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The 7-Step Ocean Freight Journey: Who Pays What?

1. Export Haulage (First Mile)

• What happens: Goods move from shipper¡¯s location to freight forwarder¡¯s consolidation warehouse

• Transport modes: Truck (most common), rail, or multimodal

• Who pays?

• Shipper (if pre-agreed) ¡ú Usually hires local trucker

• Consignee ¡ú Often uses forwarder¡¯s integrated transport

Pro Tip: For LCL shipments, ensure goods arrive at CFS (Container Freight Station) before cutoff.

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2. Export Customs Clearance

• Key requirement: Mandatory for all exports; handled by licensed broker

• Who handles?

• Freight forwarder (85% cases)

• Shipper¡¯s separate customs agent

• Critical timing: Must complete BEFORE goods leave origin country

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3. Origin Handling (CFS to Port)

• Process flow:

1. Cargo inspection & tallying

2. Consolidation with other LCL shipments

3. Container loading & port transfer

• Hidden costs: THC (Terminal Handling Charges), documentation fees

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4. Ocean Transport

• Carrier selection: Forwarder books space with shipping lines (e.g., Maersk, MSC)

• Cost components:

• Base ocean freight

• Surcharges (BAF, CAF, war risk)

• Who pays? Shipper or consignee per Incoterms®

  
  

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5. Import Customs Clearance

• Start time: Can initiate pre-arrival (e.g., 72h before docking)

• Key docs: Commercial invoice, packing list, Bill of Lading

• Duty trap: Average 5-15% of cargo value in most countries

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6. Destination Handling

• Activities:

• Port unloading ¡ú Container de-stuffing ¡ú Cargo prep for pickup

• Fees to expect:

• Port terminal charges

• DO (Delivery Order) fees

• CFS handling

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7. Import Haulage (Last Mile)

• Delivery options:

• Forwarder¡¯s trucking network

• Consignee¡¯s local carrier

• Golden rule: Shipper pays if DDP terms; consignee pays for DAP

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Cost Allocation Cheat Sheet

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Why This Matters Now:

• E-commerce surge: 60% of SMEs overpay by not understanding these steps

• Supply chain delays: 30% of holdups occur at clearance stages

• Cost savings: Proper Incoterms® selection can cut logistics spend by 15%

"Think of these 7 steps as dominoes¡ªone misstep topples your entire shipment timeline."
¡ª Logistics Manager, Kuehne+Nagel