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Case Study

We recently received an order involving payment by a third party (Chinese agent) for a shipment. During the operation of this order there were some minor problems due to communication issues and different habits of both parties. I use this case to break down the details of the hot water bag order operation.

 

It is very common for companies with a large number of products in their product line to use a China sourcing agent. However, this agent must be a properly registered company in China, not a natural person, and the payment must be transferred from the company account to the supplier's company account, never from the agent's personal account to the supplier's company account.

 

In this order, the country where this customer is located has a strict foreign exchange control system. I knew they had to apply for a license from the government first, and what I didn't know was that the license included the name of the exporter as well as the product name. I thought the exporter was our company at the time, but in fact the name of the exporter was the name of their Chinese agent company. The product name was also not the name of the product we normally use.

 

I made the P.I. and sent it to the importer after I communicated with them about the product details and price, and then I contacted their purchasing agent/Ningbo office, and that's where all the problems started

 

I used rubber hot water bag as the product name in the P.I, but in the final bill of lading I found that the product name was hot water bag, the Ningbo office checked my P.I and told me there was no problem, so in the subsequent commercial invoices and packing slips and customs declarations I used the product name as rubber hot water bag. This is the first hidden problem, the name of the product and the name of the bill of lading are not consistent.

I must reiterate that it is best to keep the same product name in the P.I commercial invoice and packing list as well as the customs declaration, as this is the safest operation.

Usually there are 6 product names of hot water bags are hot water bag, rubber hot water bag, natural rubber hot water bag, Hot water bottle, rubber hot water bottle, natural rubber hot water bottle. Importers and exporters communicate the product name in advance is a key point that can be easily ignored, but this can avoid a lot of trouble.

 

The second pitfall is the delivery date. The importer never discussed the delivery date with me, and after the Ningbo office and I had contacted them, they said they only had one month to complete the production, and they had to see the samples before paying the deposit. It took 1 day to receive the sample and another 3 days from the time the deposit was paid by the Ningbo office to the time our company received the deposit, at which point it had taken 4 days. We were able to complete the delivery within the time frame because we had the large scale of production and a complete supply chain, if not we would have delayed the delivery. Delivery dates must be communicated in advance or there will be a big problem.

 

The port of loading for our order is Ningbo port, and there is a slight difference between the customs declaration documents of Ningbo port and Shanghai port, the export in Shanghai port does not need P.I or sales contract, while the export sales contract in Ningbo port is a necessary document, which must be clear.

 

When confirming the details of the bill of lading with the freight forwarder, you must pay attention to the fact that some countries have their own customs codes, which are key points that cannot be ignored otherwise the customer cannot clear customs in their own country

 

Packaging information is used throughout the operation of the order, even at the quotation stage different hot water bag packaging can lead to differences in price. Hot water bags common outer packaging including opp bags, cpp bags, plastic hooks, gift boxes, paper sleeve, paper card head, PE bags, PVC bags, even the carton is divided into ordinary cartons, reinforced cartons, some customers require the first layer of cartons need to place a cardboard to prevent damage to the first layer of hot water bags when unpacking. Different boxing quantity has different boxing size, different size will lead to different volume, different volume corresponds to different price. All people should pay attention to the packaging information of hot water bags.

 

Only after full communication can ensure the smooth operation of the order

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Phone: 86 15189700574

Email: li@bofatetrading.com

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