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Top 5 Source Countries for U.S. Footwear Imports

April 15, 2013 By 1 Comment

Formal, high fashion or casual; any kind, any style – we will take them all. Sometimes they hurt our wallet, and from time to time our feet, but we can never get enough of them. Ladies, not too hard to guess, right? Yes, I am talking about SHOES; I am sure you will all agree with me that we LOVE shoes!

I am not sure whether you have this same habit or not, but when it comes to me, if I buy something new I definitely check the labels to see where it was made. I guess it has to do with my job. Have you ever thought of which part of the world most shoes get imported from? Most of us probably never really pay attention to those tiny labels where it says “Made in China.” Well, please do not be too surprised, because just like any other commodity footwear is also outsourced, especially in the U.S. My job is in sales in the world of logistics and it has over the years has become an integral part of who I am, as I love to meet new people, help them and build relationships. I also have another passion which is fashion, and anything related to that world. Therefore, apparel and footwear have always been my favorite subjects. When I moved to NY I even took classes at Parsons School of Design right in New York’s Fashion District in order to learn how to market apparel and footwear. When I am on the job, the first thing I usually like to do is to analyze the commodities I target. Basically, the whole idea is to find good quality importers or exporters to introduce our services to. This year I decided to focus more on footwear as a commodity due to large volume of shipments imported from Asia .

During my analysis I ended up reading a lot of articles, many of which are from platforms that support the wholesale footwear industry in the U.S. Some were also from trade associations. This study really helped me to learn more about the commodity and I would like to now share with you in our blog some of those interesting subjects which captured my attention: [Read more...]

Filed Under: China, General Business, Global Trade

China’s Effect on The Global Commodity Prices

March 18, 2013 By Leave a Comment

Globalization has been the driving force of developing countries for the last decade or so, and trade from these countries flourished as a consequence of China’s close to double digit growth numbers. Although Chinese suppliers rely mainly on local companies to supply the raw materials, a significant number of raw materials are also outsourced by other countries. Top commodities that make up the list consist of: plastics (where it’s widely used almost in every sector), metals (silver, copper, steel), rubber and paper. If we look at the numbers per industry, where most of the imports of raw materials are used, the electronics industry tops the list with 30% of all raw materials used are imported from another country. Given the large amount of electronics shipped from China to all parts of the world, 30% seems to be a highly significant number where even small changes in demand effect the prices of commodities. Another interesting statistic is that per IMF numbers 40% of the world’s base metals (aluminum, copper, lead, zinc or nickel) is consumed by China to manufacture new products. [Read more...]

Filed Under: China, Global Trade, Shipping Trends

Top Five Busiest Ports in the World

January 21, 2013 By Leave a Comment

As a Logistics provider we deal with ports all around the world on a daily basis. The “busyness” of a certain port is measured by volume of TEUs. Now, what is a TEU? On the subject of ocean shipping, you hear the term TEU all the time. The Twenty-Foot Equivalent unit (TEU) is an inexact unit of cargo capacity often used to describe the capacity of container ships. One TEU represents the cargo capacity of a standard container, 20 feet long and 8 feet wide.

TEU capacities for common container sizes:

Length        Width             Height                   Volume                        TEU
20 ft (6.1 m) 8 ft (2.44 m) 8 ft 6 in (2.59 m) 1,360 cu ft (38.5 m3) 1
40 ft (12.2 m) 8 ft (2.44 m) 8 ft 6 in (2.59 m) 2,720 cu ft (77 m3) 2
45 ft (13.7 m) 8 ft (2.44 m) 8 ft 6 in (2.59 m) 3,060 cu ft (86.6 m3) 2 or 2.25
48 ft (14.6 m) 8 ft (2.44 m) 8 ft 6 in (2.59 m) 3,264 cu ft (92.4 m3) 2.4
53 ft (16.2 m) 8 ft (2.44 m) 8 ft 6 in (2.59 m) 3,604 cu ft (102.1 m3) 2.65
High cube
20 ft (6.1 m) 8 ft (2.44 m) 9 ft 6 in (2.90 m) 1,520 cu ft (43 m3) 1
Half height
20 ft (6.1 m) 8 ft (2.44 m) 4 ft 3 in (1.30 m) 680 cu ft (19.3 m3) 1

Now that we cleared up, lets take a closer look at the top 5 busiest ports of the world that handle the highest number of TEUs: [Read more...]

