How to import cargo from China to USA
I. Cargo import from China to USA Introduction:
The element of Made in China has penetrated into the lives of today’s American people, and a large number of Chinese-made products have been imported into the US market. As the world’s strongest economy, the United States has a huge demand for quality products from China. The range of products exported from China to the United States is very wide, ranging from computers to toys to clothing. According to US statistics, the total value of products imported from China in 2018 reached $539.5 billion. Such a huge market has also given many US importers a huge opportunity to make profits by importing Chinese products.
We know that large US importers have very good resources, and they all have their own procurement department, trade department and transportation department to deal with related issues. (Some even have their own transportation tools). They use resources to achieve efficiency and cost control. But in addition to these large and medium-sized import companies, there is more of a small importer or even an individual active in Sino-US trade. They are large in number, but due to size and cost constraints, they have no way to equip these resources like large importers. However, all the links handled by these resources are indispensable in the import of Chinese products. And it is a ring of tight links. So today I mainly share with you the services that American importers need to import products from China, the problems in various aspects and how to deal with them. By reading this article, you may find a solution to your problem.
- This article will elaborate on all aspects of import trade from the traditional service methods and the innovative service methods of our company.
- The discussion is based on the FCL import to the United States. The selected mode of transport is maritime and related multimodal transport.
II. 5 steps to import Chinese products to USA in the traditional way
In the traditional way of international trade, as an American importer who imports products from China, you will definitely go through the following five links. You must control the whole process in order to receive the expected results.
Step 1 Preparation before import cargo from China
In this step you must complete the following tasks:
1. First, you need to decide what product to import from China.
Now that you have started doing this import business, you have to understand what products are needed in the US local market, what products can make a profit, what products can sell well, and so on. Is the product you want to sell from China? In other words, does China produce such a product? This part of the work must be completed before you start importing. You must conduct a series of work such as market research to complete this part.
2. Find channels to understand the situation of Chinese manufacturers producing such products.
How to reach Chinese manufacturers? This is a very critical issue. You have to determine if it is capable of producing the products you need? What is the company’s reputation? How can I better understand a company? We recommend that you learn in the following ways:
The first way is to go to international exhibitions as much as possible to get the opportunity to meet face-to-face with Chinese suppliers.
Suppliers that appear at the show generally need to pay for exhibitions and travel expenses. They are generally reliable suppliers, otherwise they will not rush to the exhibition to promote products. You can get information about relevant international exhibitions in various ways. If these exhibitions are held in the United States, congratulations, you can easily find some suitable potential suppliers at the exhibition. Know their products through their samples or product catalogs, and get a face-to-face conversation to gain initial trust and lay a good foundation for your follow-up work. If the show is held in other countries or even in China, if you have time and can afford the cost, we recommend that you also try to participate in one or several exhibitions every year. In general, there will be new product launches at the show, which will also benefit you in grasping the market.
The second way is to search for the name of the product you need through the B2B website, so you will find many Chinese suppliers on the B2B website.
In this way, you can also filter the suppliers you need. We recommend that you select suppliers from the paid members of ALIBABA, GLOBALSOURCE and other industry B2B websites. This can avoid some common risks to a considerable extent. After all, paid members of these B2B websites are better. Besides, if there is a problem, you can also make complaints and defend rights through B2B companies.
3. Know in advance the tariffs of imported products in the United States
Because it involves your cost management, you need to know the US tariffs for imported products. If you know the HS CODE of your product, you can check the tariff status of the product click here. It is important to note that the tariffs on products imported from China are under the general item in the picture, as shown below:
The column shows the import tariff rate. If there is a blank, the product is duty-free. But there may be some additional taxes. These tariffs are a headache for the importer at the initial stage. So in this trade link, you need an import customs clearance company to help you control. Otherwise you may have a cost accounting error. Because tariffs as a complex system need to be taken care of by professionals.
The work of Step 1 is summarized as the China product sourcing service, that is, through some channels, you can find potential suppliers of your target products and lay the foundation for the next step of ordering work.
Step 2 Negotiation and signing of orders or contracts
After the preparation of the previous step 1 is completed, you can start negotiations with the selected supplier.
1. Negotiate the product first.
The quality of the product is a key issue and you must be very clear about the details of the product you need. Of course, suppliers can also send their products to you by sample or email, and you can select the products you are interested in.
After initial confirmation (such as by email or product catalog), the safe way is to have the factory mail samples to your company. After getting the physical sample, reconfirm whether it meets your requirements. The advantage of this is that it can eliminate potential differences and avoid problems caused by communication. It is also possible to set standards for the quality of large-scale production in the future in order to protect your own interests.
