Ocean freight shipping is a massive industry. Almost any trade or business will have had contact with ocean freight shipping at one point. If you’re thinking about dipping your toes into the business world and are considering using ocean freight as your main mode of transportation, there are certain misconceptions you need to be aware of.
Get familiarized with the facts to avoid nasty surprises, which could lead to unnecessary delay costs. In this post, we’ll address the top misconceptions of ocean freight.
Not entirely true. Yes, shipping has its costs. But compared to other modes of international transport, shipping is definitely the most cost-efficient. If you didn’t already know, shipping accounts for 90% of world trade. That said, it is clearly the best and most cost-effective option for importers and exporters worldwide.
If you’re moving overseas and are looking to send your household goods by sea, reducing the number of belongings for your move could reduce the cost. If you’re looking for a cheap way out, perhaps it’s best to consider leaving these behind (depending on their value) and purchase new furniture at your new destination country.
At the end of the day, your final shipping price would largely depend on the amount of merchandise you’re shipping. And this brings us to our next point.
False. Everything you put into the container needs to be listed on the packing list, which is then submitted to customs control for inspection. Every country has its own regulation of certain goods and merchandise. Some items may be prohibited, while others may require you to obtain a special license in order to allow entry. For example, if you’re looking to ship wood-related items or have wood packaging material, you must ensure that they’re pre-treated. When in doubt, always check with your freight forwarder.
You couldn’t be further from the truth. Not only do container shipping rates fluctuate regularly, it’s also subject to many factors - some beyond your control. These include seasonal, political, economical (demand and supply) factors. You should also get familiarized with the concept of General Rate Increase, or GRI, announced every now and then by shipping lines.
Sound the alarm! Even though only a small percentage of containers are inspected worldwide, you should never take for granted that your shipment won’t be tagged (randomly or otherwise) for inspection. This figure is higher for shipments arriving in the US. But not by much - 5%. US Customs have only gotten more stringent over the years and that said, you should always be prepared for the eventuality of an inspection.
The latest figures show that only 74.7% of all vessels arrived on time. In other words, one out of every four shipments arrive late. If you think you can plan your logistics according to the estimated date of arrival indicated by shipping lines, think again. Carrier schedule reliability has fallen from last year and it’s still making its way back up to the on-time rates it had before. Late arrival isn’t an uncommon occurrence and this may be a result of various factors including natural phenomenons such as hurricanes, large volume of cargo, etc. Keep up with the latest ocean freight news to stay up to date with the latest industry happenings.
Even if your merchandise gets to the destination port on time, it’s not to say that you will be receiving these merchandise immediately. Truck drivers shortage is an ongoing problem in the United States. Around 70% of the goods consumed in the US are transported on the highways. And according to a recent report, 90,000 new truck drivers are needed every year in order to keep up to the rising demand. With the implementation of the ELD mandate looming, we could also start seeing more delays in delivery as truckers have no choice but to comply with the driving hours limits.
Chassis shortage is also a long-standing problem, especially since shipping lines stopped supplying them. This actually forms one of the top delivery and pickup problems in the US. If you’re having your goods picked up in less-accessible areas, be prepared to wait. It’s not always possible but in general, it’s advisable to have a flexible date. Also, do a check of what carriers and chassis are available in your pickup area. Contact your freight forwarder should you have any questions.
Yes and no. Like a broken disc, we’ve stated time and time again that shipping is an extremely complex process and we’re not about to retract that. With all the paperwork that goes into the process and the potential problems your shipment could face, we could never guarantee a completely smooth sailing shipping experience. However, these complexities aren’t difficult to overcome. Select a reliable and reputable freight forwarder to handle your shipment and these troubles are minimized. Make sure the NVOCC you choose is FMC-licensed to avoid potential complications.
iContainers has ten years of online freight forwarding experience and is an FMC-licensed NVOCC in the United States. Our objective is to reduce the shipping industry’s complexities by adopting the latest technologies to introducing transparency and ease. Do check out our Track & Trace and automated notifications features.
"Customs duties play an important role in your international shipment. How they're determined and calculated varies from country to country"
Klaus Lydsal, vice president of operations at iContainers