WHAT ARE YOUR FREIGHT
OPTIONS?
Air Freight
Sea Freight

Direct Service

Transhipment Service

Courier Service
 Full Container Load
(FCL)
o Direct
o Transhipment
 Less Than Container Load
(LCL)
When to Use Air Freight
 Value of your goods
o I-pads vs. Plasticware
 Stock Cycles
o How quickly are they selling?
 Size of your Shipment
o Under 50 – 100 kgs?
 Timing
o I need this in a hurry.
Direct Services
Shanghai to Sydney
Direct Carriers
Flying Time of 11 hours
TRANSHIPMENT SERVICE
Shanghai to Sydney
Via Hong Kong [Cathay Pacific]
Shanghai to Hongkong
2hrs 30mins
Hongkong to Sydney
9hrs 20mins
= 11hours 50mins ???
Air Freight Transit Times
 Direct Flights
o Hongkong
o Shanghai
o Beijing
9-10hours
10-11hours
12-14hours
 Transhipment
o 2-3 days
o Can be longer in Peak Season with backlogs
Direct Versus Transhipment
Direct Service
Transhipment Service
 Guaranteed to arrive
when loaded
 Cheaper than direct
service
 Quickest possible transit
time
 Slower transit time
 More expensive freight
cost
 Possibility of getting
stuck in transhipment
port [especially during
peak season]
FREIGHT COSTS
OVERSEAS CHARGES
 Inland Freight
 Export Customs
 Documentation
 X-ray/Security Screening
 Airport Terminal Fees
 Air Freight
 Fuel Surcharge
 Security Surcharge
LOCAL CHARGES
 Airport Terminal Fees
 Breakbulk Charges
 Documentation
 Air Cargo Automation
 Customs Clearance
 Delivery
 Fuel Surcharge
DIRECT VERSUS TRANSHIPMENT
DIRECT SERVICE
 Fastest possible transit
time
 Guaranteed to arrive
when loaded
 Usually more expensive
option
 Less Handling – Less Risk
TRANSHIPMENT SERVICE
 Container transferred
from one vessel to
another
 Sometimes, your only
option
 Potential for delays
during Peak Season
 Longer transit time
 Cheaper price ?
SEA FREIGHT TRANSIT TIMES
 Direct Services
o Hong Kong / Shekou / Nansha
o Shanghai / Ningbo / Xiamen

