air freight

The Impact of COVID-19 on the Air Freight Industry

Due to the COVID-19 pandemic, air freight has been one of the hardest hit industries in logistics.

Lockdown restrictions and travel bans have caused chaos internationally with many flights being grounded. On a normal day, air freight is responsible for the transit of trillions of dollars’ worth of shipments every year. Flying is one of the fastest methods of transport and is considered ideal for low volume, high-value items. With the industry currently at its knees, it has heavily disrupted global supply chains and production cycles for multiple countries. Other sectors of aviation including commercial and private air travel have also taken major setbacks with many airlines having to resort to mass redundancies of their employees.

 

The Pre-Pandemic Air Freight Industry

Before COVID-19, much of the worlds air cargo was carried via passenger aircraft. This was transported in the aircraft hold and made up 40% of annual global cargo. New generation, wide bodied aircraft are equipped with a generous belly hold capacity and are ideal to carry large quantities of cargo. A Boeing 777 passenger aircraft is able to carry as much as 20 tonnes and was frequently used to transport many shipments. Unfortunately, with only 20% of the world’s air traffic in operation at the moment, this has been significantly impacted.

Although freighter aircraft continue to operate by cargo operators and freight forwarders, many of these aircraft are hub focused and are not able to access the same extensive route network as commercial aircraft which is proving restrictive and taking away much of the convenience air freight has always promised.

 

Making Up the Shortfall

To ensure essential cargo continues to be transported, airlines have been utilising their main passenger cabins. The load sheet must be worked out precisely to ensure the weight and balance of the aircraft is not affected and is secured into passenger chairs with netting. It was widely publicised that emergency PPE for frontline healthcare workers was transported from China in this way.

At least 20 airlines have offered their aircraft for global cargo missions including British Airways, Delta and Cathay Pacific. The aircraft are chartered by freight forwarders and operated by the airline’s crew.

 

Low Fuel Prices Making up for Low Occupancy

Low fuel prices have eased the expense of low occupancy flights. This has been a saving grace to many airlines which has enabled them to continue flying to destinations they would otherwise have had to cancel. Aircraft manufacturers, Boeing and Airbus have also offered their freighter aircraft to transport critical supplies including 1.5 million facemasks.

Despite these creative solutions and work arounds, the industry is experiencing a major shortfall in the capacity it is able to transport and is majorly disrupting the transportation of essential goods such as medical supplies to virus epicentres.

Coordinating cargo supplies to demand is a time-consuming business that requires intense labour and negotiation from a lot of people. During the pandemic, this has been covered by governmental departments and national carriers and have usually been organised on an ad-hoc basis

 

Operational Obstacles

Before a shipment reaches its final destination, operators have to address certain challenges including airport curfews, border restrictions and flight time limitations. If the aircraft is permitted to land in a certain country, the crew can be subject to gruelling quarantine and testing regulations. This could see them spending up to two weeks in a hotel room upon arrival causing severe disruption to the operator. Without their crew they are without an aircraft prohibiting them from making other vital cargo journeys.

These issues are likely to cause pandemonium for the future of passenger air travel when lockdown restrictions lift. It is likely that these issues will still be in affect and will continue to prohibit many people getting to where they need to go.

 

Preventative Measures for the Industry

Aviation is an industry that relies on governments to work collectively and cohesively. When it comes to air freight, there needs to be more of a concerted effort made to remain consistent from one country to the other. The COVID-19 pandemic has taught us that new procedures are required to prepare ourselves for future crises. A framework must be developed for all countries to work from and ensure that the transportation of vital supplies is not severely disrupted regardless of the critical threat level of the world.

The development of this framework will involve analysis, risk assessments, training sessions and the re-writing of standard operating procedure.  For aviation in particular, more consideration needs to be given to air cargo and how we can keep operations going in the face of a crisis.  The air cargo industry has proved invaluable during the COVID-19 pandemic; however, more support needs to be given to be able to provide that invaluable service in the future.

Brexit-uk-ireland

Trade with the UK and Ireland takes a tumble as Brexit Bites Back

In a statement from the Irish government, it was reported that goods shipments in Ireland have halved in number with the UK and doubled with France in the first month of Brexit.

