Hi, we have recently opened a company in Bangalore India and have sent our first consignment (5 pallets) via sea to Bangalore ICD. We have been sent an invoice for approximately £650.00 (excluding local duties and taxes) by our freight company’s agent in India. We feel that this is exceptionally high and would be grateful for some expert advice as to what is the best way forward. We think the problem has arisen as we assigned our freight company on a CFR basis into Bangalore ICD. They have used an agent who collects from Singapore to Chennai and then onto Bangalore ICD, and this is where the invoice has been generated from. We have argued the point with our carrier, but they are adamant that we are liable for this charge. We have our own agent who will pay local duties and taxes once the goods have been cleared, which is now being held up by this third party. Can you kindly advise? Thanking you in advance. Lisa Hart, Power Adhesives Ltd
This is Ian from STI Global, you have been caught by one of the oldest tricks I am afraid.
We have a weekly FCL and LCL service to India and are one of the biggest freight forwarders dealing between UK and India at present so speaking to me will definitely help… Our service is direct to Chennai is not via Singapore or anywhere else for that matter.
You need to advise them to note that CFR means: (Cost and Freight) the seller (YOU) are responsible for all costs UNTIL the goods have landed at a named Destination PORT in the country of arrival (IE Chennai). As soon as the goods are unloaded from the vessel the BUYER is responsible for ALL costs and risks involved from there until the cargo reaches its final destination (IE Bangalore ICD). They have been very crafty here as your goods have been transhipped via Singapore to Chennai then onward by road to Bangalore ICD. Doing it this way you are STILL only liable for costs up to arrival destination Port which in this instance is Chennai under CFR Terms. Your customer is liable for any costs ex Chennai Port up to arrival Bangalore ICD not you.
If you need any further advice on this or a reliable agent to handle your work to India please feel free to call or email me as follows:
Company; STI Global Logistics Ltd
Contact: Mr Ian Robery
Tel; 01268 289653
If you need rates and a reliable service from a reliable agents please contact STI.
Look forward to your call or email.
Hi Lisa, agreed it does look excessive. You need to establish exactly where the charges are arising from. If you requested a quote to Bangalore, booked to Bangalore based on a quote to Bangalore and have bills of lading that show Bangalore as the final destination then you should not be paying anything more than you agreed. If you can get a break down of the charges we can establish if they are local charges in India or part of the CFR movement and advise you accordingly. Unfortunately possession is 9 10ths and they know it, however if you can construct a decent argument you do stand a chance. There is also the question of storage, when did it arrive or is it still on route? Happy to help if you would like to discuss in a bit more detail you can contact me on 02392 756575 or firstname.lastname@example.org
I came across this post 2 years late but thought it worth adding my 2 bits. I read a lot of the resources on this site so thought I would avoid the common pitfalls but managed to land in a few anyway.
I called STI Global due to the helpful post offered above and should’ve known better when I was told that the individual who posted had left the firm. I let my guard down and was taken on a similar ride as described by Ms. Lisa Hart above. I was quoted for Felixstowe-Colombo-Chennai-ICD and was then booked onto Southampton-Singapore-Chennai-ICD (10 days longer voyage and probably more loading/unloading and documentation).
I’ve got emails to prove all of the above. Here’s a few lessons for those with generic exports from U.K to India:
0. Once your goods are collected by the freight forwarder, you have little choice but to go along as a u-turn will result in the freight forwarder charging you exorbitantly for things like handling and storage etc. So don’t be in a hurry to ship.
1. For exporters to Bangalore ICD (or any Indian port for that matter) FOB shipment terms are almost always most appropriate. Advise the importer that hiring an Indian freight forwarder is the most cost effective. Use a U.K agent for the U.K. collection, THC, port and customs entry but let the importer’s agent handle everything else. If you really want to cut costs, find out whether the importer’s agent can find you an agent in the U.K. to do the U.K. end of activities for you – they’ll probably be happy to shop around on your behalf. Not only do you save yourself a lot of hassle, it’s almost always significant cheaper for the combined (buyer + seller). GBP has a long way to depreciate and most U.K. freight forwarders have a lot to learn about service before they are competitive.