Ocean Freight Rates Are on the Rise - Have You Renegotiated Your Rates Lately?

Ocean Freight Rates Are on the Rise - Have You Renegotiated Your Rates Lately?
By Ray McGuire

Ocean freight rates are on the rise. This is particularly true of ocean container shipments. In the last three months average ocean freight rates (container transport particularly) have climbed up to 55%. Have you renegotiated your rates lately? If not now is the time!

There are quite a few charges that may be a part of the total ocean / delivery transport costs on a typical import shipment. Some may be negotiable with the carrier / forwarder (given sufficient volume and frequency) and if you understand how ocean freight rates are calculated.

Let's take a look at what some ocean freight cost components might be:

BAF - Bunker Adjustment Factor Surcharge
ACC - Alameda Corridor Surcharge
PNC - Panama Canal Charge
SUZ - Suez Transit Surcharge
PSS - Peak Season Surcharge
AMS - Advance Manifest Surcharge
CHS - Chassis Usage Surcharge
CAF - Currency Adjustment Factor
DDC - Destination Delivery Charge
THC - Terminal Handling Charge
ARB - Origin Arbitraries
AGS - Aden Gulf Surcharge
WRS - War Risk Surcharge

Depending on your terms of sale (Incoterms) you may pay origin charges including:

ORC - Origin Receiving Charge
ODF - Origin Documentation Fee
THC - Terminal Handling Charge
DTHC - Destination Terminal Handling Charges

If your shipment is moving inland in the US, you may pay:

DDC - Destination Delivery Charges
IPI - Inland Point Intermodal or MLB - MiniLandBridge
IFC - Inland Fuel Surcharge

In addition, your container freight rate may depend on the actual commodity being shipped.

Of course there are the myriad of other costs not directly associated with the ocean freight or container rate, some of which include:

Importer security Filing (ISF or 10+2)
Customs Brokerage
Duty & Taxes
Stripping and / or Transloading of Container
Interim warehousing

and, and, and ...

Effectively negotiating ocean freight is not so simple and depends on knowing more detail. Will you have many "one-time" shipments, or more a repetitive business with each shipper? How much product are you shipping at one time, or if repetitive, each shipment? If repetitive, how often? The answers to these questions also determine if you want to use a freight forwarder or negotiate directly with the ocean carriers.

Door to door transit time is also a huge consideration. Will you ship to a major or "gateway" port and then truck to multiple distribution centers? Or will it all go to one DC? If you are planning on moving the containers intact to an inland DC, some difficulty may arise depending on the ocean carrier, and rail charges can be quite high. A forwarder (or the customs broker) can often manage the container delivery trucking to and from the port much better than a carrier (if the carrier even would). Otherwise you must arrange the trucking.

Choice of your customs brokers would possibly depend on your choice of routing. The delay at customs will depend on the accuracy and completeness of your vendors' documents, as well as the efficiency of the selected broker.

Plan for success! Poor planning can result in much headache and unnecessary expense. Great success will follow your good planning.

Article Source: http://EzineArticles.com/?expert=Ray_McGuire

Ocean Freight Rates Are on the Rise - Have You Renegotiated Your Rates Lately?

Commercial Loan Lenders and the Bottom of the Ocean

Commercial Loan Lenders and the Bottom of the Ocean

It is surprising to most observers to see how commercial borrowers needing help with small business loans are now viewing banks and bankers in a totally different light than they were just a few months ago.

Because of the sudden change in public perception, it is appropriate to consider revising a famous quote by Ronald Reagan about government solving problems to say "Banks are not the solution to our problem, they ARE the problem." For business owners, the current process for obtaining commercial mortgages and other commercial financing has become a quagmire of frustration and confusion.

After reviewing the maze of difficulties involved in the process for refinancing or acquiring new commercial loans, most business borrowers have concluded that the overall banking industry has become ineffective in providing even routine business finance services.

The banks which have already received hundreds of billions of dollars in federal bailout loan guarantees are currently the primary target of public scorn. Even bank employees seem to feel this way.

A person who was recently employed at one of these banks lost their job and did not hesitate to describe the relief because they no longer worked for this particular bank.

Bankers might have become the new lawyers in terms of public anger and ridicule. There was a joke making the rounds a few years ago about lawyers that has been modified to include a reference to bankers.

What do you call 10 lawyers on the bottom of the ocean? (A good start.) Substituting "bankers" for "lawyers" will readily provide a contemporary cultural reference about how far bankers have fallen in the public eye.

The many good bankers who have done absolutely nothing to deserve this ridicule have their work cut out for them to restore a tarnished image. If the good bankers can be more candid in their public criticism of the bad bankers, this is likely to be an effective strategy for improving their public image.

It seems increasingly clear that some banks and bankers have acted irresponsibly for many years. Other bankers are likely to be one of the best sources to correct and evaluate this misbehavior. Seeing the innocent bystanders in the banking community speak out publicly about those who caused the economy to implode will be both helpful and refreshing.

The practical need for commercial borrowers to find reliable sources for working capital financing, small business loans and commercial mortgage loans cannot be overlooked when evaluating the growing public criticism of banks. This will be more difficult than it might initially appear for several reasons.

First, many business borrowers could have been working with the same banker and bank for a long time. Some businesses might delay longer than they should in firing their bank because of loyalty and friendship issues.

Second, even after a commercial borrower decides that a change is necessary, it will not be an easy matter to find an effective source for business finance services. In most cases, it will be prudent for business owners to look beyond their local area in the search for better providers of commercial finance funding.

Third, adjusting to the fact that some of the most effective sources for working capital funding are not banks at all will take time for some business owners. For commercial financing services such as business cash advance programs, banks have played a smaller and smaller role even before the recent economic volatility.
Stephen Bush

Learn about avoiding commercial finance funding mistakes - Stephen Bush is a commercial loans expert => AEX Commercial Mortgages and Business Cash Advances
Commercial Loan Lenders and the Bottom of the Ocean