First time importer to Australia tips

Help for first time importers

We understand how challenging it is in in Australia when you are a first time importer. We are here to help and have listed the major things for to you to know about:

Find out what you need to know regarding import documentation. Or feel free to ask for help directly by calling us on 1300651233 or sending us a message.

Help for first time importer to Australia

Basic shipping terms every first time importer should know

You don’t need to know all the shipping terms, but it is a must to be familiar with the following terms when importing into Australia.

Ex Works

This is a term used for transactions where the buyer assumes all the transportation costs and risks associated with it. However, the seller ensures that the goods are ready for pick-up at their own place of business.

Here at FFQO, we deliver Ex work services for you and it covers:

  • Export documents/clearance
  • Export pick up
  • Freight
  • Destination port surcharges
  • Customs clearance
  • Delivery

Free Carrier (FCA) / Free on Board (FOB)

Free Carrier (FCA) and Free on Board (FOB) work similarly with Ex Works except that the risk of loss is not entirely with by the buyer.

The responsibility over the goods for shipment is shifted to the buyer only after it has been transported from the seller’s premises to the port of origin. At this point, the loading of goods at the port of origin and the transportation of the goods to its destination now become the buyer’s obligation.

FFQO can handle this for you. Our services include:

  • Freight
  • Port Surcharges
  • Customs Clearance
  • Delivery

Cost & Freight (CFR ) / Cost, Insurance & Freight (CIF)

This is where the seller of the goods assumes all the costs and risks associated with the transportation of the goods to the destination port. This includes cargo insurance. The buyer of the goods is responsible for the unloading and customs clearance of the goods at the destination port as well as the transportation of the goods to the door.

With/less Australian customs fees

Whether the terms are Ex Works or FOB/FCA, it is optional if you wish the cost of Australia customs fees included. Want you are looking for an import freight quote that includes Australian customs costs then the terms are with Australia customs fees. If you wish to pay the Australia customs yourself, you the terms are less Australian customs fees.

Want us to handle the customs fees, GST, duties all straight to delivery? We can do it for you. Call us at 1300651233.

Terms do not include quarantine and insurance

Be reminded that the above shipping terms do not include quarantine fees. Talk to us, if you have a product that ‘maybe’ subject to quarantine.

Also cargo insurance is also not included. However, you can use the following formula to get an estimate of how much it will cost:

  • Insurance cost  estimate = Cargo value x  0.006 AUD

Note the minimum charge is AUD$85.00

Basic shipping terms to know for a first time importer

Guide on how to calculate customs fees for a first time importer

It is important for you to know how to calculate customs lodgement fees. Here is a guide on how you can calculate it.

Value under AUD$1,000

Except for alcohol and tobacco products, all goods valued under AUD$ 1,000 are free from Customs Duty and GST. However, an Import Doc Lodgement fee has to be paid.

Between AUD$1,000 and AUD$10,000

Customs fee for goods valued between AUD$1000 and AUD$10,000 are calculated as follow:

  • FCL Import Dec Fee AUD$65.00 + $30.00 per container
  • LCL Import Dec Fee AUD$75.00
  • Airfreight Import Dec Fees AUD$56.20

More than AUD$10,000

Customs fee for goods valued more than AUD$10,000 are calculated as follow:

  • FCL Import Dec Fee AUD$167.60 + AUD$30.00 per container
  • LCL Import Dec Fee AUD$175.60
  • Airfreight Import Dec Fees AUD$138.10

Are you a first time importer that needs help with custom fee calculations?

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Easy guide to estimate duty for a first time importer

Duty can be easily estimated based on the value of the imported goods. Here is a guide for first time importers on how it you can estimate it.

Imported goods valued under AUD$1,000

Goods valued under AUD$ 1,000 are Duty free.

Estimation of Duty on imports over AUD$1,000

You may calculate your Duty on import product valued over AUD$1000 by following this formula:

 

  • Estimated duty = (Product value + Freight Value)  x 0.05 AUD

 

Note that duty-free can apply for goods coming from several countries where Australia has Free Trade Agreements. You can refer to our duty guide which covers common products and countries of origins.

To know exactly what the duty will be means knowing how to classify your goods properly. This can be tricky as some products fit into several categories. Feel free to contact us for help on this.

Reduce your Duty with Free Trade Agreements

Duty-free can apply for goods coming from several countries where Australia has Free Trade Agreements (FTA). This includes:

  • Chile
  • China
  • India
  • Indonesia
  • Japan
  • Korea
  • Malaysia
  • New Zealand
  • Singapore
  • Thailand
  • US
  • ASEAN

Other countries have their own Trade Agreements with Australia. Talk to our team to learn if your item is duty-free.

Terms to know as a first time importer

Simple guide on GST calculation for a first time importer

GST payable, just like the duty and customs fees vary according to the value of the imported goods. Note that this includes gifts.

Here is a first time importer GST calculation guide.

Imported goods under AUD$1,000.00

As mentioned above, goods valued under AUD$ 1,000 is GST free.

Imported goods over AUD$1,000

You may calculate your GST on import product valued over AUD$1000 by following this formula:

  • GST = (Product value + Freight Value + Duty  + Insurance ) x 0.10 AUD

Ensure you are paying the right GST

Speak to us to know the exact GST you need to pay, rather than assume your product will be 10%. There might be certain conditions that could make it lower or nil.

Feel free to call us on 1300651233 or send us a message.

