Thursday, July 15, 2010

US Customs Broker and US Freight Forwarder

US Customs Broker and US Freight Forwarder
Part 2

After I reviewed Bill 1, I went down to my local community bank and filled out the paperwork to wire the funds to my new Service Provider so he would release my garments to me. I chalked it up as a lesson in experience. Rule 4. Always ask about the money.

I was surprised the following day with another invoice. This was for $145.56 and the service was described as Destination CFS charges “Warehouse In and Out Charge”. Give me a BREAK. And again there was the “wire money into my bank before we release your garments.”

I asked about this charge and my supplier explained that it was for using a warehouse in Greensboro, NC which is the closest port to Winston Salem – about 25 miles away. And, I stated that I would not wire the $145.56 because there is a 22.00 wire fee and I just paid to wire you yesterday. I could mail a check or deposit to their bank account. My new service provider was OK with a check. Look, $145.56 for a warehouse In and Out charge in Greensboro was absurd and I know because I’ve used warehouses in Greensboro and Norfolk Va. It looked obvious to me that my new service provider was tacking a stiff profit onto the local warehouse fee.

So, I wrote the check and added it to my original learning experience tab.

Imagine my Surprise when 2 weeks later I received MY 3rd Bill. This was for $125.00 and the description was for Drayage. This is the transportation cost to move the goods 25 miles from Greensboro to Winston Salem. I’m disputing this charge because from day one – the terms were delivered Winston Salem.

In the end, it’s actually cheaper to air ship by a courier service and deliver directly to my door verses this landed cost. It’s sad that businesses take advantage of small companies and even sadder that I passed up “due diligence” and assumed I’d be treated fairly.

There are also sites on line that sell a software that allows you to make entry without a broker. Maybe I’ll try it one day. Here’s a quote from a blog that lists 10 reasons to file your own – number 8 is what I’ve been writing in part 1 :

“#8 – Because you´re probably already doing most of the work

In many cases we´ve found that the majority of US importers are already providing the essential entry data (such as tariff classification, value and origin) to their appointed broker. If that´s the case, the remaining data elements on the CBP entry document are elementary in nature (such as vessel name and import date).

All for now!


The Underwear Maven

Thursday, July 8, 2010

US Customs Broker and US Freight Forwarder
Part 1
Recently I had an LCL (Less than Container Load) shipment from Asia. The manufacturer agreed in writing to pay for the transportation to my residential address and I would be responsible for the Customs fees, duty, bond, entry fees, etc. Sounds like a great deal, right? Because my supplier was paying for the transportation, I used his US counter part as my import broker and freight forwarder. I signed the Power of Attorney authorizing him to make the Customs entry for me under my business name and my importer ID. I should have asked for a written schedule of fees. I did not, so shame on me. I had been importing LCL from Asia so I had a ball park on what charges to expect. Again, I was surprised …..repeatedly…. with each new bill. Shame on me for assuming.

Let’s start by looking at the FIRST bill. Which, I was repeatedly told in writing that I must pay by wire transfer before my goods would be released. (Actually, payment up front for a new customer isn’t that usual but demanding a wire transfer - should be an option, and not a requirement. Hey, take PayPal or credit cards.)

Ok, Here’s the first INVOICE. I had 133 cartons which contained 3804 pieces.

Description Total (USD)

1. Destination CFS Charges 205.00


2. Customs Entry Fees 125.00

3. Documentation Fee 85.00
4. AMS Fee 30.00

5. Customs Exam 75.68

6. Customs Bond Fee 45.00

7. Customs Duties and Taxes 1021.10

TOTAL 1,586.78

Let’s decode this FIRST Bill
1. CFS stands for Container Freight Station (This particular station was in New York.)
2. STRIPPING – Unloading the cargo from a Container (also called devanning).
3. PSC- Port Service Charge
4. DAD – “Delivery Authorized Document is a form prepared by the Customs Broker and authorized by US Customs after presentation and approval of entry or entry summary and lodged with the carrier as evidence of customs release.”
5. Customs Entry Fee – Filling out paperwork or populating computer system with information I already provided.
6. Documention Fee – Filling out paperwork with information I already provided.
7. AMS Customs Automated Manifest System “Sea AMS allows participants to transmit manifest data electronically prior to vessel arrival. Customs can then determine in advance whether the merchandise merits examination or immediate release.” Again, This was the same information only it was the first time I filled out and sent all the details about my shipment.
8. Customs inspected my cases and charged me for the service. There is something wrong about first getting delayed because customs wants to check that you've done everything correctly and THEN having to pay them for this inconvenience. (I expected this for the first shipment from a new supplier.)
9. Customs bond fee. Basically I had to pay for insurance that US customs will get any money due from me.
10. Customs duty and taxes. I expected this since I already knew the duty rate for my products and the value for each of them.

What does the Underwear Maven think about this first Bill?


2. I’m not impressed with the line items. Get the right data into the right systems at the right time. I don’t care if it’s the early AMS data entry, or the Customs data entry, or the documentation fee for the data entry, or the DAD. It’s all data and it’s the same data and it’s all got to be done.

3. For an LCL shipment like this one, I expected to pay $200-$250 to the importer and freight forwarder to do the documentation and have the goods delivered to my driveway. I’m already out $445.00 and have I mentioned THIS IS JUST THE FIRST BILL.

4. Customs exam and Customs Bond Fee were expected and charges reasonable.

5. Duty was high, but I knew this from the start.

Oh my, my head aches so I’m taking a break. All for now!
The Underwear Maven