2. After confirming that the product quality meets the requirements, you can ask the other party for a quote.
The provisions in INCOTERMS mainly define the responsibilities, risks and expenses of buyers and sellers in order to clarify the obligations that each party should perform and provide standards for the smooth conduct of international trade. Then, you must also understand from which departure port of China the supplier’s goods are shipped and to which destination port of USA.
You may ask, how to choose from so many terms? If you are a company that has just been engaged in the import of Chinese goods, we recommend that you use FOB or CIF terms to place an order. Because these two terms are more common, and easier to be accepted by buyers and sellers.
1) If you choose CIF, you need to find out the total cost incurred in the US port (including customs clearance fees, customs duties and truck transportation to the warehouse), and then add the CIF price provided by the factory, you will get your actual arrival cost of goods.
2) If you choose FOB, you have to find out the price of the container sea freight from the Chinese port to the US port, and then add the FOB price to get your total cost.
We simply summarize as following:
Your true cost (to the warehouse)
under FOB terms = factory price + sea freight + customs clearance fee + tariff + US truck fee;
under CIF terms = factory price + customs clearance fee + tariff + US truck fee.
In addition to the information provided by the factory, you are advised to consult a professional freight forwarder who is familiar with Chinese to US container shipping, such as our company of Twings. Professional and reliable international freight forwarders can help you reduce a large amount of work.
Once having determined the trade terms, you can evaluate the supplier’s quotation and if you feel too expensive, you can make a counteroffer. After a series of bargaining, a price that is acceptable to both parties is finally reached.
3. After agreeing on the price, both parties must determine the payment terms.
The payment terms are to specify when the buyer will pay the seller. There are a lot of payment terms, the common ones are T/T, L/C and D/P. Here we will briefly explain. First about T/T. T/T is also called wire in USA.This payment clause is common. That is, the buyer directly transfers the payment to the account designated by the seller through the form of bank wire transfer. This method is simple and saves money.
According to our many years of experience, Chinese suppliers prefer T/T. Because this is safer for suppliers. If you are doing the import business for the first time or just started, we think that you can use the T/T payment method based on the full understanding of the supplier’s reputation. We recommend that you pay a 10-20% prepayment after signing the PO. Then, after the seller has shipped the goods, the balance will be paid. This approach guarantees both buyers and sellers, and this approach is used in many export trades from China to the United States.
4. The buyer and the seller sign a purchase order (PO) to determine the transaction
The format of the PO can be in your own format. If not, you can write EMAIL to us for a template or you can let the supplier provide the PO template. At least the following points should be clarified in the PO:
- The quantity, variety and specifications of the product (this must be clearly written, this can greatly guarantee that the final product you receive is the product you need, not the other product.)
- Terms of trade and prices (must note that the price of the final transaction between you and the supplier must be based on the agreed trade term to prevent disputes between the parties.)
- The latest delivery date (this is to ensure that the supplier delivers before the specified time.)
- Payment terms (please refer to Step 1 above)
- Responsibilities and obligations of both parties (this mainly protects the interests of both parties)
- Mode of transport, port of departure and port of destination
- List of documents required for customs clearance in US ports (this requires you to consult your customs clearance company, generally including bill of lading, invoice, packing list, etc.)
Step 3 Supplier Production for cargo import from China
After signing the PO, the order has entered a substantive phase. At this time, you can probably be a little more relaxed, and there is not much work to be done, including:
1) Unscheduled request for factory feedback on order production,
You must urge the factory to complete the production and shipment of the product in time according to the requirements stipulated in the contract.
2) If there is a problem in the production process, how to communicate?
If there is a problem in the production process, such as the factory delays the delivery date for some reasons, or the factory needs to slightly adjust the product details in the actual production process. In this case, we recommend that you stick to your own principles and strive for your own interests. If it is for objective reasons, you can also give the manufacturer a little space. If not, then you need to stick to your own ideas. You’d better ask the factory liaison staff to report the problem to his superior in order to better protect your own interests.
Step 4 Process shipment, payment and documents for cargo import from China to USA.
This step mainly includes the following
1. Container booking, inland transportation, and customs clearance for Chinese exports.
1) If you are using the CIF terms,
Then you only need to wait for the seller to provide the documents specified in the PO, after the verification is correct, pay the seller, and then let the seller deliver the documents to you.
2) If you are using FOB terms
This step takes a few days in advance because the international freight forwarder needs 7 days in advance to prepare for FCL sea freight booking. So you have to know the time of the factory readiness with the goods 7 workdays in advance, and then inform your freight forwarder to get in touch with the factory. You also need to communicate with the freight forwarder, what schedule is appropriate, what kind of shipping company to choose, and so on. So it takes time, you must set aside at least 7 days in order to have sufficient time to process.
