Using eCommerce to expand your retail business into China

International Cargo Express Pty Ltd in conjunction with the China Retail Group is inviting you to learn about

Using eCommerce to expand your retail business into China
Why Australian retailers/brand owners need to get ready for China and how to go about it.

China is both an opportunity and a threat to Australian retailers and brand owners. Many foreign retailers succeed but many more fail or are in limbo.

This seminar aims to inform Australian retailers of cost effective means by which to enter the China market and expand using eCommerce as an entry point.  Our expert panel from King & Wood Mallesons, China Retail Group and Asia Pacific Digital will brief participants on current trends in China for ecommerce, market entry, working with Chinese partners and digital strategies to succeed.

Topics:

• Framing the China opportunity for retailers
• Strategies for market entry and fulfilment
• Building your brand effectively through social media

Melbourne

Wednesday, 29 January 2014

8.00am – 10.30am

Next Digital, Level 8, 14 William Street, Melbourne VIC 3000

Sydney

Friday, 31 January 2014

8.00am – 10.30am

Sydney CBD – venue to be confirmed

Please RSVP by 17.01.2014 to rspahr@icecargo.com.au

The Tradex Scheme: How It Benefits Importers

Australian importers do not only import goods to satisfy the Australian retail market. Some consignments are imported with the express intention of exporting them again at some time in the future. It might seem strange, but it’s common practice especially when those goods are used by Australian manufacturers to complete their goods for export.

Logically, this import-export revolving door system would add greatly to the cost of goods, but the introduction of legislation has tried to reduce that impact as much as possible. The Tradex Scheme is the newest and the most effective to be introduced, and for importers represents the best cost-saving option available.

Why? Because it’s designed not only to negate the cost of import duty by allowing qualifying importers secure duty refunds, but actually streamlines the system completely. In fact, with Tradex, the financial pressures on importers are eased considerably.

How the Tradex Scheme Benefits Importers

The Tradex Scheme was originally introduced in 1999 to replace the Duty Drawback Scheme that had existed under the Customs Act 1901. The drawback system was a welcome development, with importers reclaiming both the duty and the Goods and Services Tax (GST) payable when importing goods. But the refund was only available once the imported goods were exported to their destination, which means a waiting period of several months before those costs are recouped.

The Tradex Scheme effectively cuts out that waiting period by qualifying the importer for an exemption from customs duty and GST. So, instead of paying those costs and reclaiming them later, the payment is skipped on the understanding the goods imported will be exported anyway.

The savings can be significant, not least in the crucial area of cash flow. For example, an importer might face a customs duty bill of 5% on a consignment and an additional 10% GST payment at the time of importing.

But with the Tradex Scheme, that payment not longer applies, so expenditure is lower. Perhaps even more importantly, that cost is not passed on along the supply chain, ensuring exporters benefit too.

Who Qualifies for the Tradex Scheme?

Of course, the scheme is not available to simply anyone. According to AusIndustry, the division of the new Department of Industry responsible for the implementation for the Tradex scheme, only those importing one of 3 categories of goods are eligible for the scheme.

• Imports that are intended to be exported again
• Imports that are to be incorporated in goods to be exported
• Imports that are to be used in manufacturing goods to be exported

Also, the exportation of these goods must take place within one year of their arrival in Australia, or a longer period subject to the approval of AusIndustry.

The range of goods that can fall into one or more of these categories is extensive, but ineligible goods include those which are:

• intended for sale in retail outlets at duty-free or other tax-free prices
• excise-equivalent goods, meaning if they were produced in Australia, they would be subject to excise duties anyway. These goods include most forms of alcohol, tobacco products and petroleum products.

Getting a Tradex Order

Like most matters relating to import and export paperwork, complexity is commonplace when it comes to securing a Tradex order. You can download the application pack directly from the AusIndustry and fill in the forms independently, but it’s best to let properly versed professionals take care of the paperwork – like your International Cargo Express team.

For many importers, the biggest challenge is in having the necessary paperwork in order to satisfy the scheme. Applying for the Tradex order must be done before importing any goods, but poorly organised applications can take as long as 30 days if AusIndustry decides to carry out a more detailed assessment.