This shift in numbers highlights just one of the new issues that have arose from the new trade deal particularly with Britain’s so-called ‘land bridge.’ Hauliers now carrying EU shipments on British motorways are now facing lengthy delays due to the new bureaucracy imposed at the borders which is making the option of transporting via sea freight much more desirable despite the lengthy wait for the shipment to arrive.

 

Bureaucracy at the Border

According to the Irish Prime Minister, Micheál Martin, just 17,500 trucks (an average of 45 per ferry) arrived into Irish ports in January from Britain which is half of the figure that arrived in the previous year and just a fraction of the capacity of the Irish sea ferries which have the ability to carry at least 200 heavy goods vehicles.

Despite the exceptionally low flow of goods from Britain, hauliers were required to provide 760,000 import declarations, which averaged at around 43 per truck, to successfully gain entry into Ireland. The Prime Minister confirmed that these low volumes were as a result of, “Brexit stockpiling, COVID-19 restrictions, newly introduced checks and controls and the emergence of new direct services with additional capacity on European routes.”

Sea routes that bypass Britain have doubled in the last few weeks, particular the Ireland to France route which has seen triple the number of options available to hauliers. Drivers have been purchasing standby tickets in the hope they may find a last-minute space on these commonly full sailings.

 

COVID Testing Chaos

France is now requiring that drivers arriving on Irish ferries as well as from England should have a negative COVID test taken within the last 72 hours. In response to this, Ireland last week set up test centres enabling drivers to receive free antigen testing before boarding ferries. The two test centres were set up in Dublin and Rosslare and are already able to test up to 1500 drivers weekly.

 

Customs Clearance Catastrophe

As many as one in five lorries arriving into Ireland from Britain do not possess the required paperwork for customs, animal health, food safety or security. This is causing hours and even days of delays to vehicles before they are permitted to proceed into the country.

“The challenge the new checks due to Brexit create for traders is fully acknowledged,” the office said.

The same issue is arising for Irish drivers trying to access Europe via Britain. A protest was held at Dublin Port last week appealing to European Commission President, Ursula Von Leyen to appoint an EU trade trouble shooter at the major trade hub.

At present, Britain’s new customs regulations have been relaxed to ease companies into the processes. With issues already causing hassle, it is set to get worse when the new regulations come into full force in July.

“Exporters are being urged to prepare for these changes now,” said the Prime Minister’s office, noting that some Irish firms faced, “severe difficulty adapting to the new systems of control.”

The office recognised that companies were often let down by their clients or even customs agents but emphasised that, “It is absolutely necessary that everyone in the supply chain knows and understands their roles and responsibilities….. It is the responsibility of the importer or exporter or their agent to ensure the required information and channels of support are available to hauliers when goods are stopped.”

To mitigate delays, firms transporting goods from Ireland to Europe are now being advised to use direct sea links and cut out transportation through UK suppliers and distribution centres where possible. As a result of this, the number of crossings for direct EU routes had more than doubled to 62 weekly sailings including 36 with France.

These routes have gained in popularity for the sheer number of heavy goods vehicles it can carry (up to 10,000) with the added option of drivers being able to drop their shipments off on the ferry and have them picked up by another driver in Europe avoiding the need to complete the sea voyage or source a coronavirus test.

low tariffs after brexit

Brexit and the Logistics Industry: Infiniti Research Outlines Key Challenges

Well known market intelligence company, Infiniti Research have announced completion of an article on their website outlining what they expect the key challenges of Brexit will be on the logistics industry.

The deadline for the UK and the EU to negotiate a trade agreement is set to end on the 31st December.  With the deadline a matter of weeks away, no deal has been struck and it is looking likely that the UK will no longer have access to the single market and customs union. Due to the high amount of cross-border movement within the sector, this will undoubtedly impact the logistics industry in a significant way.  According to Infiniti, Brexit is likely to have severe consequences to even the big logistics companies. One significant example of how troublesome Brexit is set to be is through the importation of Britain’s petroleum. At present, over 25% of this commodity passes through the EU before arriving in Britain. With no access to the single market and customs union, a tariff will be applied on this product as it leaves the EU and enters the UK. The extra expense will have consequences on Britain and the EU as those extra costs trickle through the markets.

