? Does anybody have any experience importing goods from China?? In our embroidery business I'm looking for better pricing on the backing we use for our patches.? I've received the below quote from a Chinese company and I don't understand what they are telling me.

Thanks,

Dave Davies

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Here’s a doc with a chart breaking down responsibilities and terms for the various incoterms:?

If you can split payment on goods to hold back some monies until you inspect the shipment, that’s best, but you probably won’t be able to do that on a small, first-time purchase.

This is probably a weight without the pallet, which adds approximately 25kg to the shipment. They probably meant “2CBM” not 2CMB, which is 2 cubic meters of volume for the goods. Verify that they will be shipping on a pallet, rather than corrugated cases taped or bound together; the shipment’s odds of surviving the trip go up.

“LCL” is “less than container load” meaning this will be a pallet placed within a shared container being built by the freight company. (A container is about 20CBM.)

I’d suggest using a customs broker to do all the document and coordination work for you. I’ve worked with Charles M Schayer, based in Denver, for the last 15 years or so: they’re straightforward, work at all US ports, only charge for what they do, are small enough that you’ll be working with the same person all the time, and will explain all the moving parts to you.?303-399-5160,??Not only will they handle the paperwork, but they also have agents they trust on the ground world-wide, and can get independent quotes on shipping and services and purchase them when needed. (I bring in yarn and machinery, mostly from Europe.)

To do the work for you, they’ll need you to fill out a form describing your business, and to execute a power of attorney, allowing them to act on your behalf as an importer. They’ll provide all the paperwork. They’ll also need you to purchase a customs bond, which is insurance guaranteeing that all the duties and fees owed to the US Customs and Border Protection folks will be paid, and that the transaction will be completed. You can either get a single-entry bond, which only covers this shipment, or a continuous bond, which will cover all shipments for a year. There’s a crossover point in cost between the cost of the single-entry bonds you expect to need for a year and a continuous bond, which is how you decide which to get. The customs broker will need a copy of your invoice to calculate the amount of the bond - a pro-forma invoice will work, as long as the numbers are correct.

For this shipment, you’ll be paying an entry fee ("destination port charge" in the email) for the goods arriving into Dallas, as well as any tariff duties. You can look up the appropriate harmonized tariff code (here:?) but you might want to ask the shipper what tariff code they use for this material when shipping to the US. Generally, I think synthetic wovens from China are getting a 25% additional tariff, but you’ll need to find out the specific code to tell for sure. (For instance, code?5407.42.00, dyed synthetics, is 14.9% plus the 25% upcharge.) The tariffs are based on the total cost of the purchased material, but not the shipping. For example, your $1,650 will become about $2,300, plus a few hundred dollars in other charges, plus transportation from the port in Dallas to you.

The customs broker can arrange transportation from storage at the port to you; they’ll get the best rate they can, and handle all scheduling. If you’re going to pick up yourself, you’ll need to pick it up in the timeframe stipulated by the port, otherwise they’ll charge you daily storage fees. The free time after the shipment is cleared is usually pretty short, 2 days or so.

Unless you establish payment terms with the customs broker, they’re going to want a check or proof that you sent them a check before they trigger the release of the goods at the port. If you’re picking up the shipment, there’s a release document they’ll supply for your driver.

Finally, a word of caution on wiring funds to an overseas manufacturer. There’s a pretty common scam being used to rob purchasers of their funds when they wire monies to a seller. A third party will compromise either the seller’s or buyer’s email accounts, intercept the email with wiring instructions, and substitute their own bank identification code (SWIFT or other system) and account number. The seller has no reason to distrust the email as the only changes are the bank numbers, and they innocently wire the purchase funds to the third-party account. Unless you have your own business insurance that covers the loss, there is no recourse or refund once the wire leaves your bank. Even if the bad guys don’t hack either email account, if they know of the transaction, and can spoof a decent-looking fake message to you from an internet domain that looks like your seller’s domain, and send the email to you before the seller’s arrives, they stand a good chance of getting you to send them a wire. I’d strongly suggest getting the seller's wire transfer information over the phone, from paper documents or another source verified to be your seller, and *not* from email. (I know about this con from personal experience. Tens of thousands of dollars.)

And that’s a nickel’s worth of advice on importing. Good luck!

Rick

(303) 589-6700

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