Are you a first time importer that needs help with GST calculations

How to calculate chargeable freight for a first time importer

Chargeable freight is how freight is costed. This is how freight companies deal with how some shipments do not take up much space or take up a lot of space but do not weight much.

Calculating chargeable freight for air and sea (LCL) is different. With air freight the chargeable is worked out based on weight while with sea (LCL) is is based on volume. Below we have examples that show how chargeable weight for air and chargeable volume for sea (LCL).

Calculating chargeable weight for air freight

Example 1

1. Know your actual volume in cubic meters (cbm).

Formula: length x width x height
Example: 1.0m x 1.2m x 1.3m = 1.56cbm

2. Know your volumetric weight.

Air cubic conversion factor = 167
Formula: actual volume x 167
Example: 1.56 cbm x 167 = 260.52 kg

3. Compare the volumetric weight and the gross weight. Whichever is greater will be your chargeable weight. As actual weight is 200kg the chargeable weight is then 260.52 kg.

Example 2

1. Know your actual volume in cubic meters (cbm).

Formula: length x width x height
Example: 1.2m x 1.5m x 0.5m = 0.9cbm

2. Know your volumetric weight.

Air cubic conversion factor = 167
Formula: actual volume x 167
Example: 0.9cbm x 167 = 150.30kg

3. Compare the volumetric weight and the gross weight. Whichever is greater will be your chargeable weight. As actual weight is 300kg the chargeable weight is then 300kg.

For a summary of sample chargeable freight calculations for air and sea, download the PDF.

Calculating chargeable volume for sea freight LCL (less than container load)

Example 1

1. Know your actual volume in cubic meters (cbm).

Formula: length x width x height.
Example: 2.0m x 3.5m x 1.5m = 10.5cbm

2. Know your weight-based volume.

Sea cubic conversion factor for sea freight LCL = 1,000
Formula: actual weight / 1,000
Example: 12,000 / 1,000 = 12.0 cbm

3. Compare the weight-based volume and the actual volume. Whichever is greater will be your chargeable volume. As actual volume is 10.5cbm then the chargeable volume is 12.0cbm

Example 2

1. Know your actual volume in cubic meters (cbm).

Formula: length x width x height.
Example: 1.5m x 3.0m x 1.2m = 5.4cbm

2. Know your weight-based volume.

Sea cubic conversion factor for sea freight LCL = 1,000
Formula: actual weight / 1,000
Example: 4,000 / 1,000 = 4.0 cbm

3. Compare the weight-based volume and the actual volume. Whichever is greater will be your chargeable volume. As actual volume is 5.4cbm then the chargeable volume is 5.4cbm.

For a summary of sample chargeable freight calculations for air and sea, download the PDF.

Calculating chargeable freight for sea freight FCL (full container load)

You only need to work out the chargeable freight for sea freight FCL (full container load) when the cargo is usually heavy. It is best to contact us if you think this is the case as it likely that the shipment is quite specialised and have other conditions that need addressing.

Feel free to call us on 1300651233 or send us a message.

Tips on air freight transit options for a first time importer

Your choice of transit depends on the speed of delivery required to ship your goods. Here is an example showing you the three main transit options available.

Say we have a box of collectable magazines (100 kg) we wish wishes to ship from Hong Kong into Australia.

Note that this is an example of price difference between the options to show the likely savings. It does not include local delivery and fees at the destination.

Direct

This will ship via main hubs such as Hong Kong, Dubai, Abu Dhabi, Bangkok and Singapore

  • Transit option: Ship item via Cathay Pacific
  • Transit time: 1 day
  • Cost: USD$ 9.75 /kg x 100 kg = USD$975.00

Premium deferred

This ships through the hub in Bangkok

  • Transit option: Ship item via Thai Airways
  • Transit time: 1 to 3 days
  • USD$ 9.00 /kg x 100 kg = USD$900.00

Non-premium (cost effective) deferred option

This ships via hub in Denpasar

  • Transit option: Ship item via Garadu Airways
  • Transit time: 4 to 6 days
  • Cost: USD$ 7.50 /kg x 100 kg = USD$750.00

You can see when you have flexibility in the require delivery date that the change in cost is significant.

Air Transit options

 

Options for air freight transit for the first time importer

Air freight vs sea freight – to fly or float

This is a common question for first time importers and the answer varies depending on several factors. However, the most important is usually the required delivery date.

Sea freight when time not an issue and over 100kg

The most economical to send cargo is via sea freight. Especially when:

  • delivery can be several weeks to months away
  • the exact date is not critical
  • your shipment is is over 100 kg

While we use premium ocean carriers, there can still be short delays in sea freight of 2-3 days in transit due to weather or port delays. Look at going this way closely this is something your “customers” would deem “acceptable.”

Air freight when speed needed

When the required deliver date is tighter or needs to be exact, it is best to air freight. It will generally get there in less than a week or two but it’s more expensive – especially when it is the cargo is heavy or bulky. There are several air freight transit options you can consider that make the delivery time a little more flexible and so reduce the cost.

What about reliability?

You also need to consider the shipping companies you will be dealing with. Remember that shipping companies are also trying to reduce their cost and run in the most cost effective fashion. How aggressive they are driving down costs can make them more prone to delays than others. To know exactly who is best to use for what situation takes experience and expertise. That’s why we are here to help.

Feel free to call us on 1300651233 or send us a message if you need more help working out whether air or sea freight is best for you.

Air freight vs sea freight - fly or float