Choosing the right Incoterms for deliveries from China
By consulting China Import Agentur Frisch you will find the optimal logistic route for your goods from China.
Fantasy fees for CIF shipments from China
For years, unfortunately, the problem with CIF deliveries from China:
If you accept a CIF delivery from the Chinese supplier, it sounds good, the Chinese supplier will ship your container to Germany for a small flat rate. You have less trouble, you don’t have to worry about it and you pay the supplier much less than what the German forwarding company offered you.
Unfortunately, that only sounds good, because as soon as the goods are in the German port, the offer or even a fat bill flutters into the house. It’s going to be difficult to refuse anyway, since you want your goods and have usually already paid for them.
But why is a CIF delivery and the cost savings a fallacy?
The shipping company commissioned by your supplier in China has a contract with the receiving agent in Germany. This means that your supplier gets the shipping free of charge or often even receives a commission for the shipping order. The costs then come back in Germany – at your expense.
The receiving agent in Germany will inform you before the goods arrive and will make you an offer for delivery within Germany and for customs clearance of the goods. However, the offer already contains fixed items about costs that should already have been incurred, but these may also already be invoiced, since they are due in advance anyway, otherwise your goods will not be released. These costs are hidden in fancy fees called CISF (China Import Service Fee) .
But how much are these fees? Since the supplier in China received the transport free of charge, the fees are usually at least as high as the shipping costs that a German forwarding company may have offered you beforehand or that a German forwarding company would have cost you. So you now pay (because of the hidden fees) the shipping to Germany. As a rule, however, the costs are even higher, since the supplier in China usually received a commission for the shipping order. That means you pay more. It will be difficult to defend yourself against the costs, as otherwise you will not receive the goods and, in addition, there will be daily storage costs that are not inconsiderable.
In addition to the costs, there is another significant disadvantage. If the goods are damaged or stolen, there was no single carrier, you have the burden of proof as to where the goods were damaged or stolen (on the way to Germany, which was still commissioned by the supplier, who may not have taken out insurance or had his own insurance) or only from the port in Germany to you, where your insurance would then cover the liability. This proof is almost impossible to provide, so you will not have any protection in the event of damage.
We therefore advise not to accept CIF delivery from Chinese suppliers. Let us offer you a general FOB offer and organize the shipping yourself or have a forwarding company in Germany carry out the entire import for you.
We recommend: Forwarding agency specialized in shipping from China
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