Kopi Luwak - Goods to Be Transported Internationally - Example

Task 1 Report PART ONE GOODS TO BE TRANSPORTED INTERNATIONALLY 1.1. KOPI LUWAK COFFEE Kopi luwak is the world’s most expensive coffee. The main factor of its high price is the uncommon method of producing such a coffee. It has been produced from the coffee beans which have been digested by a certain Indonesian cat-like animal called then palm civet or also civet cat. This is the reason kopi luwak is also called cat poop coffee or civet cat coffee. The feces of this cat are collected, finished and sold as kopi luwak. The kopi luwak coffee has a unique properties and taste. The short supply, in comparison with the high demand, the different taste and the uncommon production methods define the value of kopi luwak – the most expensive coffee in the world. We export 1200kg of Kopi luwak coffee from Bali Indonesia. Coffee bean price 120 USD/kg packing in 250g aluminum foil doesn’t include delivery charge 1.2 Quick Details Type: whole bean coffee Coffee bean: Arabica Roast type: High roast Taste: bitter Packaging: bulk Features: Caffeinated Certification: GMP Grade: 3 Brix (%) 80 Max Moisture (%): 8 Weight: 1kg Place of origin: Indonesia Brand name: Sumatera Coffee Luwak Model number:1 Sumatera Coffee AUD $1045 1.3 Packaging and delivery: 2 weeks PART TWO METHOD OF TRANSPORT 2.1 SEA FREIGHT There are a several types of containers, but nowadays they have stable measurements. We will use 20” gp Container refrigerated what is very good for stabilizing coffee temperature and will protect the beans. We choose shipping cargo instead of air freight. For coffee beans is good to use Dry container and send it by sea cargo. 2.2 OOCL’s Reefer Equipment: Designed for the Best Reefer, the generic name for a temperature controlled container is an insulated container which allows circulation of temperature controlled air within it. OOCL has a fleet of over 25,000 reefers, including 20 feet standard and 40 feet high cube reefers. Each reefer has undergone stringent testing and meets the following standards: •   Stainless Steel design  Stainless steel external panels. Also, stainless steel internal corrugated side linings for better air circulation and larger payload. •   Bottom-air delivery  Cool air circulation to absorb heat given off by commodities. •   Microprocessor and data logger  Advanced and state-of-the-art algorithm to regulate air temperature. Robust data logger to record temperature in entire shipment. •   Generator Set (Genset)  Genset can provide electrical power supply to the reefer to maintain set temperature, so as to reach the furthest inland locations. Both chassis-mounted gensets and clip-on type gensets (i.e. mounted onto the reefers) are available. •   CFC-free  Refrigerants installed in all OOCL’s reefers are CFC-free. PART THREE PACKAGING AND STOWAGE REQUIREMENTS 3.1 LABELS In our case we will use all of these labels for our shipment with Coffee Luwak beans because its perishable, the heat does change a quality of coffee, the packaging is in boxes but when the coffee bean bag is damaged and will absorb air the beans will be damaged. The coffee price is very high and we want to export our boxes with coffee beans safe. 3.2 Boxes: Carton size: L30 x W45 x H30 Gross weight of carton: 12kg Freight volume: 0,04 m3 We will need to load 100 cartoons of coffee Luwak beans. One container is able to load approximately 637 - 665 cartoons. PART FOUR COSTS FOR INTERNATIONAL TRANSPORTATION A successful and ongoing export business calls for right pricing and quotations for ones goods or services. Charges for goods or services are affected by a number of factors; different market conditions abroad, difference in quoting formats and currency difference as well as difference in costs. These factors also cause difference in domestic and export pricing. Before reaching out on an overseas market, determining the price is important since many contacts overseas need to know the price. Clarity on export costs is vital for determination of prices on goods. Returns on export sales depends upon the difference between the costs and the price charged on the goods. Before adding duties, shipping costs among other costs, export costs should be factored in first on cost recovery in setting prices for goods. These costs may include; Research costs on international market Travel costs for overseas markets Communications costs across international market Export graphics and translations costs. Modification costs for transportation of goods Cost for packing and labels on goods Overseas costs for standards compliance as well as promotion costs. For export, we consider the following transportation costs 4.1. Ex-factory shipping to departure port; These costs include transportation from production cite to the port. The most suitable transport means will be a truck. 4.2. Insurance and sea freight costs Indonesia being class B, The rate ranges between 16.30 AUD/Kg and 18.30 AUD/Kg. Transporting 1200 Kg will cost between; 16.30 X 1200 = 19560 AUD and 18.30 X 1200 = 21960 AUD Other costs These costs may vary by destination Fuel surcharge; Dry Ice surcharge of 5.5 AUD per shipment Special handling fees; Declared value charge for carriage - $ 50,000.00 International Priority Direct Distribution Freight - $ 100,000.00 Ref: Australia Export Shipment Rates 2015. For International Priority Direct Distribution. And For International Economy Direct Distribution Insurance cost. A cover for damages to third parties and goods while transporting. These includes; 1. Insurance cover for marine cargo. This provides security for goods in transit by land air and sea. 2. Insurance cover for pleasure craft. This provides security on damage and accidental loss as well as third party liability while sailing in Australian waters. These covers are offered by QBE Marine Insurance. This insurer provides cover for which has served the industry as a specialist marine insurer providing insurance protection for over 100 years on marine liability, specialized cargo, and pleasure craft. 4.3. Taxes Export duty Compliance with government sanctions and regulations where exporters pay export duties and taxes to the government. Australia sanctions Indonesia and other countries according to the United Nations Security Council. According to these sanctions organizations and individuals in Australia are required to conform to several measures. These sanctions also apply to Australians abroad. 4.4. Clearance on custom duty Different Customs clearance fee apply to different companies. For custom clearance the following documents are needed; Packaging list, Sales Invoice, Buyer’s Purchase order, Shipping bill and other documents required by financial institutions or as per regulations by the importing country. 4.5. Cost of transport from port to importer These will include costs of truck used to transport the coffee container from port to importer’s desired destination. All manpower needed in the transportation process as well as inspection and unpacking costs. 4.6. Warehouse Charges These costs will be covered if goods are not directly delivered to the customers in which case we shall need a distribution point in form of a warehouse. The warehouse cost may vary as per the condition and space required as well as location. 4.7. Agents commission Distribution agencies payment requirements for movement of coffee from warehouse to customers. This cost also may vary depending on quantity sold and customer coverage distance from the warehouse. I also may vary from agent to agent in Indonesia. References 1. Australia Export Shipment Rates 2015 for International Priority Direct Distribution. 2. Australia Export Shipment Rates 2015 for International Economy Direct Distribution 3. Export pricing and quotations – Austrade 4. Pricing updates – Australia post 5. Freight Rates and Shipping Surcharges | FedEx 6. GST and international freight transport Read More