The good news is that once your application is accepted there is no need to apply again ahead of any future consignments. So, getting it done right first time is well worth the time and effort.

Of course, this is dependent on the necessary paperwork being kept in proper order. This includes not only records of the imports nominated to be covered by the scheme, but also any manufacturing records where the imports were incorporate on finished products for export.

Contact Your ICE Team

At International Cargo Express, we’re always interested in helping our clients cut their costs by taking advantage of the full range of concessions and entitlements they are entitled to. To find out exactly how the Tradex Scheme can benefit you, simply call your nearest ICE team. Then why not let us take care of it, and guide you to lower costs and greater competitiveness.

Vertical Services The Future Of Freight Forwarding

The future of the freight forwarding industry rests on the ability to provide Vertical Services, according to experts speaking at an international conference at the Supply Chain Academy in the UK in September, which was attended by International Cargo Express Managing Director Ronald Spahr.

The Supply Chain Academy was established by ICE’s UK-based agency, Uniserve, to educate forwarders and customers alike on developments in the industry. Almost 20 freight forwarding agents from around the world, from Canada to Bangladesh, attended the conference.

The conference was told that European freight forwarders are increasingly dealing with companies looking for ways to offer greater benefits to the customer. As a result, the industry is now steering away from transactional relationships, which are highly competitive but offer no real benefits either to the forwarder or the customer.

Transactional Vs Vertical

A transactional relationship relates to a basic import or export deal, with revenue earned only through the transportation of cargo. Competition in that arena is so acute that the difference between deals is often only a few dollars.

Vertical services relate to the freight forwarder going beyond the scope of the traditional transactional relationship, incorporating aspects that effectively mean handling the entire supply chain system so as to offer solutions to any issues that may crop up.

The principal benefit to the customer is that costs are reduced because the whole range of tasks involved is kept in the hand of one service provider. A secondary advantage is that the service can run more efficiently since there is no need for complex collaboration or integration agreements between two or more interested parties – one company takes care of it all.

“Offering Vertical Services means offering more entrenched services that help to streamline the importation and exportation procedures,” explains ICE Managing Director Ronald Spahr. “This can be provided by checking on a customer’s entire supply chain system, identifying any hiccups that may exist and offering a solution that improves it.”

ICE Already Positioned For Change

According to Mr. Spahr, International Cargo Express is already well positioned to develop its own dedicated Vertical Service.

“ICE already works closely with customers, sharing our expertise and knowledge to ensure our customers enjoy the maximum benefits and savings. It means we can easily be subcontracted to do the functions that many customers traditionally arrange at a significant cost in-house. This is because most of those functions are replicated in our own existing services. We already know that this is where the big savings are for our customers.”

For more information on Vertical Services from International Cargo Express, simply contact the ICE Team. We’d be glad to address any queries you have.

Abbot Point Development Hit By BHP Withdrawal

Plans to expand Queensland’s Port of Abbot Point into Australia’s largest coal exporting facility have taken a severe hit with confirmation that BHP Billiton has withdrawn its interest in developing a new terminal at the port.

BHP had been identified as the preferred developer of Terminal 2 in the ambitious expansion, and had committed a sum of $5 billion to a project that included the construction of a railway line from Goonyella. The terminal, work on which was to begin in 2015, would have increased the coal export capacity of the port by an estimated 60 million tonnes per year.

Doubts over the project were raised as long ago as 2012, but it is only in November that the multinational mining corporation formally relinquished its claim as developer with North Queensland Bulk Ports (NQBP). In a statement, the company confirmed it would also “formally withdraw from related regulatory applications”.

The decision has caused NQBP to rethink the future of the development plan, but two companies remain committed – Adani and GVK Hancock, who hold the development rights to Terminal 0 and Terminal 3.

NQBP has stated that it will review the plan and assess how best to hold a “staged and timely incremental expansion” of Abbot Point as it searches for a new developer for Terminal 2.

