around 3 to 7 days from major Chinese airports (e.g., Shanghai, Guangzhou) to the Philippines.Rail Freight:
Though less common for direct shipments, rail freight through the China-Europe rail network is sometimes used for bulk goods. However, it still requires further transit by truck or sea to the Philippines.Courier Services (for smaller packages):
For smaller or urgent shipments, international couriers such as DHL, FedEx, UPS, and TNT offer air freight solutions with fast delivery.
A freight forwarder is a company that arranges the transportation of goods on behalf of businesses or individuals. They handle the logistics, coordination, and management of shipping from the origin country (in this case, China) to the destination (the Philippines). Freight forwarders are valuable for several reasons:
- Expertise: They have knowledge of the best shipping routes, tariffs, and customs regulations.
- Cost Efficiency: Freight forwarders can often secure better rates with carriers due to their volume of business.
- Convenience: They handle all logistics, including warehousing, packaging, documentation, and last-mile delivery.
- Customs Handling: They assist with customs clearance at both ends, reducing the risk of delays or fines.
Using a freight forwarder helps streamline the shipping process, especially if you're unfamiliar with international shipping procedures.
