Page 42 - Export and Trade

sea or airfreight; cleared through Customs, the Ministry FXELFPHWUHVRU¿YH WRQVPD\EHKDUGWRVKLSWRVRPH
IRU3ULPDU\,QGXVWULHVDQGVHFXULW\ VKLSSHGRUÀRZQWR destinations quickly as aircraft space is often limited.
DIRUHLJQSRUW SRVVLEO\YLDDWUDQVKLSPHQWKXE DQG 4. International courier. Door to door service that is
cleared through Customs at the destination and, possibly, generally faster than standard air freight. International
quarantine and more security. Finally, the goods need to Courier is often cheaper than air freight for weights
bedeliveredtoyourbuyer’spremises.Ifyouarenewto less than 20kg, but rapidly gets much more expensive
exporting, it’s best to use a freight forwarder for this. for heavier goods. Couriers use a different formula for
weight/cube conversion (for example, with DHL, for
Therearefourmaintransportoptionstoconsider: 7LPH 'H¿QLWH 'D\ 'H¿QLWH DQG LQWHUQDWLRQDO 6DPH 'D\
1. Full container load (FCL), sea freight. Good for shipments the conversion factor is 5000. The formula
bulkyorheavycargo.Generallythebestoptionfor for calculating volumetric weight is length x width x
cargoover15cubicmetresor15tons.A20-foot KHLJKW FP
FRQWDLQHU WKHVPDOOHVW FDQWDNH FXELFPHWUHVRU
JHQHUDOO\ WRQV $ IRRW KLJK FXEH FRQWDLQHU Is the cargo properly insured?
WKH ODUJHVW FDQ WDNH FXELF PHWUHV RU JHQHUDOO\ You will already have agreed the terms of business with
25 tons. your buyer, which will cover all aspects of sale and supply,
Itmayseemstrangetoyouthatthetwodifferent including where the insurance risk lies along the journey.
sized standard containers take the same weight. This Depending upon the terms of sale, you might or might not
isduetoinfrastructureconstraints;thelimitation be contractually obliged to insure the cargo. If you bear
ofliftingequipmentandthelegalweightlimitsfor the risk, we strongly advise you to take insurance cover,
road transport. However, if you have any questions even though there is no contractual obligation to do so.
regarding container weights, it’s best to consult your The New Zealand Carriage of Goods Act only applies
freight forwarder. to the part of the export journey within New Zealand. To
Sea freight transit varies from one week to the east claim under it, you need to show that the loss or damage
FRDVW RI $XVWUDOLD WR ¿YH ZHHNV GLUHFW WR (XURSH SRUW RFFXUUHG ZLWKLQ 1HZ =HDODQG ZKLFK LV RIWHQ YHU\ GLI¿FXOW
WR SRUW International carriers’ liability limits are generally very
2. Less than container load (LCL), sea freight. If you low, and because each shipment involves multiple carriers,
GRQ¶W KDYH HQRXJK FDUJR WR ¿OO D FRQWDLQHU \RX FDQ HVWDEOLVKLQJ ZKLFK FDUULHU LV OLDEOH LV H[WUHPHO\ GLI¿FXOW
share one with other exporters. You pay based on the $V D ¿UVW WLPH H[SRUWHU LW V UHFRPPHQGHG \RX WDON WR
volume and weight of your cargo (you will be charged your business insurance broker about marine risk (which
basedonwhicheveristhehigher:cubicmetresor DOVR FRYHUV DLUIUHLJKW WR HQVXUH \RX XQGHUVWDQG ZKLFK
WRQV 7KLVJHQHUDOO\RIIHUVJRRGYDOXHIRUPRQH\IRU type of marine insurance is best for you. (There are some
FDUJREHWZHHQ RQHFXELFPHWUH DERXW NJ DQGXS KLVWRULFDO TXLUNV UHODWLQJ WR ³JHQHUDO DYHUDJH´
WR FXELF PHWUHV RU WRQV VXEMHFW WR GHVWLQDWLRQ There are three insurance categories that are used
product and time-lines. Transit times are a little slower internationally:
WKDQ)&/VHD IUHLJKW E\ DIHZGD\VLQPRVWFDVHV 1. Free of particular average (FPA). You are covered if
This is because the cargo has to be consolidated and the entire consignment is lost or damaged, for example
deconsolidated as part of the transport process. ZKHQ D VKLS VLQNV RU GXH WR ¿UH +RZHYHU \RX DUH QRW
3. Airfreight. Excellent for urgent, high value or small covered for any partial loss or damage to your cargo.
and light cargo. Transit time is generally from overnight FPAcoveris usuallypurchased forusedgoods,suchas
to four days worldwide. For cargo under one cubic scrap metal.
metre or 300kg, air freight will often be cheaper than 2. With average (WA).This cover extends the FPA clause
sea freight. There are very tight rules around what to include partial loss arising from heavy weather and
counts as dangerous cargo for air freight, so if you are seawater damage.BothFPA andWAcanusuallybe
VKLSSLQJ DQ\WKLQJ ÀDPPDEOH FRUURVLYH RU SUHVVXULVHG extended to include protection from theft and pilferage.
PDNH VXUH \RX FKHFN ZLWK \RXU IUHLJKW IRUZDUGHU ¿UVW 3. All risks (AR). This cover is the most comprehensive
Airfreight is charged both on weight and volume. The cargo insurance available, providing protection against
cargo is weighed and measured. The volume in cubic loss or damage from external causes. Yet, the term 'all
metres is multiplied by 167 to give the “volumetric risks’, is misleading, as it does not cover loss or damage
weight” in kilos. You pay based on the larger of the arising from delay or inherent vice (deterioration or
actual and volumetric weight. Airfreight of more than 10 damage caused without outside help, e.g. milk souring,

40 NZ Export & Trade Handbook 2018