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According to the U.S. Department of Commerce, American companies
lose more business in the movement of products overseas than in
any other phase of the export process. Overseas shipping involves
modes of transportation, packaging requirements and documentation,
all of which are very different from the requirements for domestic
shipping.
The Need for Packing
How to Reduce Your Losses
Cargo Insurance
Shipping Systems
Barge on Board System
Roll-On/Roll-Off Service
Products Frequently Shipped
by Air
Typical Commodities Transported
by Air
The Need for Packing
Proper packaging is essential to contain,
protect, and offer a means of handling the product. Each package
design has the goal of protecting the product from the assembly
line to the user. There are many hazards of domestic distribution,
but increasing the amount of handling increases the probability
of damage. Poor quality packaging leads to damage, decay, establishment
of low prices, or in extreme cases and the outright rejection by
the buyer.
The method of packing or shipping will depend
on your product and the infrastructure of the country of destination.
Before agreeing to a letter of credit, ensure that the necessary
infrastructure is in place in your destination. Pack your goods
accordingly to avoid unnecessary losses during the shipment. Be
sure to research the capability of the country because refrigeration,
loading, and storage facilities may not be adequate for your product.
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How to Reduce Your Losses
The type of materials used for shipping will vary
according to the product, the type of transportation (ocean or air),
and the ultimate destination. However, the basic principle of packaging
is known as the "unit load' concept or "unitization."
Unitization is based upon the theory that all shippers should pack
their cargo so it may be moved and handled entirely by mechanical
equipment, such as lifts and cranes, throughout the distribution
network. This practice reduces the need for labor, the handling
of boxes, and the amount of damage. Also, it allows for faster loading
and unloading by transportation equipment, more efficient distribution
center operations and a reduced level of pilferage. The reduced
costs of the distributor in terms of labor and time often result
in cost discounts for the exporter.
In practice, the unit load concept means that
small, highly expensive items, such as calculators, should first
be totally enclosed in wood boxes, or double, even triple wall containers
to avoid pilferage and damage. Second, the boxes or containers should
be secured to pallets with shrink-wrap or steel strapping. Large
items can be secured directly to pallets, assuring that they are
adequately protected from damage.
Packaging materials should be selected on the basis of product and
environmental considerations such as temperature, humidity, desired
atmosphere around the product, packaging strength, cost availability,
buyer specifications, graphics, labeling, freight rates and government
regulations. Packing procedures should adhere to the following recommendations:
- Your product should be properly cushioned or blocked within
the container to prevent movement or rubbing against other products.
- Select the most advantageous pallet size and style. A four-way
entry pallet permits handling from all four sides with a fork
or pallet truck. Additionally, the standard size pallet size of
40 inches by 48 inches (1000mm x1200mm) maximizes the volume,
which can be loaded into shipping containers.
- Prepare ferrous surfaces with a rust inhibitor to enable your
product to arrive at its destination free from rust or corrosion.
- Drain holes should be made in the skid or floor area of large
containers, boxes or crates. This will allow seawater or condensation
to flow out of the container.
Do not overload the containers, as the weight might exceed the
limitations of the container.
- Keep markings to a minimum. Do not add trademarks or product
descriptions to the box. Marks should be applied with waterproof
ink to three surfaces of the container. Cautionary markings should
be in English, the language of the country of destination and
the international graphic-handling symbol.
An export packer (listed in the Yellow Pages under
"Packing and Crating Services") is an excellent source
for packaging materials and advice. In addition, contact your shipping
company for more specific information regarding pallet size, weight,
and design. Freight forwarders offer packing services and information
about packing requirements for different countries. Most likely,
it will be easier to use a freight forwarder who can assist with
the entire shipping process rather than separate shipping and packing
companies.
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Cargo Insurance
The purpose of cargo insurance is to protect the
cargo owner's financial interests while their cargo is exposed to
the risk of transit. Air and ocean carriers provide limited coverage
while a shipment is in their possession. Cargo insurance requires
a bill of lading, which states the liability assumed by the carrier.
When an exporter files a claim against a carrier, it has to prove
that the carrier is directly responsibility for the loss. Outlets
for obtaining cargo insurance are a freight forwarder or a company
specializing in ocean and air cargo insurance.
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Shipping Systems
Goods can be moved to the foreign markets by
sea, air or land transportation. When selecting a mode of shipping,
consider product characteristics such as size and value, destination,
perishability, the required speed of delivery and cost. Compatibility
with the other elements of your distribution system such as packaging,
warehousing, inventory control and handling should influence the
decision as well.
Ocean shipping is the most commonly utilized method
of shipping with three primary types of transport. First, bulk shipping
is used to transport large amount of goods such as grains, logs
and fertilizers. In bulk shipping, the entire hull or shipload is
filled with the product. Second, the breakbulk type of ocean shipping
is used when the product is loaded on and off by individual piece
or bundle of cargo such as palletized cargo. These ships normally
can handle dry or refrigerated cargo. Third, the containerized type
is when the product is loaded into containers and moved from door-to-door
without the contents being handled. It is the most common method
used to transport high-value or value-added agricultural exports.
There are many shipping systems that employ these
various types of ocean shipping:
Barge on Board System
This system is designed primarily for bulk or high volume shippers.
It is ideal for shippers in cities on inland river ports to load
their cargo and have it delivered via barge to the ocean port.
Two such barge-on-board services are LASH and
SEABEE. The barges themselves and the ocean going vessel or "mothership"
make up the system. The barges are floated out to the mothership,
where either an integral gantry or elevator system will lift them
out of the water and place them in their proper stowage position.
Roll-On/Roll-Off Service
The Roll-on/Roll-off vessel (RO-RO) has practically all of its cargo
mounted on wheels making it ideal for inland shippers. The cargo,
contained in trailers, truck, automobiles, buses, etc. is driven
on board via an integral ramp in the stern of the ship. This method
of loading and unloading is very rapid and efficient. With today's
congestion at the world's ports, this system enables a rapid turnover
of freight.
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Products Frequently Shipped
by Air
Increasingly, air transport is becoming the mode
of choice, especially by manufacturers of valuable high technology
products, exporters of perishable foods and equipment manufacturers
replacing broken machinery or parts. The air cargo industry has
been spurred by innovations within the air cargo industry, which
have resulted in a more efficient loading and handling of goods.
With the exception of products with a relatively
long storage life and a relatively low value per pound or cubic
foot, any agricultural product with one or more of the following
characteristics can be profitably moved by air:
- Products with a relatively wide spread between local market
price and the market in a foreign market.
- Products with seasonal peaks, particularly if the peaks do not
coincide with production peaks from other supply sources for the
same market.
- Products in potential markets that do not have local or substantially
close suppliers.
Products with some degree of perishability, both in the sense
of physical deterioration and susceptibility to the risk of sudden
and wide market price fluctuations.
- Products for which the air cost does not comprise a substantial
percentage of the selling price and selling demand is so high
that the effect of the added air cost to the total selling price
does not have a substantial effect on demand.
- Products with a "fad," "snob" or "prestige"
appeal.
- Live animals because any animal due to the availability for
breeding and the impact which lengthy transit status have on physical
condition and behavior.
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Typical Commodities Transported
by Air
Asparagus
Avocados
Cherry Tomatoes
Citrus Products
Floral Stock (bulbs, tubers, cuttings etc)
Furs
Lettuce
Live Animals
Specialized and Processed Meats
Strawberries
Tree Fruits
Truck Farm Vegetable Products
Seafood
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