Filed Under: China, Global Trade, Shipping Trends, Supply Chain Planning

Cargo Security

October 8, 2012 By Leave a Comment

Due to the complexity of the supply chain, it becomes important to have the security measures, procedures and protocols in place to maximize cargo security. It will have great benefits not only to importers but also to the importing country as a whole. Importers buy cargo from the other end of the world, sometimes without seeing who the actual factory is. There may be a war going on or some natural disaster might have hit the country of importation. A lot of factors effect the cargo security, of course not all of them are controllable but by following a few steps, importers can take control of the security of their cargo and minimize the risks which might be costly in the end.

During my career here at MTS Logistics, Inc I have dealt with many different scenorios that I could never imagined could happen to any importer. From radioactive nails on the seal to untreated pallets I have realized that it is actually the same problem that’s happening over and over again to importers, and since these containers are being rejected by US Customs many of the incidents result in the return of the whole container back to its origin, which is only one of many possible outcomes. In the end it is the importer who suffers due to loss in sales, unmatched due dates and loss of image. Depending on the frequency of these issues and the size of the importer, it might have negative impacts on the overall well being of the company. You are an importer and you are buying goods from the other end of the world and you would like to know what more you can do to secure the well being of your cargo but don’t know how to? I have listed a few major steps that need to be taken to maximize the security of your cargo. From complex precautions to more basic ones, here is what I think that every importer must do: [Read more...]

Filed Under: China, General Business, Global Trade, Insurance, Shipping Trends, Supply Chain Planning

Is India the China 2.0?

September 24, 2012 By 2 Comments

From the day China decided to enter into World Trade Organization, it changed all the dynamics in global trade entering with its $500 million workforce with cheap labor and “stole” a lot of production business from all cheap labor countries. However over time with close to double digit growth nr’s, the workforce became more demanding and wages slowly started to increase, and even a massive $500 million workforce could not offset this increase. Another problem that hinders the growth is out of all emerging cheap labor markets, China has the oldest population now with a median age of 34 thanks to the one child policy.

Table: Median Age by Country (in years)
Pakistan 21
Cambodia 22
Philippines 23
Bangladesh 25
India 25
Malaysia 26
Indonesia 28
Vietnam 29
Sri Lanka 31
Thailand 33
China 34

After China, India is the most populous nation in the world, and expected to become number 1 in terms of population by 2030. India also has one of the youngest work forces with almost half of the nation being under 25 years old, making the labor abundant and cheap however India has different dynamics in terms of its trade structure. [Read more...]

Filed Under: China, General Business, Global Trade, Shipping Trends, Supply Chain Planning

The Game Changer: China Waterways

July 9, 2012 By Leave a Comment

China’s inland ports create a major advantage during the transition from Coastal China to Inland China. For all of us who are aware of the changes in China for the last 10 years, you know there is a shift from the coastal line of China to the inland.

Currently the land and labor cost is sky rocketing in most, if not all, coastal cities in China. The minimum salary in 2011, in Guangzhou for example, was 40% higher than Wuhan, which is one of the highest inland salaries. If you go to Chengdu (Sichuan), it goes up to 52% and Zhengzhou (Henan) 62 % between Coastal Guangzhou and some inland cities.

Anyone who does business with China knows about Shanghai, Shenzhen, Ningbo, and Guangzhou. However how many of us actually know where Nanjing, Zhangjiagang, Wuhu, Yangzhou are? The first time I was in Chongqing was in 2006, to visit motorcycle exporters there, and during that trip I learned that Chongqing is actually one of the most populated cities in the world with 28 million people (Shanghai is 22 million people).

Now, labor costs and land costs are very important if you have a factory, however, logistics is one of the main components of your cost and your delivery time. There we see another advantage for China against any country in the world geographically, because China has the longest navigable inland waterways.  [Read more...]

Filed Under: China, Global Trade, Shipping Trends, Supply Chain Planning

Why Do The Freight Rates Change so Often?

