The Complete Guide to Air Freight vs Sea Freight from China

Total landed cost is the only number that matters when comparing Chinese suppliers. It includes: factory price, inland freight to port, export customs fees, ocean/air freight, insurance, import duties, VAT, customs brokerage, and inland freight from destination port. A $10 product FOB can easily become $14-16 landed. Most first-time importers forget at least three cost components and end up with negative margins.

Payment terms follow a standard progression in China. Transaction 1: 30% deposit, 70% before shipment. Transaction 2-3: 30% deposit, 70% against B/L copy. After 1 year: possible 30% deposit, 70% 30 days after B/L date. L/C at sight is standard for large transactions. Never jump ahead in this progression — let the track record justify each step. Trust is earned through consistent performance.

Quality control should not be a single inspection at the end. Build a multi-point QC plan: (1) raw material inspection before production starts, (2) first article inspection when the first unit comes off the line, (3) in-process inspection at 30% and 60% completion, (4) pre-shipment inspection when 80% is packed, (5) container loading supervision. Each step costs a fraction of catching defects at the destination.