The International Shipping Process – Step by Step
The International Shipping Process – Step by Step
The international shipping process consists of key stages, including request, documentation, packaging, customs clearance, transit and final delivery. Each step is crucial to ensuring smooth logistics, minimizing delays and complying with international regulations. Grand Logistiks can facilitate this process by offering service at every stage and ensuring the efficiency and safety of international shipping for your cargo.
International shipping can be complex and sometimes confusing, with many obstacles and difficulties to overcome along the way, working with a qualified forwarder is the best way to ensure that the shipping process runs as smoothly as possible.
We always try to be helpful to our customers and not only. We will try to explain the international shipping process step by step so that anyone who is yet to import or export goods can gain an idea.
The first step in the supply process is when an importer (also known as a consignee ) orders goods from a supplier (also known as a shipper ). In a typical import, buyers typically request a quote from suppliers when considering goods for purchase. The quote may often be accompanied by or take the form of a pro forma invoice . A pro forma invoice is a factual invoice that is used to provide an estimate and can be amended. This is different from a commercial invoice , which is a final and formal invoice used for customs declarations. Once the quote is approved, the consignee often creates a purchase order . A purchase order is simply a contract that details the order and the price of the goods. Depending on the business, a detailed purchase order will also contain an estimated delivery date, origin and destination addresses, and cargo dimensions.
When a buyer issues a purchase order to a supplier, the contract must be governed by Incoterms . Incoterms are essentially the terms that allocate costs and risks between the buyer and seller during delivery. They essentially determine who is responsible for what while the goods are moving from point A to point B. It is extremely important to choose a set of Incoterms that is most appropriate for the transaction, because failure to implement the correct Incoterms can cost the buyer a lot more money than initially expected. Incoterms will also determine which party should engage a freight forwarder for the various stages of the delivery process.
Once a purchase has been agreed upon, a freight forwarder is hired to manage the transportation of the goods from point A to point B.
When an order is placed, a common way to pay the supplier is by obtaining a letter of credit. Many buyers use this because it is one of the most secure payment methods in international transport. It is essentially a binding legal agreement issued by a financial institution (such as a bank or insurance company) guaranteeing payment for the goods.
This is followed by the provision of the order confirmation and the issuance of the commercial invoice, which is a key document that states the price and quantity of the goods sold, and most often the Incoterms terms.
If you are working with an independent freight forwarder, the agent you have worked with will contact their overseas partner to arrange for the goods to be picked up. The overseas representative will in turn contact the relevant supplier and arrange for the export of the goods to the buyer. This will include the preparation of several key documents used in the process of international freight delivery, which are required for customs purposes.
Documents that must be prepared by the supplier are: a packing list, a Certificate of Origin, a letter with instructions from the shipper, a Manufacturer's Declaration, in which he declares information such as whether the goods are toxic or hazardous, as well as what materials the goods contain and, if there are such goods, a Dangerous Goods Form(s).
Each country has different requirements for customs clearance of exports and your freight forwarder will provide you with full information on this. Here are some examples of essential documents that are required - Export Declaration, Export/Import Permit for Prohibited Goods if the goods are such and must travel with a special certificate, Declaration of Value of Goods is also often required for various countries above a certain value and the importer, Warehouse Declaration if the buyer intends to place their imported goods in a warehouse before clearing them through customs. Please note that all of the above can be processed on your behalf by a licensed customs broker and freight forwarder, whom you will need to authorize.
Once the necessary documentation has been arranged, the supplier must make a request or reservation for transport. It is extremely important to book freight transport early to avoid disappointment, especially if the goods are to be transported during a peak shipping season.
Once the goods are packed and ready, they will most often be transported to a warehouse where they will be stored until the day of export. When the carrier arrives to collect your cargo, a bill of lading is issued, confirming that the goods were received by the carrier in acceptable condition. This is an extremely valuable document, as it acts as proof of legal title to the goods. Several bills of lading may be included in a single shipment. For example, a supplier may require an “internal” bill of lading if the goods are being transported from a warehouse to a seaport, and a separate bill of lading may be issued by an ocean carrier to the supplier if the next leg of the journey is by sea, for example. The supplier will then need to provide the bill of lading to the consignee (i.e. the buyer). The buyer will need to present the bill of lading to secure the release of the shipment and claim ownership of the goods. Again, this can all be coordinated through a freight forwarder.
Prior to departure, the goods will be processed through export customs clearance. This is the process where all documentation is reviewed and verified by government agencies. If the export is cleared, these goods will be placed in international transit, and once the buyer’s goods arrive in the country of destination, they will go through import customs clearance. Imported goods may be subject to certain taxes, tariffs, and/or fees. Depending on the commodity, the goods may also be subject to quarantine inspection upon arrival.
Once the goods have cleared customs and are ready for shipment, they will be delivered to the buyer or to the agreed upon delivery point. And if you still have questions about any part of the shipping process or if you would like to learn more about importing or exporting a specific product, please do not hesitate to contact us!
See more:
Freight quote and transport request
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What to Look for in a Good Freight Forwarder