 

Brexit and the Top Challenges

Infiniti’s article outlines the following as the logistics sector’s top challenges as the UK leave the single market:

Reduced Trade

In 2019, 43% of the UK’s exports went to the EU which equated to £294 billion whilst 53% of the UK’s imports were from the EU. With the UK set to not have access to the single market, a rise in tariffs will discourage trade between the EU and these numbers will inevitably decrease. With EU trade, making up such a large percentage of the UK’s total imports and exports, this will undoubtedly make a huge dent in the country’s GDP.

Border Control

As free movement between the UK and the EU ends, tighter border controls are set to be put into place creating barriers for trade on either side. The UK government has warned of a 6-month disruption period with the worst of it being during the first 3 months. This will mostly be down to additional checks being introduced and the expectation that at the beginning drivers will not have the correct licences and shipments will not be accompanied with the correct paperwork. In an attempt to mitigate these delays as best they can, HMRC have announced there will be a period of leniency for the first 6 months where the new procedures will be simplified. The disruption to the border is already having a knock-on effect on the logistics industry. With businesses predicting delays in supply chains, they have taken to stock piling essential goods. For UK logistic companies, delays in the border will mean a decline in efficiency and potential problems with administration if the correct paperwork and customs fees are not paid.

Migration Control

Another potential problem that Infiniti has outlined will be stricter controls on migration with particular emphasis on EU workers. With freedom of movement coming to an end, citizens of EU states will no longer have the right to work in the UK and will need to apply for the necessary work visas.  This will translate to less EU workers working for UK companies. Road haulage is set to be majorly impacted by this, as the sector relies on drivers belonging to other EU countries. Additionally, drivers with UK licences will be required to apply for an international driving permit to transport goods within EU states. These permits will need to be issued for every journey that is made and they are capped in amount. This alone will significantly import the number of times UK drivers will be able to transport goods. Drivers with EU licences will be able to continue to use their licences in the UK but only for a temporary period.

Increase in Operating Costs

With no trade agreement in place with the EU, the cost to import fuel into the UK will rise which will impact on the price consumers pay at petrol stations. This along with added tariffs and duty payments that will need to be handled, managing shipments is going to become considerably more expensive than it was whilst the UK was in the single market.

 

Prepare for the Worst

Due to lack of direction from the government and the ongoing issue of the COVID-19 pandemic, logistics companies have been slow to prepare for the looming deadline of 31st December.  Businesses are being urged by experts to not, “sit on their hands and hope for the best,” and to instead do the research themselves to ensure that they know what is expected of them. Holding out for a trade deal at this late stage is wishful thinking and will be detrimental to businesses going forward. The UK government are urging companies and their affiliates to start preparing for the new legislation, understand what is required of them and to ensure that their associates are updated.

warehouse

Post Pandemic Warehouse Automation Market poised for Long Term Gains

An updated report by international market research provider, Interact Analysis, suggests that the warehouse automation market is set to make long term gains into 2023. 

Despite many industrial sectors suffering major losses as a result of the pandemic, COVID-19 has driven more people to turn to online shopping giving the sector a boost which is set to last well after the end of the pandemic.  This is causing warehouse managers to increasingly resort to automation solutions to provide a more efficient, productive and socially distanced working environment on the shop floor.

 

A Closer Look at the Numbers

Due to COVID-19, revenue for 2020 will continue to depress as completion dates for projects are pushed back to next year; however, the sudden surge in online shopping has caused a significant increase in order intake.  The second quarter order intake for Dematic has doubled compared to the same quarter in 2019, with the company planning to hire 1000 new staff by the end of the year.  In addition to this, the market size of the automation sector is set to be 6% larger in 2023 than pre-pandemic forecasts.  Although a lot of sectors such as manufacturing and apparel are predicted to see a drop in their market share – a combined decrease of $600m – the general merchandise and groceries are expected to make up for this fall, driving a significant overall net increase in the warehouse automation market.  Data from the report puts that increase at a combined market value of $3.5bn higher than pre-pandemic forecasts.  As a result of this, supermarket chains are now investing in their own warehouse automation.  With contracts to manufacture 38 automated warehouses by the end of 2025, Ocado are set to become one of the leading warehouse automation providers.