Queensland’s port development plans have been set back by a number of events in recent months. A report from the public interest think-tank, The Centre for Policy Development, published this month, stated that port over-development along the Queensland coast would significantly weaken the state’s economy in the long run.

“Coal ports are operating at 65 per cent capacity, well below the industry average of 85 per cent,” the report claims, while its author, Laura Eadie, has stated that should Queensland develop Abbot Point, “it may all be for nothing. There is a risk of stranded assets, job losses and royalty shortfalls”.

Meanwhile in June, UNESCO warned that the Great Barrier Reef, which lies just a few miles directly east of Abbot Point and along the Queensland coast, could be added to their ‘In Danger’ list. It claims that by developing ports further, the risk of damage to the world-famous location will only increase.

At present, the Queensland government is re-examining its port and dredging policies, with Deputy Premier and State Development Minister Jeff Seeney stating the “Great Barrier Reef must not be put at risk”.

A new draft strategy is being considered, in which dredging for deep water port developments would be banned for 10 years and port authorities required to prepare master plans. The strategy is open for public comment until December 13.

ICE To Expand Freight Forwarding Services Into South America

International Cargo Express is to expand its full freight forwarding services into the South American market, greatly enhancing the options available to Australian importers and exporters.

Port of Montevideo in Uruguay

ICE has already established itself as a leading name in the freight forwarding industry from Australia to European and Asian markets and is enjoying a growing presence in the North American market. Launching new services into South America represents a major expansion for ICE as a global freight forwarder.

In a statement, ICE Managing Director Ronald Spahr said: “This is an exciting development for everyone at International Cargo Express. Now, we can offer the entire pallet of freight forwarding solutions in all South America countries, including customs clearance, delivery and distribution of cargo.”

Offering services that meet the highest levels of quality has always been a core part of ICE’s philosophy. Now, with new agents that have IT platforms that can communicate easily and securely with ICE’s own platform, the Australian freight forwarders are in a position to guarantee the same standards of excellence that customers enjoy when importing or exporting to other parts of the world.

ICE is now able to provide the complete forwarding and logistical solution for ocean and air freight services throughout South America. These include advice and document preparation for customs clearance, shipment tracking, contract management, exhibitions logistics services, warehousing and distribution services.

The news follows a series of meetings ICE Managing Director Ronald Spahr had in September with agents in Miami, USA, which is considered the gateway to Central and South America.

For further details about the exciting new freight forwarding opportunities available from International Cargo Express, simply contact the ICE Team. We’ll be glad to talk to you about how our new services to the Americas can cater to your needs.

New ICE Consolidation Service To Help Aussie Businesses Unlock China Markets

International Cargo Express has announced a major expansion of its Buyer Consolidation Service options designed to provide Australian e-businesses with a trouble-free gateway into China’s highly lucrative markets.

Through its extended Buyer Consolidation Service, a range of logistical solutions are now available that will allow online businesses to more easily access a market of more than 1.3 billion people – a market previously difficult to break into due to a combination of logistical issues and lack of shop-front presence .

While normal consolidation services offered by freight forwarders involve the cost-efficient transportation of goods for two or more customers in the same container, ICE is going a step further by offering value-added services that include:

• product distribution
• website portal development assistance
• revenue collection assistance
• pick ‘n pack B2B and B2C delivery

Announcing the development, International Cargo Express Managing Director Ronald Spahr stated that by adding more to its already highly successful consolidation service, ICE was playing their part in helping to generate further commercial opportunities for Australian e-businesses.

“We are very proud to be able to offer distribution services in China,” he says. “Our new Buyer Consolidation Service is designed for companies who wish to sell products in China, specifically over the internet through their e-commerce stores. And with the benefit of new arrangements we have made with our China-based contacts, ICE can now be of assistance to those looking to develop a presence in China.

“In addition to offering reliable, cost-efficient transportation and customs clearance services, we can assist in setting up web portals and even in organising the collection of revenue from sales. And through our distribution and delivery services, we are ideally placed to ensure products reach their destination, whether transporting on a business-to-business (B2B) or business-to-consumer (B2C) basis.”