o
o
o
Transhipment Services
Huangpu / Shantou
Tianjin / Dalian
Hong Kong/ Shanghai
Via Shekou
Via Busan
Via Singapore
10-12 days
14-16 days
14-16 days
24-28 days
20-25 days
Freight Calculations
F.C.L Cargo
Freight charges are
paid based on size of
container –
o Per 20 Ft Container
o Per 40 Ft Container
L.C.L Cargo
L.C.L Cargo is charged
per –
o Cubic Meter
o 1,000 Kgs
Whatever is the
greater.
Freight Costs
Overseas Charges
•
•
•
•
•
Inland Freight
Export Customs
Documentation
Bill of Landing Fee
Terminal Handling
Charge
• Ocean Freight
• Bunker Surcharge
Local Charges
•
•
•
•
•
•
•
Port Charge
Terminal Handling Charge
Sea Cargo Automation
Delivery Order Fee
Terminal Security Fee
Customs Clearance
Delivery
Overloading Containers
• Overloading container is illegal & extremely dangerous.
• Average guide for container + goods is 23.5 tonnes
• R.T.A sits outside gate at Port Botany to check trucks
• R.T.A works off axle weights.
• Important that load is evenly distributed in the
container.
Weight Distribution In Container
 Incorrect load
distribution.
 Load not evenly
distributed.
Weight Distribution In Container
 Correct load
distribution
 Load evenly
distributed
WAREHOUSING AND LOGISTICS
OPTIONS FOR NEW IMPORTER
Start your own warehouse.
Rent space in existing warehouse.
Outsource to 3PL company.
Just-in-time Delivery Model
YOUR OWN WAREHOUSE
PROs
 Master of your own destiny.
CONs
 Tied to a lease.
 Handle goods way you want
to.
 Additional costs – forklifts,
pallet hire, labour, etc.
 Extra care – minimise damage
 Higher insurance premiums
 Provide most flexible service
to your end-customer.
 OH&S / Workcover compliance
RENT SPACE
PROs
• All the “PROs” of your own
warehouse
CONs
• Some of the “CONs” of your
own warehouse
• Possible sharing of costs –
forklift, labour, etc.
• Difficulty in finding right
situation
• Potential to take over more
space as business grows.
• Conflict with resources
3rd PARTY LOGISTICS PROVIDER
PROs
• Most cost-effective for startup operation.
CONs
• Lose control of your cargo
• No lease or equipment costs.
• Less flexibility in servicing
your customers
• No OH&S/Workcover
compliance issues.
• Increased risk of damage or
loss
• Piggyback on existing
distribution services.
• Increased risk of error?
Just-In-Time (Cross Docking)
PROs
• No warehouse, labour, or
equipment costs.
• Less handling = less cost in
your supply chain.
• Most cost-effective model.
CONs
• Least flexible model.
• No stock on hand for
emergencies.
• Need accurate usage forecasts
from your customers.
TRANSIT TIMES TO PERTH
PROs
CONs
• Air
• 5-6 hours
• Truck
• 4-5 days
• Rail
• 8-10 days
• Ship
• 12-14 days
DOMESTIC AIR FREIGHT
 Can be very expensive compared to international air freight.
 Less options, less competitors.
 Mainly serviced by narrow-body aircraft.
 Only used in emergencies or for high-value cargo
 Rates charged on “per kg” basis
 Beware volume/weight ratio.
TRUCKING
 Most common form of domestic contribution.
 Good balance between price, speed, and flexibility.
 Plenty of operators and competition
 Rates charged on “per kg” basis
 Weight/volume ratio either 1cbm : 333kgs or 1cbm per
250kgs
 Pallet rates can be obtained for regular business on
mainline routes e.g. Sydney / Melbourne.
RAIL
 Mainly used for long haul.
 More cost effective than trucking
 Suitable for large loads i.e. rail containers
 Container rates based on weight ---- heavy containers
cost more.
 Have to get container to rail yard at origin.
 Have to collect container from rail yard at destination.
COASTAL SHIPPING
 Only suitable for full-container loads
 Only viable for long haul e.g. Sydney – Fremantle
 Cheapest way to ship goods to western Australia
 Still have to deliver container to terminal.
 Still have to pick up container on arrival
 Container rates charged same as international shipping
i.e. per 20ft/40ft/40ft high cube.
INSURANCE
INSURANCE
 Should I take out marine insurance for my cargo?
YES
 Should I let my supplier take out marine insurance on my behalf?
NO
 Are marine insurance premiums cheaper in Australia?
Usually, YES
 Will I have less problems if I insure from Australia?
YES
AUSTRALIAN INSURANCE CUSTOMS AND QUARANTINE
BASIC QUESTIONS PRE-IMPORT
1.
2.
3.
4.
5.
6.
7.
8.
Is the commodity prohibited from importation into Australia?
Are there any restrictions from importation into Australia?
Are there any Australian Quarantine restrictions or prohibitions?
Does my commodity need any special treatment/s prior to import?
Do I have packing that requires treatment prior to import?
Do I have all the required documentation / paperwork?
Is the documentation/paperwork accurate?
If FCL container: does the combined weight comply with the relevant state
transport requirements?
TREATMENT REQUIREMENTS FOR SEA CARGO
 Wooden packaging utilized in in FCL/LCL consignments should be treated
using any of the options available for wooden packing.
 Such consignments must be accompanied by an acceptable Treatment
Certificate.
The acceptable methods of treatment are:
• Fumigation
• Heat Treatment
• Permanent Immunisation Treatment
 Treatment Certificates are not required for:
• New Processed panel product
• Timer treated and marked in compliance with IPSM 15
Questions and Answers
 What happens if my goods are not accompanied by a packing
declaration?
A: If a valid packing declaration does not accompany a sea
consignment, the consignment will be directed to AQIS for an
inspection to verify whether or not wood packing and/or and straw
are present.
 What happens if timber packing is not treated when they arrive in
Australia?
A: If a valid treatment certificate does not accompany a sea
consignment, the consignment will be directed for treatment,
destruction, or re-export of the packing material from Australia.