Shipping and logistics
Shipping inland.
If your country has no coastline, the goods enter somewhere else and travel inland. The two decisions that follow are which port to use and whether to clear customs there or move under transit and clear at home.
Choosing the port.
The cheapest ocean rate is frequently not the cheapest delivery. Compare total landed cost including the inland leg, which on a long rail or road run can exceed the ocean freight.
Rail availability matters more than distance. A port with a regular rail service to your region can beat a nearer one without it.
Service frequency matters as much as price. A cheaper port with one sailing a fortnight costs you inventory.
Habit is expensive here. Buyers who always use one gateway are usually leaving money on the table, and it is worth repricing annually.
Clear at the port or inland.
Clearing at the port of entry means duty and tax fall due there, and the goods move as domestic cargo afterwards.
Moving under a transit procedure defers clearance to an inland office, which can suit your VAT position and your broker relationships.
Which is better depends on where your importer of record sits and on the cash flow effect of when duty falls due. It is a question for your broker rather than for the exporter.
What changes for you as a buyer.
The Incoterm has to name a place that means something. Delivered terms to an inland city are very different from a port term, and the price gap is the inland leg.
Border checks for food, plant and animal products happen at the point of entry into the customs territory, which is the coastal port rather than your country.
Free time on the container is consumed by the inland leg, so demurrage and detention exposure is higher than for a coastal buyer.
The container itself.
Ask whether the container travels inland or whether the goods are transloaded at the port. Transloading costs money and handling and it frees the container.
If the box goes inland, detention runs until it is returned, and returning it from an inland city takes days.
For irregular or small volumes, transloading into a truck at the port is frequently cheaper than paying detention on a box that has to travel back.
Questions buyers ask.
Which port should I use?
Price at least three on total landed cost including the inland leg and the free time, rather than on the ocean rate. The gap between gateways is usually larger than the gap between carriers.
Should I clear at the coast or inland?
It depends on your VAT position and on where your customs representative operates. Both are normal, and the choice has a real cash flow effect.
Why is detention worse for inland buyers?
Because the container has to travel to you and back before it is returned, and free time does not stretch to cover that. Transloading at the port is often the cheaper answer.
Read next.
Incoterms for Indonesian shipments
Almost every quotation out of Indonesia says FOB. For a container that is the wrong rule, and the body that writes the rules says so.
Demurrage and detention
Two different charges buyers confuse, both on a clock that does not care whose fault the delay was.
Working out a landed cost
Everything between the factory price and the shelf. The twelve lines it contains, and the four that buyers forget.
Door to door or port to port
Who arranges what, where responsibility sits, and why the simpler-sounding option is not always cheaper.
Sourcing from Indonesia?
Tell us the product, the quantity and the destination. We come back with what it involves before anyone talks about money.