Exporting to the Middle East
BRUNEL AIR CARGO CASE STUDY - TEMPERATURE CONTROLLED TO MIDDLE EAST
Moving goods that are to be kept in a temperature controlled environment can be complex at the best of times, but it is even more difficult when it is specialist electronics and specialist construction materials that are perishable. Exporting to the Middle East needs detailed planning.
Brunel Air Cargo was tasked with moving multiple containers of equipment and inventory under very tight restrictions to the Middle East, including a range of hazardous goods. The total value of the materials was over 25 million pounds.
The project required a full multimodal transport solution including road, air and sea freight (the road and sea freight was covered by our sister companies Brunel Shipping and Brunel European.
As you can imagine, the logistics and timing was key, so our first step was to meet with the client and discuss timelines. Equipment was exported and shipped over a 12 month period and had to arrive in time for each phase of the construction project.
Any hold up would have caused a massive loss both in terms of revenue for our client (penalties from their own client) but also costs of paying their own construction staff who would have been idle but still costing money in salaries and daily contract rates.
If you have ever exported to the Middle East then you will know that there are some intricacies and let's say "hidden financial costs."
We want to share with you our experience of this project, some of the issues we had to deal with and 5 tips you can use yourself to make sure exporting to the Middle East is as painless as possible.
So our responsibilities were:
1. Liaising with the client's suppliers in the UK and overseas.
2. Arranging collections of un-packed freight, and providing professional export packing. We did this at our Heathrow warehouse facility as we have an in-house packing company.
3. Arranging correct documentation: Certificates of Origin, commercial invoices and loading lists that needed to be attested and chambered by the local chamber of commerce.
4. As the client did not have a legal entity in the Kingdom of Saudi Arabia, Brunel set up a Foreign Importer of Record (IoR). This allowed us to import goods into Saudi Arabia and be fully compliant with local legislation.
5. We managed the client's duty & Zakat taxes monthly, and submitted monthly billing back to the client for funds. If this was not done, then each time they had an export the funds would have to be paid immediately.
6. Our local office in Saudi Arabia liaised with the consignee and project managers locally in Saudi, hence providing a local point of contact to ensure all updates were communicated accordingly.
7. Some of the clients products required temperature controlled logistics, we offered this as a value add to the client, as our vehicles, warehouses and aircraft were able to keep their sensitive electronics and temperature sensitive cargo at constant climate control. This had to be between 10-20 degrees celsius and had to be managed on all road, air and sea freight. This was key to maintain product conformity in terms of quality and durability.
8. Our local office in Saudi Arabia also arranged support for the client's employees. People working on the major construction site who were returning back to the UK received full logistical support. We arranged air freight from Saudi to the UK for personal import clearance and delivery to the employee’s home addresses saving employees any duty, and at the same time building a strong employer/employee relationship.
9. Providing 24 hours a day support to the client and advising them on existing and new trade restrictions. Over the course of the project we managed to save the client in excess of half a million pounds just based on some materials that were restricted in Saudi Arabia that would have been confiscated and destroyed.
Here are 5 key things we learned during this project:
1. Attesting or legalising commercial paperwork is a time consuming process so having a local subsidiary to help, eliminated both time and cost.
2. Making sure that Certificates of Origin were matched correctly was vital. We saw a number of shipping companies exports impounded because of a lack of COR's.
3. Enlisting a local import agent saved the client local "hidden taxes".
4. Setting up monthly duty and Zakat tax payments allowed the client greater cash flow. Something you should think about when exporting to this region.
5. Working closely with shipping lines to ensure that the temperature is set accordingly in the aircraft and FCL containers meant no equipment or goods were damaged or perished.
I hope you have enjoyed this short case study and that it may help you if you are exporting goods by air or sea freight to the Middle East.
If you have any questions about exporting goods in a temperature controlled environment by air freight, or you need advice on air charter services or express air courier services then give us a call on +44-0-1753-685900 and one of our expert team will be happy to advise you on how we can help.
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