2. Other issues you need to do during the shipment from China.
1) Provide accurate consignee information so that the freight forwarder can declare AMS and ISF, which is very important in the United States. If you delay the declaration or wrongly declare, you will face a huge fine. These things, a good international freight forwarding company will assist you.
2) Check the contents of the bill of lading in time and urge the issuance of the bill of lading, because the bill of lading is the only document of title for obtaining the goods at your port of destination.
3) Let the supplier provide the documents after the actual packing in time to pay according to the actual amount.
3. Payment against documents for the shipment to US
Under T/T conditions: After determining the shipment of the goods and obtaining the COPY for the negotiation documents, you should pay the balance to obtain the documents required for customs clearance in a timely manner. Because it is from Shanghai to LA in the US, container shipping usually takes about 18 days to arrive. Therefore, timely payment of the balance is conducive to early delivery, avoiding the ship company’s high demurrage and port detention costs (the US port generally offers the FREE TIME within 7 days). After the payment, you need to send the bank receipt to the supplier in time, urging the supplier to deliver the document to you in time after receiving the payment. It is worth mentioning that in most cases, Telex release is adopted for the customs clearance in the US, and only copies of invoices and bill of lading are required. Therefore, after the payment is received, in order to save time, the supplier can also directly discharge the cargo to the consignee by telex, and send the scan-copies of invoice and bill of lading to you. This is faster and more concise.
Step 5 Customs clearance for cargo import from China by the buyer
After obtaining the documents required for customs clearance in step 4, the container arrival status should be tracked in time, and the documents should be handed over to your customs clearance agent in time.
What you must know is that in the US the consignee must buy BOND for customs clearance, if not, will not be able to clear the customs. So you must first confirm whether your company has BOND. If there is no BOND, you can use the following two methods.
1) Contact your customs clearance agent or other agency to buy a BOND for your company.
If your company only needs to import several times a year, then SINGLE BOND is recommended. If your company needs to import goods frequently, you can purchase ANNUAL BOND.
2) Find a suitable agency to help you provide BOND
This is also very popular in the US. In this case, you need to use the agent company as the consignee, and then deliver the goods to your company after customs clearance.
We suggest that from the perspective of cargo safety and long-term operation, you use your own company to purchase BOND for clear customs. This has great benefits for your import credit. Your customs clearance agent can use your documents to declare import customs clearance before your container arrives in the port. The customs will then provide tax bill for your tax payment according to the products, amount and quantity declared by you, as per the relevant US customs laws. After that, there will be another two occasions:
1) If everything is OK, the customs will release the goods directly.
At this time, you can inform your truck company to pick up your container cargo with the delivery document, you only need to unload the goods at the warehouse door. However, it should be noted that due to the high labor costs in the United States, truck companies will only give you 1-2 hours of free unloading time after arriving at your warehouse. If it is exceeded, he will charge you an additional fee.
2) Customs inspection
If the Customs believes that the products you declare need to be inspected, you will be notified of the notice and dispatched personnel to open the box at the agreed time. If your product matches the documents you provide, Customs will release it immediately. If there is a clear discrepancy, then the problem is big, you may face customs fines or need to pay taxes, and even more serious consequences. So be sure to let the supplier provide accurate packing data, no errors.Customs inspections will incur inspection fees. In the US, labor is very expensive, and if the inspection process cause an operation of container unloading, the cost is 900-1000 USD.
As a conclusion, the import customs clearance is also explained. The main problem in this part is to prevent the cargo information on the document from being inconsistent with the actual situation. If the consistency achieved, you can relax with no concern of possible customs inspection which shall not affect your normal business. (You may only need to include the cost of the inspection in your costs to prevent losses.)
III Summary of traditional import procedures
The above five steps basically outline the general steps you take to import products from China to the US (of course, if you use express or air transportation, it may be slightly different, we can also write an operation guide for you.), if you strictly follow the five steps one by one, you will be able to successfully purchase the products from China.
IV Our innovative one-stop agency service allows you to get rid of the constraints of traditional models
Thank you for insisting on reading here, you may feel that the traditional way of import trade requires the importer to handle too much work, including suppliers, customs, freight forwarders, truck companies, etc., too many things, too much Unfamiliar field. If you are not careful, there will be problems. Improper handling can result in a lot of costs and unknown risks. A general freight forwarding company may provide some assistance in transportation and customs clearance. But we think this is not enough. Therefore, our company Twings has launched an innovative one-stop foreign trade agency service, which allows you to avoid the cumbersome problem of dealing with multiple units, focusing on your products and market.
1. What is Twings’ one-stop foreign trade agency service?
Simply put: our one-stop foreign trade agency service is = SOURCING service + export agent service + freight forwarding service + customs clearance delivery service. You can be greatly liberated from the five cumbersome steps of the traditional import trade mentioned above.
