Explaining the customs clearance process

In order to explain the customs clearance process, we need to understand it first. So, what is customs clearance? In simple words, customs clearance is the act of passing goods through customs so they can enter or leave the country. Or it can be a document given by customs to a shipper to show that customs duty has been paid and the goods can be shipped. Documents involved in customs clearance can be import or export. Some of the import documents are:

  • Purchase Order from Buyer
  • Sales Invoice of the supplier
  • Bill of Entry
  • Bill of Lading
  • Air waybill

Some of the export documents are:

  • Purchase order from Buyer,
  • Sales Invoice
  • Packing List
  • Shipping bill
  • Bill of Lading
  • Certificate of Origin

If you are already intimidated by this paperwork maybe it is a good idea to hire a customs clearance company. They will have to deal with paperwork and law.

Document and a pen
Documents involved in customs clearance can be import or export

Every port around the world puts your cargo through a customs clearance process

You need to be prepared for the unpleasant truth that the rules, regulations, and laws are different from country to country. Sometimes the rules and regulations are different from port to port in the same country. This makes someone who specializes in the customs clearance process very important to a shipper. The logical next step for you is hiring someone who understands this process. And you won’t make a mistake if you look into the cargo companies in Jubail for example.

Because having the wrong person handle your customs brokerage can be very problematic. Shipping containers are warehoused as they go through customs clearance. Warehousing and storage fees can add up quickly. If there is a problem and your customs clearance does not happen smoothly, your shipping costs could go up by hundreds to thousands of dollars.

Every port around the world puts your cargo through a customs clearance process
Every port around the world puts your cargo through a customs clearance process

Your freight forwarder should be able to handle your customs clearance process

On top of previous problems, the delay in getting your shipping containers released to you could cost your business more money because the arrival of your shipment is delayed. If you don’t trust your freight forwarder you can always hire a separate customs broker. When choosing a freight forwarder, you want a company with the experience. They will handle your customs clearance process well and they will know what to do should any issues arise.

For these reasons, going with the cheapest freight forwarder isn’t the best idea. This can turn out to be much more expensive than hiring a freight forwarder with a higher quote.  Hiring those who have much more experience in the business can turn out to be cheaper and more satisfactory. So, try to balance your needs and your pocket.

Making a deal
Your freight forwarder should be able to handle your customs clearance process

Properly load your shipping container

Make sure your shipping container is properly loaded. Ultimately, you are responsible for the loading of your shipping containers. If your shipping containers are not properly loaded, you could cause red flags to go off at customs. Improper loading may lead to searches of your international shipments. You don’t need these delays and costs that are associated with this. Household and personal effects shippers should pay special attention to this, as such shippers have less experience than business importers and exporters.

Pay attention to 3 factors when loading your shipping container. These are weight distribution, space utilization, and cargo variation and compatibility. The weight of your cargo should be evenly spread over the entire area of the container’s floor. Use the space in the best possible manner. You can pretend that you are playing puzzles and your goal is to make a perfect match in your container.

Provide complete and accurate information to your customs broker/freight forwarder

The complications of shipping cargo from one country to another is why freight forwarders like Four Winds Saudi Arabia exist. We have the experience and knowledge of smoothly shipping cargo from one country to another. So you don’t have to worry about all the details, regulations, and hassles and can focus on your business. Still, there is a certain amount of paperwork you will need to provide to us.

Being accurate and thorough with your paperwork is important. This includes business information, inventories, and value of cargo. This information affects the duties and customs fees at the ports. It helps assess the risk of your cargo shipment, and more. The last thing you want is for customs to find your shipping manifest is inaccurate. They might think you’re trying to sneak something past them. What you want is a low-risk assessment of your cargo shipment at customs.

Exchange control licenses

Most countries have some form of foreign exchange control. These controls are about the amounts of foreign currency in their economies. This means that exporters may have to provide proof that they will be paid by the importer in a specific currency. Then they will be permitted to export valuable products. Importers may also require a license from the exporting country to convert payments into local currency to pay exporters.

Importers should check whether this is necessary. Because otherwise, delays might result while exporters wait for payment. Some countries require payment to be made by specific means, such as a letter of credit. Some governments also impose strict payment regulations on all foreign trade contracts in order to ensure payment. Don’t be afraid to ask a lot of questions. Depending on the answers you will choose the best company for you.

Understanding the customs clearance process

Understanding the customs clearance process can be stressful. There are a lot of things you are thinking about and you need to be prepared for that. But before you start negotiating with shipping companies you need to know what you want. You need to know precisely what it is you are transporting. Knowing the size of your cargo can significantly influence the price of your cargo. Check out companies you are interested in on the internet. Read reviews and contact them. Ask them everything you want to know. Negotiate with shipping companies and make sure to contact the right one. Because they will handle customs clearance and you want your stuff to go smoothly as they can.

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