 

Software Revenues Under Threat

Another important finding from the report is that warehouse automation software revenue seems to be under threat.  An explanation for this is the growing trend among online retailers to bring warehouse execution and management software in-house.  Companies like Amazon, Alibaba and JD.com have been leading the way in this trend and other retailers are starting to follow suit.  As a result of this, we could see the market price of automation software commoditised forcing multiple systems integrators to tender bids for solution designs.  Research is suggesting that more innovation is required to suit specific sectors which off the shelf software is not providing.

Interact Analysis’ lead analyst for warehouse automation, Rueben Scriven says:

“The warehouse automation world is on the move. COVID-19 has devastated high streets and shopping malls, but there are already signs that eCommerce retailers are preparing to step in, with grocery retailers taking advantage of disused sites to augment micro fulfilment centres onto existing stores, bringing the fulfilment process closer to the customer, and attracting customers and jobs back in to the high street.  When it comes to the issue of automation software development moving in-house, we found that only the grocery sector will likely continue to heavily rely on existing integrator software solutions.  The way forward for warehouse automation vendors supplying online retailers is to increase their ability to tailor their software offering to individual customers.”

 

Relaxed Brexit Border Infrastructure Welcome but Not Enough Warns British Ports Association

On 24 September a new development order was applied, in named areas of England, relating to the requirement to check and process vehicles on entry into the United Kingdom as well as facilities for drivers and border staff. The order gives specific government border departments such as HM Revenue and Customs (HMRC) and the Department for Transport (DfT) the ability to apply to the Secretary of State to add infrastructure to its ports which will prove beneficial once the UK break away from the Single Market and Customs Union.

Approval by the British Ports Association

This order has been welcomed by the logistics industry, including the British Ports Association (BPA); however, they warn that there is still more to be done before the transition deadline. Richard Ballantyne, chief executive of the BPA said, “The legislation introduced to bypass the planning processes for border infrastructure in England is certainly a welcome move; however, there is still a lot be done to get ready for 2021. At various stages next year, new customs and border control processes will be introduced on European trade and our ports are working with the government to look at what needs to be done.”
He added that he hopes for a swift roll out of the government’s infrastructure plans, in-order that the UK’s gateway to Europe be ready.

The preparations have begun to create a physical and digital infrastructure to facilitate customs and other border procedures during transit between the UK, Europe and Northern Ireland. This could include new inspections facilities and computer systems to manage border controls that have emerged, following Britain’s exit from the Single Market and Customs Union.

Ballantyne said, “the sensible and measured implementation of the new border requirements could be essential for all parts of the freight and logistics industry.”

This order comes after a concerted effort by the Road Haulage Association and key figures from the logistics industry urged the government for a meeting over Brexit amid concerns over the slow progress that was being made.

The BPA represents 86% of port traffic in the UK, which includes major gateways such as Birkenhead, Dover, New Haven, Pembroke and Tyne. These facilities support the transport of thousands of trucks and trailers on a daily basis between Europe and the UK. This part of the industry could have the biggest impact on the new processes that are included in the new order.

Drawbacks to the New Order Identified

Following on from this, planning law expert of Pinsent Masons commented that the powers granted by the new regulations were limited to smaller developments which would not require environmental impact assessment (EIA). He explained that the development would not be able to approve new motorways or express roads over one hectare nor motorway services over 0.5 hectares unless it is proved that they will not have an untoward impact on the environment. He surmised that, “realistically…. The new order will apply to more modest changes in and around the ports.”

“Proposals must be put forward by a relevant border department – for example, HMRC – with the site owner, such as the harbour authority, only engaged on the application. Presumably, in practice, it is likely that the border department will have discussed things at length with port operators, as it is difficult to see how the border department will be best placed to lead on the necessary infrastructure to process port traffic efficiently through the port and surrounding areas.”

