Despite the best efforts of
groupage operators, the China
import service fee (CISF) is
unlikely to disappear any time
soon.
It involves incentives being
paid to the overseas exporter
or his appointed forwarder. In
general, this incentive is used to
offset the negative freight rates
being offered to secure cargo –
with the money being recouped
from destination cost.
It’s been a problem for a
number of years and operators
see little chance of a resolution.
It’s the way the market
operates,” an industry source
told FTW. “Virtually the whole
world is operating under these
prepaid terms.” FTW was told.
“Our way of dealing with
it is to encourage the freight
forwarders to convince the
importer to change the
shipping terms to FOB in order
to have more control over the
cargo.”
According to the source,
the whole subcontinent region
operates on the same system,
and there are even degrees
of the North West Continent
operating in the same manner.
The US – because of the FMC
control – doesn’t operate in the
same way, according to our
source.
“Managing customers’ cost
control is critical, but a lot of
importers don’t see it because
they’re getting such good CIF
terms,” said another source.
Then they pay the price once
the goods land here.
“Generally when the
consignee receives the
invoice and sees the inf lated
landside costs he realises
the need to change terms
from CIF to FOB. This is
where he can manage his
cost from start to finish
rather than allowing the
Chinese to dictate the endto-
end cost.”
Ship FOB - avoid China import service fee
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