Do I need a 3PL in China as well as in India?

Do I need a 3PL in China as well as in India?

ANSWER:

That depends on the incoterms of your order. For example, if you are buying DDP, then the seller will organize the logistics. If the buyer is purchasing under FOB or CIF terms, then in most cases the buyer will contract at 3rd Party Logistics provider to help with the delivery and inbound custom’s clearance.  In my experience, assuming you are buying “FOB China port” (which is the most common incoterm for China sourcing) the best option would be to find a 3PL that is experienced clearing customs in your destination port who ideally also has experience with shipments out of China of similar product classifications to what you are buying.

Here are some links to articles and  blog posts that explain how to find and manage a 3PL:

http://chinasourcinginfo.org/2010/12/14/qualifying-3rd-party-logistics-3pls/

Making use of 3PL Service Providers

If you are buying ExW, then you take title to the goods at the factory door in China. This option is not recommended for most small buyers because it is very complex for a foreigner without operations in China to clear outbound China customs and arrange taxes. See here for more information on the headaches of buying ExW.  But if you are buying ExW, then I would suggest you find a China based 3PL or better yet a trading company with an export license to help you get the goods out of China and delivered to India.

Thanks again for your question. Let us know how things work out for you.

Wishing you successful China sourcing!

Question answered by Mike Bellamy, host of “Ask the Experts” at the China Sourcing Information Center.

Mike Bellamy is an Advisory Board Member & Featured Blogger at the not-for-profit China Sourcing Information Center (www.ChinaSourcingInfo.org). He is also the author of, “The Essential Reference Guide to China Sourcing” (chinasourcinginfo.org/book) and founder of PassageMaker Sourcing Solutions (www.PSSchina.com )

Leave a Comment