The world has become a global village due to the internet. It has shifted buying patterns to a macro world level. It has become easier for businesses to internationally engage in purchasing of bulk tote bags for their business beyond borders that allows companies to get better pricing and quality. We will explore key factors your business should consider before engaging in international bulk tote bag purchases that will make the importing process more convenient and transfer maximum cost saving to your business. Although this guide is specific to importing tote bags the suggestions may be applied to other products of a similar nature as well based on your further research.
What Bags are Imported the Most?
Tote Bags are imported in high volumes by wholesalers whereas they are also imported in smaller air shipments largely by retailers or small companies that may need this for their own use. In addition to tote bags wholesale muslin cotton pouches are also imported in bulk quantities.
An Import License is not Required by Businesses
There is a misunderstanding amongst first-time importers that their business needs to have an import license. You are able to import on your business name without a import license. In fact, it is also common to import on your personal name if the shipment is small below a certain weight threshold which may also lead to exemption of import duties.
When is a Clearance Agent Required?
A clearance agency may be required depending on the shipping terms. If you would like to import tote bags through an air shipment from the origin airport to the destination airport, then it is a requirement to avail the services of a clearance agent who charge an extra fee for providing the service. The cost of this service is not included in the seller’s cost as this is paid by the buyer once it arrives at their airport so it is best practice to budget and include this cost into the final cost for accurate budgeting.
The clearance agency would clear the goods and pass on the required documents to the airport for clearing the shipment. They are able to load the goods to a vehicle and ship it direct to your doorstep.
When is a Clearance Agent not Required?
If an air shipment is exported as a door to door shipment by companies such as DHL and UPS as a courier, then they take care of all the clearance by themselves and deliver the goods right to your doorstep. The charge of these services are already included in the freight charges quoted by your seller.
Weight of Tote Bags has direct correlation with freight costs
The lighter the bag higher quantity of tote bags per lb would mean lower freight cost per unit. The heavier the bag the lesser quantity of tote bags per lb would lead to a higher freight cost per unit.
Cotton bags usually are of lesser weight than canvas bags ranging from 2 oz for muslin cotton to 6 oz per square yard for normal cotton. Canvas bags further have GSM range that start from 8 oz per square yard to up to 16 oz per square yard. Therefore it is crucial to pay extra attention to the GSM of the tote bag, their size, as these have direct influence on the freight costs.
The type of bag being naturally has influence on freight cost. Tote bags normally come in larger sizes than muslin pouches – which mostly are made in small sizes. Wholesale Canvas zipper pouches are also mostly made in a smaller size than traditional tote bag because it is used as an amenity bag and due to smaller size often convert to a lower freight cost per unit than a traditional tote bag.
When is it Best to Import by Sea?
Shipping by sea is much more cost effective than air shipments only if the tote bag shipment volume is much more than air shipment. However, sea shipments from countries like India and Pakistan can take up to 2 months to arrives to the desired U.S. port adding the tote bag production time will only increase the time even more.
It is common for importers to order tote bag batches regularly by air before transitioning into the sea shipments. As by this time they have more outlook on the potential demand for the product. It is a key requirement to have a clearance agent for all sea shipment. Importers can get quotation from their local clearance agents in USA and then compare the freight costs to the air shipments. Only when they are convinced of the potential savings justify need for sea shipment they can proceed.
Sea shipments are of two types:
- LCL Shipments: One container is used for multiple shipments. It is mostly used for smaller shipments and cost is divided amongst all the shipments and importers
- FCL Shipments: A whole container is booked full of goods. This requires significant amount of quantity and weight so the quantity of the bulk tote bag order should justify booking a whole container.
Common shipping terms:
- FOB: This acronym represents free on board. If an exporter quotes on FOB terms this means exporter or seller’s liability is complete and includes costs upon placing goods on the ship at the seller’s port or commonly known as port of origin.
If a buyer or importer engages in FOB terms they will have to cover additional cost of hiring their clearance agent to complete shipment to their destination port and this amount should be included in the landed cost of the bags as they will have to pay it themselves.
- CIF: This acronym represents cost, insurance and freight. If a seller quotes on this basis then they will include costs of insurance and transporting up to the buyers port or the port of destination mentioned in the agreement. The exporter or seller’s liability in the case completes upon transported goods to the port of destination
When to Give Priority to Air Shipments Over Sea Shipments?
Air courier and air cargo shipping time is significantly less compared to sea shipping time. An express shipment by air can easily arrive from countries such as India and Pakistan within 7 business days. Sea shipments can easily take 2 months shipping time. For this reason air shipments tend to be more expensive. The larger the shipment the larger the cost savings would be in shipping by sea over air shipment.
It is common for individual retailers purchasing for their own company to give priority to air shipment where as for a wholesaler or distributor to prefer the sea shipping mode due to dealing with larger quantities.
Sampling is Crucial
It is recommended to order more than one sample in different GSM and sizes. This will allow potential importer of tote bags to estimate the freight costs accurately as they will have ready access of tote bag unit weight so they can budget the freight cost of different samples and then make the final decision based on lowest freight cost and best quality for their requirement.
Foreign Exchange Rate can have positive effect on your purchase
It is common for U.S to import tote bags from 3rd world countries which have availability of the best cotton such as India and Pakistan. Currency devaluation against USD in these 3rd world countries would mean a higher buying power of USD making U.S imports cheaper for the buyer.
Printing Customization on Tote Bags
Printing customization is much cheaper from importing countries. This is why it is common for international tote bag shipments include large customized printed tote bag orders.
Compare how much it would cost for your business to print same no. of colors of logo from USA and compare the same customization printing cost from importing country to get a better idea of the cost savings.
Concluding Remarks
International shipment for first time importers may seem like a complex task. However with proper considerations mentioned in this article you will be able to understand what factors to consider that will make your first time importing experience smoother by knowing what to expect and ensure all costs related to the import are budgeted carefully in advance.
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