Useful Information - CHINA WHOLESALE RADIO CONTROL TOYS

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Useful Information

THE MAGIC OF
ONE CUBIC METRE
(1m x 1m x 1m)

Secrets to making real profits when importing from China!
Let's face it... You've heard the hype about the fantastic savings that can be made when buying from China. Huge savings equals bigger profits. But is this really too good to be true, or simply a myth? It's actually a bit of both, especially for Wicked Export Buyers

But the magic formula really boils down to one thing. As a small volume buyer:

BIG PROFITS CAN ONLY BE MADE WHEN YOU SHIP BY OCEAN FREIGHT!

You are probably thinking "But I'm only ordering in small quantities, not nearly enough to fill a container!". The truth is nowadays, freight business is so advanced that anyone can afford to use LCL shipments i.e. Less than Container Load, as opposed to FCL Full Container Load. Back then, not many shipping companies were willing to entertain LCL shipments, and probably cost you a fortune if they do. Today, there are so many brokers who offer cheap rates for LCL shipments, since they book an entire container and sublet spaces to customers.

LCL shipments are subject to minimum charge of 1 cubic metre. That means that if you ship products that occupy less than 1 cubic metre, you will still be billed the minimum amount. On top of this, there are fixed administration and paperwork costs per shipment, no matter how big or small your shipment is. So things to note are:1. LCL shipments are charged based on a minimum 1 cubic metre (cbm).2. Other export related costs are fixed, no matter how large or small your LCL shipment is. CASE SCENARIO

We had customer who wanted to order 20 pcs of picnic bags as a trial order to Chicago, USA. Here are some comparisons by air vs ocean freight. AIR FREIGHT (5-6 days):

Weight of 20 picnic bags:	54 KG
Volumetric cubic metre:	0.35 cbm
Cost per picnic bag:	$9.83

Freight Cost:	$310
Export Related Cost:	$95(fixed no matter how small or large the shipment)
Total Cost:	$310 + $95 = $405

Shipment cost per item:	$405 / 20 picnic bags = $20.25 per picnic bag

*In this situation, it costs $20.25 to ship a picnic bag worth $9.83. Hence, the total true landed cost of this product is $30.08. Definitely too expensive to make a decent profit! OCEAN FREIGHT (3-5 weeks):

Weight of 20 picnic bags:	54 KG
Volumetric cubic metre:	0.35 cbm
Cost per picnic bag:	$9.83

Freight Cost:	$80 (based on minimum charge of 1 cbm)
Export Related Cost:	$120 (fixed no matter how small or large the shipment)
Total Cost:	$80 + $120 = $200

Shipment cost per item:	$200 / 20 picnic bags = $10 per picnic bag

*In this situation, it costs $10 to ship a picnic bag worth $9.83. Hence, the total true landed cost of this product is $19.83. Definitely more cost effective than shipping by air, but profits are still not optimized! However, this customer only used up one-third of his allocated space in which he still has to pay the minimum charge of $200.
Profit can still do much better. It's now time to exercise the MAGIC One Cubic Metre formula...

We persuaded the customer to order 60 units of picnic bags instead so that his entire allocated space is used up WITHOUT HAVING TO PAY ANY EXTRA CHARGES.

Now watch what happens here...OCEAN FREIGHT (3-5 weeks):

Weight of 20 picnic bags:	162 KG
Volumetric cubic metre:	1.05 cbm
Cost per picnic bag:	$9.83

Freight Cost:	$80 (based on minimum charge of 1 cbm)
Export Related Cost:	$120 (fixed no matter how small or large the shipment)
Total Cost:	$80 + $120 = $200

Shipment cost per item:	$200 / 60 picnic bags = $3.33 per picnic bag

*In this situation, it now only costs $3.33 to ship a picnic bag worth $9.83! Real profits begin here! The true landed cost of each picnic bag is now only $13.16.
The more you cubic metre units you ship, the more you save...

Since export related costs such as dockage, cartage, administration fees are fixed and charged at a flat rate no matter how big or small each shipment is, the shipment cost per item continues to decrease with the additional number of cubic metre units you ship.

Now assume the customers orders 300 picnic bags equivalent to 5 cubic metres OCEAN FREIGHT (3-5 weeks):

Weight of 20 picnic bags:	810 KG
Volumetric cubic metre:	5 cbm
Cost per picnic bag:	$9.83

Freight Cost:	$400 (based on minimum charge of 1 cbm)
Export Related Cost:	$120 (fixed no matter how small or large the shipment)
Total Cost:	$400 + $120 = $520

Shipment cost per item:	$520 / 300 picnic bags = $1.73 per picnic bag

*In this situation, it now only costs $1.73 to ship a picnic bag worth $9.83! Optimum profits are now achieved! The true landed cost of each picnic bag is now only $11.56.

Conclusion:

So what does this mean for wickedexport.com buyers? Wickedexports.com offers you the opportunity to import products from various suppliers around China in minimal amounts in order to test your market without incurring too much stock investments. And once you know your products sell well, buying in large volumes to capitalize on bigger product discounts and shipping savings would be the next obvious step.