July 2, 2012 By 6 Comments

If you are an importer and buying from Asia, specifically China, you hear a lot more about Peak Season Surcharge (PSS), General Rate Increase (GRI), Bunker Adjustment Factor (BAF), etc compared to the other countries. Sometimes these constant additions and changes in the market are unclear and do not make much sense to importers. One of the most challenging aspects of importing from Asia is the constant uncertainty of the rates. It is a tedious process as an importer, if you are planning 3 months in advance and having to work out pricing for your customers while keeping in mind the upcoming increases—or better yet not knowing what these increases will be. In this article, with my professional experience I would like to dig deeper and analyze the reasons behind the uncertainty.

Why can’t I have 3 months of valid rates? Is it really good to have rates with that have an extended validity? I have been receiving these similar questions for several years from importers and I have tried to help them understand the bigger picture of the reasons behind the quick and sudden changes in freight rates. If you are a small to medium sized importer and do not have a logistics team–you may find yourself wasting time trying to keep up with the rates instead of promoting your goods to your customers. In order to help you save that time, I hope to clarify these constant and sudden changes.

In my expertise, I composed the following list of the main reasons why rates keep changing: [Read more...]

Filed Under: China, Global Trade, Shipping Trends, Supply Chain Planning, Uncategorized

Doing Business With China

June 18, 2012 By Leave a Comment

My job has taught me that everything starts with numbers. In this case, let’s consider the population of China. Such a massive population of 1.3 billion makes China the world’s largest potential market. Evidently it is their geographic size, which contributes to their potential. The World Trade Organization which was founded to regulate the trade between nations, help producers of goods and services, exporters and importers conduct their business, held their fourth trade policy review just a few days ago. At the delegation in China, Assistant Minister of Commerce Yu Jianhua pointed out that China is one of the biggest influences contributing to stabilizing the world economy and trade. We depend enormously on our relationship with China, which is why it is essential that we conserve it.

Being triumphant takes dedication, hard work and effort. Today, China continues to triumph in aiding the world economy, and stabilizing a firmer market for prosperous profits to follow in the years to come. Some measures taken during this past delegation were to persist in continuous growth , expanding domestic demand and promoting imports and exports. All this would address efforts concerning trade partners. Today’s efforts will be tomorrow’s opportunities. [Read more...]

Filed Under: China, General Business, Global Trade

The Effects of Chinese Consumerism to the Shipping Industry

April 23, 2012 By 1 Comment

It amazes me to see how quickly China changes. On my recent trip to Shanghai I saw this much clearer. In my opinion, very soon China will not only be the largest importer of the world, they will also be the largest consumer. This will have impeccable effects on the shipping industry. The fast growth in consumerism and rising manufacturing prices will be the two key parameters of the increased imports in China. I am not counting the hunger for the natural resources here, as China has already become the biggest buyer of many commodities.

Shanghai is already one of the most expensive housing markets. Luxury car brands are selling the most cars in China, compared to the rest of the world. On the street where my hotel was, there were a lot of high story and shiny shopping malls, all of them are full of people and many new ones were under construction. All luxury shops that you will see in New York, London and Paris are opening one after the other. This change is spectacular, and it made me think what happens when the buying power of the people of China increases? What would the global effect of this increase entail? [Read more...]

Filed Under: China, General Business, Global Trade, Shipping Trends

Current Rate Analysis from China

January 2, 2012 By 1 Comment

After months of hard time for every steamship line in 2011, it seems like a new hope is arising for the carriers again to increase the rates. In terms of volume comparing to past years October 2011 was an extraordinary month. The national holiday of China between October 1 and 7 always brings some down hill effect to China exports. However, space issue to US has occurred much earlier this year during October. Almost every carrier was loading very well right after the long holiday. The situation lasted for days, and gradually slowed down in early November. Although there is slow down in November, the loading volumes were much better than they were comparing to the first half of the year.

 The continuous loss of money in the past months (almost a year) made it  very difficult  for the most of the steamship lines to run the vessel schedules regularly. [Read more...]

Filed Under: China, General Business, Global Authors, Global Trade, Shipping Trends, Supply Chain Planning
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