A Beginner’s Guide to Importing

As the eCommerce market grows, buying and selling goods online is fast becoming the norm for consumers. With this increase in popularity, businesses are more committed than ever to keeping their costs to a minimum. A top way to stay cost effective is to import goods from China, India or Taiwan. Importing your goods from as far as Asia can be a daunting prospect to a first timer. If you are a business looking to import from Asia for the first time, remember these 8 easy steps for a smooth process:

1. Follow your Market
2. Find your Product
3. Understand your Shipping Terms
4. Get your Quote
5. Track your Shipment
6. Prepare for Customs
7. Pay your Invoice
8. Plan your Delivery

Let’s take a closer look!

1. Follow your Market

When purchasing goods from abroad it is important to research the market you are looking to buy in. Just like purchasing things at home, it is not wise to invest in something you do not know anything about.

You will need to consider the following:

• Is your product in high demand? If so, you will need to ensure that you order enough to last you until you are able to purchase more. Keep in mind that it can take up to 6 weeks for shipments to arrive.
• Are you buying the right quantity? Shipping costs per unit are low when buying bulk but importing too much at once can be costly. Ensure you are being as cost effective as you can when considering quantity.
• Will you ship your goods via sea or air? Fast moving markets could benefit with the convenience and speed of delivery that air freight offers.

2. Find you Product

When sourcing a product, make sure that you know where it’s coming from. Some of the most common ways of sourcing products are through:

• Alibaba and Made in China. These companies are extremely popular with companies.
• Sourcing and inspection agencies. As a first-time importer, you may find it beneficial to use these.
• Visiting factories and trade fairs. This can be a great option if you are unsure of a particular company and want to see how they operate.

3. Understanding your Shipping Terms

It is important companies know what they’re paying for, what transport costs they are responsible for and when you have to pay. Top tips include:

• Try to negotiate importing your shipment on Free on Board (FOB) terms. This generally works out cheaper for the buyer.
• Try to avoid CIF/CFR shipping terms.
• Ensure you know exactly when and how your supplier wants to be paid for the shipment. This could include pay upfront in full or part payments at various points of the journey.
• Research the price of importing your product so that you know whether you are getting a good deal.

4. Get your Quote

Contact a Supreme Freight for a quote and ensure you familiarise yourself with the following costs:

• Duty and VAT. A lot of shipping companies are happy to advise on the duty and VAT costs.
• Insurance. Supreme Freight will quote you to insure your shipment whilst it is in transit. It may not seem essential at the time but is it worth the risk?

5. Track your Shipment

When we say track, we don’t just mean checking the location of your goods. We mean staying on top of your shipment. Before you start the process with a shipping company, ensure you know how long your shipment is going to take to get to you. Production and transit times are good things to know. If your product is going to take 6 weeks to make and then another 6 weeks to ship to you, you’re going to want to know in advance!

Be sure to ask your shipping company for:

• Estimated departure and arrival date into the UK
• Name of the vessel to enable you to track it yourself
• Estimated delivery date for your address

6. Prepare for Customs

When your goods are in transit, you will need to prepare the following for your shipment to clear customs:

• Commercial Invoice from your supplier to present to customs when your shipment arrives.
• A Bill of Lading – This proves that you are the legal owner of the shipment.
• An EORI number – This will vary depending on whether you are a VAT registered business. Most shipping companies will arrange this for you, the most you will need to do in this case is to send the form to HMRC.
• Commodity codes so that HMRC are aware of what the shipment is.

7. Pay your Invoice

Once your goods have arrived into the UK, we would advise settling your invoice as soon as possible as your shipping company would have paid a significant amount in Duty and VAT on your behalf. You will generally receive your invoice between customs receiving your goods and delivery and it is generally paid via bank transfer.

8. Plan your Delivery

When planning for your delivery, consider the following:

• Delivery address – Does the delivery address of your shipment have sufficient storage solutions for your goods? If not, you may need to consider renting a storage space.
• Size and weight of shipment – If your cargo is bulky or heavy you may need a tail-lift delivery or extra man power to help with unloading.
• Time of delivery – Plan ahead and ensure that your goods are delivered at a time when your storage facility is open.
• If you are delivering directly to an Amazon warehouse, you may need your supplier to label the cartons to ensure it can be identified.

sea freight china

A Guide to Sea Freight Shipping from China

Sea freight is the largest method of shipping for international import and export business. Competitive prices and multiple options make sea freight the first choice for global trade. When it comes to shipping from China, businesses need experienced freight forwarders like our team at Supreme Freight who are familiar with transporting for companies of differing sizes as well as to a wealth of countries. As a China freight agent, we hope that you are able to gain something from the knowledge and experience shared in this article.

