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I thought this was interesting - paperwork costs more than the actual freight!!

 

Australia’s containerized sea cargo supply chains suffer from over $1 billion of embedded unnecessary costs. Every container shipment in global maritime trade today requires on average approval from 30 disparate organizations and more than 200 document verifications. In fact, the cost of processing documents and information for every container shipment is estimated at more than twice the cost of the transport. Through blockchain, IBM estimates that up to 20% of unnecessary supply chain logistics costs could be cut, resulting in billions of dollars saved.

 

Still WAY too much. No wonder production costs are high!

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I thought this was interesting - paperwork costs more than the actual freight!!

 

Australia’s containerized sea cargo supply chains suffer from over $1 billion of embedded unnecessary costs. Every container shipment in global maritime trade today requires on average approval from 30 disparate organizations and more than 200 document verifications. In fact, the cost of processing documents and information for every container shipment is estimated at more than twice the cost of the transport. Through blockchain, IBM estimates that up to 20% of unnecessary supply chain logistics costs could be cut, resulting in billions of dollars saved.

 

Still WAY too much. No wonder production costs are high!

Is that the Aussies suffering from their Sclerotic Bureaucracy or the Aussies suffering from a Global Bureaucracy ? 

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It’s a global thing. The single greatest innovation that happened to the global supply chain & shipping industry was the introduction of the 40ft standard container. It made the whole process about 90% more efficient but that was decades ago. If a container falls off a ship on a storm today it can take up to 2 years to settle the loss / claim - due to paper chain of different agents and parties in the mix making it hard to confirm exactly who owned what at the time of the loss and who was responsible (exporter, importer, shopper, agent, trade finance / bank, insurer, buyer, seller of goods, finished item or part finished, value at time of loss, local import regulations, taxes, tarrifs, trade embargoes etc etc etc). The new blockchain technologies being deployed in this space are designed to standardise all of this and make it more transparent to all parties and therefore instantly clear what’s happening and who is responsible / liable.

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Australia is a "walk in the park", you want to try importing something into Brazil.

The list of tariff classifications is over 1000 pages and then there are the arguments about which tariff is applicable.

Then there are all the other taxes to be considered, all with an associated processing cost....

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In fact, the cost of processing documents and information for every container shipment is estimated at more than twice the cost of the transport. 

 

I'm not surprised and I bet a majority of it is due to inefficient, unproductive, bureaucratic red-tape.

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The actual line on the invoice that say 'freight cost' are usually a small % of the price.

For full 20ft containers (FCL) the fright cost is around 50%, if they are 40fters then it's higher.

For LCL, less than a container load, which is how much travels the freight cost itself can be as low as 10% of the invoice costs.

It is very common to get a invoice with 20 lines of fees, levies, taxes and so on plus one line that is the actual freight cost.

We send stuff to Aussie a lot and a recent one was 700 odd, of that 140 was the freight costs the rest was fees and taxes.

We sent a shipment of rope direct from our factory in Japan to a company 10 miles from the US wharf. It cost 500 odd to get it picked up from the factory, taken to the ship,the ship sail 1/2way around the world to the US wharf. It then cost 1500 to get it from the ship to the receiver. Going into Aussie is not much different, they also have fees and taxs out the wazoo.

Knowing stuff like that is why when I see someone wanking on about cheaper to buy it overseas I just see an ignorant muppet, the same muppet who is also a deliberate tax dodger.

 

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Don't you think some exporters/ importers may get much better container / fright rates than you? ( like Alibaba) and thus this is why people get a better price for the same spec'd product from overseas.

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On 27/03/2020 at 10:10 AM, Knot Me... maybe said:

 

It is very common to get a invoice with 20 lines of fees, levies, taxes and so on plus one line that is the actual freight cost.

 

And each line had different tax applicable, a trap for the inexperienced when entering into the accounts system.

For added fun.. the freight forwarder’s GST total used a rounding system that must have been based an rolling a dice.  

 

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3 hours ago, Sailing NZ said:

Don't you think some exporters/ importers may get much better container / fright rates than you? ( like Alibaba) and thus this is why people get a better price for the same spec'd product from overseas.

Better? Yes.

Much better? No.

Better enough of a difference to make a significant one on the shelf? A solid No.

The freight component is variable due to when, ship speed, size of box, time of year, shipping companies just wanting more money. But of the whole fright invoice it is one of the few that is and it is very rarely the majority of the invoice total, most are fixed costs whether you bring in a 40ft container or a feather. Customs and the other monopolies with their fingers in there have no need to do deals for anyone and they don't.

And I reject your blanket claim you can buy the same spec oversea cheaper. In some case oh hell yes but in all, absolutely not.

 

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When I used to import Sound equipment, I was often shocked at how little freight cost. I was not a large importer. I did not have regular shipments. The Shipments were often only Pallet sizes. I had a freight forwarder that did all the paper work for me, because that is huge an complicated. I just paid the bill, of which was often so low, I could not believe how little it cost. The actual freight charge was high, but all the handling and Customs and blah blah was so cheap, I could not understand how the forwarder made money. All I had to do was place the order and notify the forwarder and then wait.

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