Costs
Two quotes for the same container can differ by a third and both be honest. The difference is which lines are inside the number and which arrive later as a separate invoice.
Contents
An export quote has three blocks, and a good one keeps them apart. Ocean freight is what the carrier charges to move the box. Origin charges are what happens in China before it moves. Destination charges are what happens at the other end, and they are usually billed to whoever is named as consignee.
Most quotes you receive at a trade fair collapse the first two into one figure and leave the third out entirely. That is not dishonest, it is conventional, and it is the reason two numbers for the same shipment can look wildly different.
Ask for the blocks separately. A quote that separates them can be compared with another quote. A single all-in figure can only be compared with the invoice that arrives afterwards.
The ocean line itself is the carrier's base rate for the port pair. On top of it sit surcharges that move independently, and they are where a quote stops being a fixed number.
A quote valid for fourteen days is normal. A quote with no validity period is a number without a date, and on a volatile lane it means the carrier can revise it before the booking is confirmed.
These are the lines that make a cheap ocean rate expensive or an expensive one fair. They are charged per container or per shipment, and they are largely fixed regardless of what is inside the box.
| Line | What it pays for | Typical basis |
|---|---|---|
| Origin THC | Terminal handling of the container at the loading port | Per container |
| Documentation fee | Issuing the bill of lading and the manifest entry | Per bill of lading |
| Booking or handling fee | The forwarder's own administration of the booking | Per shipment |
| Export declaration | Lodging the export entry with Chinese customs | Per declaration |
| VGM and weighing | Verified gross mass of the packed container, required before loading | Per container |
| Seal | The numbered seal on the doors, recorded on the bill | Per container |
| Trucking | Factory to terminal, including the chassis and driver | Per container, by distance |
| Telex release | Releasing cargo without the original bill of lading | Per bill of lading |
| CFS handling | Receiving and stuffing cartons at a consolidation station | Per cubic metre, LCL only |
| Insurance | Cargo cover, usually charged on a percentage of the insured value | Optional, but rarely wise to skip |
Typical line items and charge bases on a South China export booking. Amounts vary by forwarder, carrier and season — not a commitment.
Two lines deserve a question every time. Trucking is quoted for a specific factory address, and a supplier who moves the loading point after the quote invalidates it. Export declaration is charged per declaration, so goods consolidated from three factories into one container are still one declaration — but goods with different HS chapters may attract more scrutiny and more time.
VGM is not optional. A packed container needs a verified gross mass before it can be loaded, and the figure has to come from a weighing or a certified calculation method. A quote that omits it is not cheaper, it is incomplete.
Insurance is optional in the sense that nobody will refuse to load your cargo without it. The carrier's liability is capped by convention at a level far below the value of most commercial shipments, so the gap is yours to carry unless you buy cover.
Telex release is optional in the sense that you can choose to send original bills by courier instead. On a first order, the original set is sometimes what the supplier's bank or your own requires. On a repeat order, the courier cost and the two weeks it takes are usually avoidable.
Everything else on an origin invoice is a charge for something that happened. If you do not recognise a line, ask what triggered it. A legitimate answer takes one sentence.
The block that decides your landed cost is the one most quotes leave out. Destination terminal handling, documentation and delivery order fees are billed at arrival to the consignee, and they are set by the destination agent rather than by anyone in Guangzhou.
On some trades they are modest. On others they exceed the ocean freight. The only way to know is to ask for them in writing, at the quoting stage, in the same currency you will be invoiced in.
If a forwarder cannot quote destination charges, they can at least tell you who will. That name and a contact is worth having before the container sails, because the conversation at arrival happens on the terminal's timetable, not yours.
Freight prepaid or collect. Which one appears on the bill of lading decides who is pursued for the ocean freight. Prepaid means the shipper pays in China. Collect means the consignee pays at destination, and the destination agent will not release the cargo until they do. If you are the buyer and the supplier offers a suspiciously low price, check which one is on the bill.
An all-in figure is convenient and almost always built differently from the next all-in figure. One includes trucking and excludes VGM. Another includes VGM and excludes the export declaration. A third includes everything except the telex release, which is only needed if you want the cargo released without paper.
The comparison that works is a single sheet with the same lines in the same order for every quote. Ten lines, one column per forwarder. The cheapest total is then visible, and so is the reason it is cheapest.
Add one column that is not money: validity. A quote that expires in a week and a quote that holds for a month are different products, and on a rising market the longer one is worth paying for.
Ask these before you compare anything.
None of these questions requires technical knowledge. They require the quote to be specific, which is the whole point of asking.
The currency a quote is written in is part of the quote. A rate quoted in US dollars and paid from a euro account carries a conversion nobody negotiated, and on a container it is not a rounding error. Ask which currency the invoice will be issued in, and whether the rate is fixed or converted on the day of payment.
The Incoterm matters for the same reason. An FOB price and a CIF price for the same goods differ by the freight and the insurance, so a comparison between them is not a comparison of forwarders. Fix the term before you collect numbers.
Two components move after a quote is issued: the bunker adjustment and the peak season surcharge. A quote that says it is subject to carrier surcharge at the time of shipment is honest and unpredictable. One that fixes them for thirty days is worth a small premium on a rising market, because the number you budgeted is the number you pay.
Last, ask what happens if the volume changes. A rate quoted on five cubic metres and shipped at eight is repriced, and it is repriced at the rate of the day rather than the rate of the quote. On an LCL shipment that has grown, that difference can quietly exceed the saving you negotiated.
Q Why is the destination charge higher than the ocean freight?
Because the two are priced on completely different bases. Ocean freight is a competitive rate set by carriers on a lane; destination charges are set by the arrival agent and include terminal handling, documentation, delivery order and often equipment charges. On some lanes and some destinations the local block genuinely exceeds the freight.
Q Should I ask for an all-in rate or a broken-down one?
Ask for both. The breakdown is what lets you compare, and the all-in figure is what you budget. A quote that only offers all-in is not wrong, but you will not know what you are buying.
Q What is VGM and can it be avoided?
Verified gross mass: the weight of the packed container, confirmed by weighing or by a certified calculation method, submitted before the box can be loaded. It cannot be avoided, only done properly or badly. An inaccurate VGM is a safety issue and a reason for the terminal to refuse the box.
Q Are freight quotes negotiable?
The forwarder's own handling fee usually is, especially on a repeat lane or a committed volume. The carrier's ocean freight and surcharges are less so, and on a tight market not at all. Ask which part is theirs.
Q What does a telex release cost and when do I need one?
It is a small per-bill charge that lets cargo be released at destination without the original paper bill of lading travelling by courier. You need it whenever the consignee does not require originals — which on a first order is a question worth asking your own bank before you assume.
Q Can a quote include duty and delivery to my door?
Yes, under DDP terms, and that is a different product from a port-to-port quote. A DDP price bundles freight, duty, import clearance and delivery, which means the forwarder is estimating your duty. Ask what happens if the classification turns out differently, because that is where DDP quotes get renegotiated.
Related pages
Send us both and the shipment details. We will put them on one sheet with the same lines, and tell you which is actually cheaper for your cargo.
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