2. How do we serve for cargo import from China?
In the previous steps, you can clearly see that your company needs to deal with multiple parties. Our service simplifies this aspect, so you only need to contact us one-to-one, leaving the handling of multi parties to us. As a company with many years of experience in the foreign trade and freight forwarding industry, we can sort out various relationships to better serve you and ensure the smooth completion of your import business.
corresponding to the five steps of the import trade mentioned above, the details of our services are as follows.
Step 1: Preparation before import cargo from China
1) For suppliers you find through exhibitions or other information channels, we can provide in-depth surveys on issues such as supplier qualification and credit. We are located in China and are familiar with how to investigate the credit of a Chinese company. Through paid services, we can check whether your potential suppliers have credit defaults, whether there are lawsuits, whether they have been punished, and so on. Choosing a supplier with no bad records will greatly reduce your risk.
2) If you only have pictures or product information, you can also entrust us to find the right supplier. Our team has 18 years of foreign trade experience and has direct supplier resources for many products, from LED lights to children’s toy cars, from textile fabrics to mechanical and electrical products. More importantly, we are familiar with the distribution of China’s industrial belts, and can find the products that match your products based on your detailed information.
Step 2: Quote and contract signing for your cargo import from China
1) You will enjoy the Chinese export tax rebate. The Chinese government provides tax rebate subsidies for export business. You can also enjoy this preferential policy through our one-stop agency service.From our service, you get direct benefits, which is more cost-effective than the price directly obtained from the supplier.
2) Through our service, we can sign Chinese contracts with domestic suppliers. As everyone knows, rights protection in international trade is more troublesome. If you use our services, our purchase and sales contracts with our suppliers are fully protected by Chinese law. If there is a risk of default, we can better protect your rights.
3) We can directly visit the supplier factory and provide you with first-hand product information, including videos, photos and so on. You can also go to the workshop and ask some professional technical questions.
Step 3: Supplier Production for cargo import from China
At this stage, we can go to the factory on your behalf, check the production schedule regularly, and report to you. If there is a problem, we will communicate, negotiate and process with the factory according to the contract. Because we have the advantage of Chinese native language, communication will be more direct and smooth.
Step 4:Process shipment, payment and documents for cargo import from China to USA.
This part is our core service. We have been in the international freight forwarding industry for nearly 20 years and are familiar with all aspects of Chinese goods export. If you choose our service, you will not have to worry about:
(1) What is the proper schedule?
(2) When is the box available?
(3) How to inspect the goods
(4) How many days does it take to get to China’s shipping port?
(5) Collection of documents
(6) Requirements for other documents, such as AMS, ISF, etc.
You only need to confirm the plan we propose (we usually give you multiple options for you to choose.). And we will get everything done.
Step 5: Clearance for your China import cargo at the destination port
This part is actually an extension of step 4, and is essentially a category of international freight forwarding. We have our own customs clearance agents in the United States, as well as cooperative truck companies. If you use our services, the documents and customs clearance involved in this part are all handled by us. You only need to wait for the container to arrive at the warehouse and arrange the unloading.
Summary: You can clearly see that the traditional five-step workload has been reduced by 85% through our one-stop agency service. Working with us, you may only need to conduct market research and participate in the exhibition, and other work can be handed over to us.
3. How to save costs for your cargo from China?
(1) As mentioned above, we have simplified the steps, compressed your workload, and saved you time.
(2) Through our agency service, you can directly enjoy the tax rebate that Chinese foreign trade companies can enjoy. This is very beneficial. The truth is that you have skipped the profit link of a foreign trade company. Your price competence will be enhanced greatly against competitors.
(3) Through our agency services, you can save money on freight forwarding. You should be well aware that under CIF or FOB conditions, the logistics costs given by the factory are not likely to be the bottom price. Instead, his cost is the quotation price given by the freight forwarder. We are a company in the freight forwarding industry and definitely have a discount on the price that the factory gets. So you can save this part of the cost. The costs of the US side are similar. Because of our large demand, we will definitely get a much lower price than the price you get.
In summary, the cost of these three aspects can be reduced. Even if the cost of item 2 and 3 is neglected, the cost savings of item 1 are the most critical.
4. Why us Twings for your cargo shipping from China to USA ?
Our company is a formal international freight forwarding company registered under the Chinese industry and commerce, and also has the NVOCC certification of the Ministry of Communications. We also have a registered import and export company that can provide you with qualifications for export. Our company team has more than 10 years of experience in foreign trade export and international freight forwarding operations. For details, please read the ABOUT US page of our official website for more detailed information. Also look at how our customers evaluate us?
5. If you want to import products from China, we are your suitable partner.
After reading the article above, I believe you should have felt the attractiveness of our service. Please don’t hesitate to contact us, we will give you a fantastic experience.