Trade Terms

Get accustomed to all the codes and terminology with our simple breakdown:

Incoterms – A term given to one of the common terms of trade. When applied to buying goods from China, there are four incoterms. Each of the incoterms are assigned a code relating to how far the suppliers transport the shipment to. The codes of these incoterms are as follows:

EXW – Transport as far as the factory/manufacturer

FOB – Transport as far as a nearby port in China

CIF – Transport to a nearby port in your country

DAP/DDU – Transfer to your place of business

The codes can be split into two further categories:

  • EXW/FOB Category – The buyer can utilise your own freight agent and liaise with them directly regarding payment.
  • The Other Category – The buyer uses their own freight company and your company subsidises that.

When looking for a freight forwarder, it is important that you understand these terms and codes to enable them to know your requirements when shipping your goods to China.

Container Types

It is important to know the following commonly used container types:

  • 20’GP – Allows for 20ft of storage. 20’GP is designed to carry more weight than voluminous cargo. E.g. Minerals, metal and machinery
  • 40’GP – Allows for 40ft of storage. 40’GP is designed to carry more voluminous cargo than heavy cargo. E.g. Furniture, tyres, and toys
  • 40’HC – Allows for 40ft of storage for shipments of a great height.

Although the volume of the 40’ containers are double the volume of the 20’, they are still bound to the same weight restriction that China applies to its exports which is no more than 27-28 tons. The ocean rates for a 40’ container shipped from China are less than two 20’ containers and it is no extra cost from a 40’ container for a 40’HC.

Freight forwarders are also knowledgeable of these commonly used container types. Knowing this information upfront will allow the freight forwarder to help and advise you with the right service.

Shipment Type

Shipment types come in the following two categories:

  • Full Container Load (FCL) – In which a company fills a whole container with their own goods. Containers can be from 20 – 45 feet long.
  • Less than Container Load (LCL) – Where different companies share the same container and load their shipments into it. This would then get split once it reaches port.

In order to ascertain what shipment type is best for your business you need to consider the packaging that your shipment requires whilst being transported, if you select an LCL, would it be better for your shipment to use a courier or decide whether it is possible to use an FCL.

Major Ports

Each port has a different charge for FCL and LCL containers. The breakdown of the Chinese ports are as follows:

  • Shanghai – This major city enjoys the most economically developed of everything. From where it is located, it serves interior provinces via river ports along the waterway that extends from it.
  • Shenzen – This port is accessible to Hong Kong and the Pearl River Delta making it another key port for the South of China.
  • Ningbo-Zhousan – This port serves both Ningbo, which has good connections with Central and Western China and Zhejiang, a wealthy region with a manufacturing industry.
  • Hong Kong – Fastly expanding into the ‘international shipping service hub of the Far East,’ Hong Kong provides 340 container liner services per week, connecting to around 470 destinations worldwide.
  • Guangzhou – Historically, a key centre of trade in China, the port is striving to be the international shipment hub for the Maritime Silk Road component. It is a port that provides options for importers, exporters, third party logistic companies and ocean carriers with its reduced port and berthing fees.
  • Qingdao – The most important port of Northern China. It is located next to the Bohai Bay region of which it serves.
  • Tianjin – This port is second only to Qingdao port in capacity in Northern China. The port’s container handling business are developing additional domestic and international routes.
  • Xiamen – The port is located at the mouth of the Jiulongjiang River and has over 68 shipping routes to over 50 countries including Kaohsiung in Taiwan.
  • Dalian – This port is located at the most northern ice-free port of China and is the largest port in North East China serving seaports in East Asia, North Asia, and the Pacific Rim.

Researching into the port that best serves where your shipment will be transported to, will enable your freight forwarder to connect you with our most suitable partners.

