Anyone who has attempted to ship an item abroad, from small items such as books, card games and customized poker sets to larger items such as tables, clay artworks or even basic materials like aluminium or plastic will have noticed either or both of the following. It’s not cheap and discounts are few and far between, or it’s very time consuming and the system is geared for large retailers or wholesalers.

As an individual attempting to ship a small item one-off, you have little option but to use one of the large courier/trading companies. This is generally very expensive. Personally, I have been quoted over $90 for a 1.5kg package to be shipped from China to a UK address from one of the large suppliers. These services are not cheap but generally very high quality offering both speed and peace of mind (via means such as personalized tracking codes and bespoke online solutions). In terms of speed, deliveries by air freight take around 3-4 days and can be door to door depending on the customized nature of the shipping service. As an individual shipping a small item, this is often your best bet. Larger items such as tables or clay artworks can often be shipped by sea freight. Generally you buy a metre cubed container and this can be very cheap (around $40) but takes a long time to reach its destination (up to 6 weeks).

If you operate a firm that regularly trades overseas, you will no doubt hold a business account with a large shipping company. These accounts offer you discounts dependent on the volumes of orders placed on an historic basis. Setting up an account requires you as a firm to demonstrate a minimum credit quality rating and trading history to the shipping company, who often use independent credit quality rating agencies to assess your circumstances and needs. An account holder is usually offered discounts immediately on the prices available to non-account holders. The large shipping company’s are setup to take care of all your shipping needs and provide a customized shipping solution for your business to allow you to get on with what you do best.

Setting up an account is by no means easy and it often takes time for the shipping company to calculate a customized solution. Some of the largest shippers offer consolidation services whereby smaller orders are grouped into a larger shipping package. This increases the overall consignment weight and hence reduces costs as discounts are applied. Upon arrival in the destination country, the individual smaller units and be separately distributed to their individual destinations.

For firms that hold inventories of stock and haven’t tight delivery deadlines, massive discounts can be found by using sea freight shipping. The declining cost of sea freight is often argued as one of the drivers behind globalisation and the rapid economic integration of economies across the globe, although other major factors such as comparative advantage tend to dominate the debate. For more information concerning trade theory, my advice is to familiarise yourself with the Hecksher-Ohlin model of trade integration.

In summary, customized shipping solutions are not easy to find and set up, but are well worth the effort.