Accessing A Growing Market

International Cargo Express has been operating in China for more than 20 years, and in that time has built an extensive network of contacts across the largest commercial market in the world. China is already Australia’s largest export market, with the total value in 2012 estimated to be in excess of A$73 million, more than three times the value in 2007.

And with the largest internet user population in the world, the potential that e-commerce between Australia and China promises is significant. In fact, the Department of Foreign Affairs and Trade has specifically identified that potential, stating: “It will be in both nations’ interests to collaborate to build trust and confidence in the online environment to facilitate innovation and economic growth”.

Estimates attributed to the Chinese Ministry of Commerce indicated that in 2013, China will be confirmed as the world’s largest online retail market, with 194 million online shoppers in 2011 spending some A$132 billion – a 53.7% rise year-on-year. Boston Consulting Group, meanwhile, projects e-commerce sales of some A$385 billion by 2015

Already specialising in the export/import of apparel, electronics and automotive products, recently agreed logistical arrangements now place ICE in an ideal position to offer assistance to Australian business owners looking to break into the lucrative China market.

Contact ICE Team

For further details about how International Cargo Express’s new Buyer Consolidation Service can help your business crack the China market, simply contact the ICE Team. We’re always glad to talk and answer whatever questions you might have.

Primary Versus Deferred Carriers: Your Transport Options

They say that time is money, but when it comes to transporting cargo this is not always true. In fact, the golden rule in the freight forwarding industry is the more time taken the less expensive transportation is – speed costs more. So, when urgency is not a factor, what are the choices available?

Actually, there are only two types of transport options when it comes to importing (or exporting) cargo anywhere. This helps to keep things relatively simple, but at International Cargo Express, we tell our clients to consider a few factors before deciding between them.

The choice of transport lies between using Primary Carriers and Deferred Carriers, which effectively translates to direct and non-direct delivery. The difference in time is obvious, but the difference in cost can also be significant.

Primary Carriers: What You Need To Know

Primary Carriers can deliver in the shortest period of time because they transport directly to where the importer wants the cargo delivered. For example, if you want to import 5,000 t-shirts from Vietnam for a specific rock concert just 3 days away, then a direct flight from Vietnam is essential (a direct sea voyage may be cutting time very short).

The cost, however, is much higher. This is partly because the amount of space on a flight is limited, and therefore a premium rate applies anyway, but it is mainly due to the convenience of having your cargo arrive so quickly. Remember, speed costs more.

Expedited freight services are favoured by certain importers – for example, organisations that need equipment transported for an exhibition and don’t want to leave that equipment onboard over a prolonged period of time and increase the risks involved while in transit.

Deferred Carriers: What You Need To Know

When time is not so important then Deferred Carriers are the best choice all-round. By deferred we mean that the cargo goes through more than one port, with the overall journey often taking more than a week. In fact, depending on the specific time-frame given, it can take anything up to 15 days before arriving at its destination.

This is generally because the cargo is trans-shipped, or is unloaded from one vessel and loaded onto another. For example, if the rock concert t-shirts leave Ho Chi Minh City on a Tuesday, it may not arrive in Melbourne until Wednesday the next week, after stops in Singapore and Jakarta.

Freight forwarders often have to be creative in their shipping decisions to secure the lowest combined rates, but the cost of transporting cargo through deferred carriers is always much less than the cost of transporting through a primary or direct carrier.

Part of the reason that importing via Deferred Carriers is such an economical option is that the number of lines that can carry your cargo is much higher than the number of direct flights for air freight. This means there is more competition amongst the companies to fill space – the opposite situation to when seeking a direct flight.

Contact Your ICE Team

As with all decisions, there are pros and cons to choosing primary or deferred carriers. Of course, the final decision is always our client’s, but at International Cargo Express we know that no decision can be made without knowing the facts. We have a range of international air and sea freight service options and have the know-how and experience to advise you accurately on the best transport option for your needs.

If you’re interested in finding out more about what options suit you best, just call your nearest ICE team. We’re confident you’ll see we are the freight forwarders for you!