For a consultation and advice on your shipment, get in touch with us and we will do our best to help.

 

Air-Freight-vs-Sea-Freight

Air Freight vs Sea Freight

When shipping goods internationally, there are many factors to consider. One of the biggest, is what mode of transport you are going to use to get your goods there.

No matter the reason of what and why you are shipping, deciding between sea and air freight is extremely important. Contacting an experienced freight company like the team at Supreme Freight can help you make this choice using our industry experience to get you the most suitable freight solution. Both methods have advantages and disadvantages to them, some of these may apply your needs, so before making a decision, doing your research is strongly advised. Today, we are looking into the differences and the benefits between sea and air freight to help you make that all-important choice!

Considering the Factors

When trying to make the important decision between shipping your items by air or sea freight is dependent on the following four variables:

  • Cost – No matter your budget or your circumstances, cost will have an influence over your decision making. It is typically thought that sea freight being the cheaper of the two and while that may be the case in a lot of situations, it’s not for all. Ensure that you shop around and get quotes for both modes of transport with different companies.
  • Speed – If you have a time restriction on when you need your goods to get to their final destination then we would strongly advise that you consider air freight. Sea shipments can take as long as a month, whilst air freight can be there in a day or two. If you are shipping for business, the time and convenience of your goods getting there in such a quick timeframe, may more than make up for the cost of air freight. If you don’t require a quick timeframe it could make a lot more sense to send it via sea freight.
  • Reliability – When we’re deciding on the right company for their services, we want them to be reliable and it is no different here. When it comes to air and sea freight, ocean sea freight companies have had a much longer history and time to perfect their processes; however, airlines are very keen to stay on top of schedules with much fewer delays and cancellations, it comes out at the most reliable.
  • Environment – With the ever-increasing issue of climate change pressing on the world, there’s no better time than now to make more environmentally friendly choices to help preserve our planet. As social awareness is growing, companies are trying to do their bit to provide more eco-friendly business solutions. When looking at both, it appears sea freight would surely win hands down as it releases far less CO2 emissions; however, with oil and chemical spills and sea freight impacting on water ecosystems that might not be so clear cut after all.

What are the Advantages of Sea Freight and Air Freight?

Still not completely sure with which to go for? Read up on the benefits of each:

Sea Freight

  • Cost Effective – For businesses looking to import large quantities of goods. Sea freight has been known to be 4 – 6 times cheaper than air freight. Additionally, duty and VAT are calculated at a cheaper rate than air freight keeping the costs down in other ways.
  • Flexibility – There are a lot of options to sea freight as mentioned above. This flexibility could suit a number of businesses. Sharing containers spreads the cost between companies.
  • Less Restrictions – Sea freight importing does not have as many restrictions of what companies can import, in terms of size and amount as other methods do. Bigger items such as furniture or vehicles isn’t going to be so much of a problem by sea as it would by air.
  • Accessibility – Sea freight is pretty much accessible from anywhere in the world. Sea freight importing is much better for the environment than other methods.

Read more about our Sea Freight services.

Air Freight

  • Efficiency – Air freight is quick, particularly if you use a direct service. You can expect goods to be at its intended destination within days of sending it whilst sea freight can take several weeks.
  • Good Value on Smaller Deliveries – Air freight is charged based on weight as opposed to volume which makes it more cost effective to send smaller deliveries via air freight than by sea.
  • More Options – Shipping companies are able to offer more options to the importer with air freight, including consols and direct routes.
  • Less Potential to Damage Shipment – Providing the goods are correctly packaged, air freight is usually a better way of shipping fragile items as damage is less likely compared to sea freight.
  • More Traceable – As flights are tracked, shipments are more easily traceable which can give businesses more peace of mind.

Read more about our Air Freight services. 

Contact us today to see which solution is the best fit for your shipment.

HMRC

UK Tariff Changes announced from 1st January 2021

From 1 January 2021, the UK will apply a UK-specific tariff to imported goods.

This UK Global Tariff (UKGT) will replace the EU’s Common External Tariff, which applies until 31 December 2020.

