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Ukraine – China: how to set up efficient logistics

Features of arrangement of logistic processes, planning stages, subtleties of choosing a logistics operator – these and other components of successful export of products to China were covered by GC ZAMMLER expert Ms. Kateryna Petrochenko at the workshop “Kick-off event: go China” within the framework of #GoChina program. During the event, representatives of small and medium-scale businesses had an opportunity to learn about the major mistakes made by exporters and the ways to avoid them.

The project was initiated by the #EU4Business and implemented by the European Bank of Reconstruction and Development, with information support from the Export Promotion Office and in partnership with the Chinese Trade Association.

In her speech, Kateryna Petrochenko said that in order to build effective export logistics, it is necessary not only to clearly define an algorithm of actions (to find a logistics provider, to sign a contract and to monitor the compliance with its terms), but also to deepen and agree on delivery terms (INCOTERMS), to approve the deadlines and to settle financial issues with the recipient issues, taking into account seasonal fluctuations and peak loads. Monitoring and information pre-gathering will be helpful to avoid the most common mistakes due to a lack of sector-specific knowledge.

When planning a shipment, it is important to consider the quantity of goods, their weight, volume, dimensions, fragility, required temperature conditions and cargo type (specification). Having provided all the necessary information to the logistics operator, the exporter will receive a calculation of the delivery time, the arranged itinerary, the optimal transportation type, the estimated shipping cost and, if necessary, the recommended packaging method.

According to the speaker, “It is important not to miss anything, from packaging to taking into account weather conditions during transportation. It is necessary to understand what method of fastening is intended for specific goods, and to apply the correct marking and manipulation signs”.

The most common mistakes made during transportation include incorrect cargo distribution inside the vehicle, absence of marking or errors in it, a difference between the declared and actual cargo weight, poor quality packaging, non-compliance with the prescribed temperature conditions, etc.

When choosing a mode of transportation it should also be understood that each type of transport is different in terms of delivery deadlines and capabilities that directly affect the cost of services.

As explained by Kateryna Kolesnyk, “Among the advantages of maritime transport are relatively inexpensive service, suitability for a large group of goods, the most rational transportation option for cargoes up to 15 m3 in volume and up to 10 tons in weight, whereas the disadvantages include long delivery time, dependence on weather conditions,  seasonality. If we talk about air transport, its advantages are high speed of delivery, maximum compliance with deadlines, minimization of any external factors and risks, maximum preservation of cargo, the ability to deliver small consignments of goods (such as product samples). But there are also disadvantages such as high cost of delivery, dependence on weather conditions, limited geographical accessibility”.

Shipping costs vary depending on the port, delivery types and requirements under the contract between the consignor and the consignee, so the expert recommends making individual calculations in each case to find the best deal.

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