The new tariff is tailored to the needs of the UK economy. It will support the economy by making it easier and cheaper for businesses to import goods from overseas. It is a simpler, easier to use and lower tariff regime than the EU’s Common External Tariff (EU CET) and will be in pounds (£), not euros.

The UKGT also expands tariff free trade by eliminating tariffs on a wide range of products. The UKGT ensures that 60% of trade will come into the UK tariff free on WTO terms or through existing preferential access from January 2021, and successful FTA negotiations will increase this.

This will lower costs for businesses, ensuring they can compete on fair terms with the rest of the world, as well as keeping prices down and increasing choice for consumers.

The Government is maintaining tariffs on a number of products backing UK industries such as agriculture, automotive and fishing. This will help to support businesses in every region and nation of the UK to thrive. Some tariffs are also being maintained to support imports from the world’s poorest countries that benefit from preferential access to the UK market.

The UKGT was designed following widespread engagement with businesses across the UK. As it will come into force on 1 January 2021, it’s important that businesses can familiarise themselves with the new tariff regime ahead of this date.

The Government are backing UK industry by:

Maintaining tariffs on agricultural products such as lamb, beef, and poultry.
Maintaining a 10% tariff on cars.
Maintaining tariffs for the vast majority of ceramic products.
Removing tariffs on £30 billion worth of imports entering UK supply chains. 0% tariffs on products used in UK production, including copper alloy tubes (down from 5.2%) and screws and bolts (down from 3.7%).

UK consumers will also benefit from more choice and lower costs on numerous goods thanks to zero tariffs. These include, for example:

Dishwashers (down from 2.7%).
Freezers (down from 2.5%).
Sanitary products and tampons (down from 6.3%).
Paints (down from 6.5%) and screwdrivers (down from 2.7%).
Mirrors (down from 4%).
Scissors and garden shears (down from 4.7%).
Padlocks (down from 2.7%).
Cooking products such as baking powder (down from 6.1%), yeast (down from 12%), bay leaves (down from 7%), ground thyme (down from 8.5%) and cocoa powder (down from 8%).
Christmas trees (down from 2.5%).

The Government will promote a sustainable economy by cutting tariffs on over 100 products to back renewable energy, energy efficiency, carbon capture, and the circular economy. The following are all dropping to zero tariffs:

Thermostats (down from 2.1%).
Vacuum flasks (down from 6.7%).
LED lamps (down from 3.7%).
Bike inner tubes (down from 4%).

Almost all pharmaceuticals and most medical devices (including ventilators) are tariff free in the UKGT. However, some products used to fight COVID-19 maintain a tariff. To ensure those working on the frontline can access vital equipment easily, the UK has introduced a temporary zero tariff rate on these products. This relief waives the tariff and VAT for personal protective equipment (PPE), medical devices, disinfectant and medical supplies from non-EU countries.

The UKGT will apply to all goods imported into the UK unless:

An exception applies, such as a relief or tariff suspension
The goods come from countries that are part of the Generalised Scheme of Preferences
The country you’re importing from has a trade agreement with the UK

It only shows the tariffs that will be applied to goods at the border when they’re imported into the UK.

It does not cover:

Other import duties, such as VAT
The precise details of trade remedies measures
Other restrictions on imports, such as anti-dumping, countervailing or safeguards

Goods covered by a tariff-rate quota:

Some products are covered by a tariff-rate quota. This allows a limited amount of a product to be imported at a zero or lower tariff rate.

The limit may be expressed in units of:

weight
volume
quantity
value

If this limit is exceeded, a higher tariff rate applies.

If there is a tariff-rate quota on your product, you can apply to import a limited amount at a reduced rate of customs duty.

Some tariff-rate quotas are only applicable to products imported from a specified country.

Please follow the below link to check the tariffs that will apply to goods you import from 1 January 2021.

https://www.gov.uk/check-tariffs-1-january-2021

If you need any help or support please contact us.

NHS charter

PPE Equipment to arrive today for the NHS

We are very proud to announce that we have arranged a full charter of vital PPE equipment directly for the NHS to arrive today. Flight number F79540 landing into London Heathrow at 13.30 from China.

Our thanks as ever go out to the NHS and all those working to keep us safe.