Karamba
Topic Author
Posts: 7
Joined: Tue Oct 16, 2012 4:12 pm

Cargo To Russia - Best Options?

Tue Oct 16, 2012 4:41 pm

Hi All,

I'm looking for advice on the best way to route 2,000 - 2,500 lbs daily freight from PHL to Russia (DME, SVO).

Over the last two years we have been sending everything via USPS as mail (actually it is a mail - orders from online stores for individuals from Russia), but now we are trying to build up our own route bypassing USPS channel. So far we have identified two options:

1) direct daily Transaero U-2222 (JFK-DME), quoted at $2.2/kg on dim (our dim factor is about 1.7-1.9 to actual weight)

2) daily BA from JFK through LHR, quoted $1.85/kg on dim for 1,000 kg shipments


Since I'm new in that market, I am not able to judge professionally whether it is good or bad pricing. Also, high chances there are could be alternatives of which we are not aware of, like a cheap freighter flying Europe on daily basis. Finally, due to the long term pattern of shipments we are looking for close relationship with airline/forwarder which can commit volumes during peak time and provide bulk discounts.

if somebody here is good at that topic, please share your thoughts and advice
 
alfa164
Posts: 3125
Joined: Sat Oct 06, 2012 2:47 am

RE: Cargo To Russia - Best Options?

Tue Oct 16, 2012 4:47 pm

Did you check DL nonstop JFK-SVO? Or even PHL-JFK-SVO, if you don't want to deliver it to NYC...
I'm going to have a smokin' hot body again!
I have decided to be cremated....
 
Karamba
Topic Author
Posts: 7
Joined: Tue Oct 16, 2012 4:12 pm

RE: Cargo To Russia - Best Options?

Tue Oct 16, 2012 4:57 pm

one more comment/question -

I've studies annual reports for few major airlines and come up with interesting observation. In 2011 the yield per ton on average Transatlantic route was about 2 Euro/kg, which I assume includes fuel surcharge of about $1.

For example, in KLM's report for 2011 the airline reported traffic of 2,246 mil RTK and carried 280,000 ton. It generated revenue of 586m Euro or $2.09 per ton on average route distance of 8,021 km.

in LH report RTK is 4,035 mil, revenue 1,087 m Euro, and carried tons was 578,000, which produce 1.88 Euro/kg.

Does it mean that with actual yield of 2 Euro/kg airlines are selling their cargo capacity to forwarders and the last one resell it about $3/kg ($2 for freight and $1 for FSU)?

[Edited 2012-10-16 09:58:55]
 
PanHAM
Posts: 9731
Joined: Fri May 06, 2005 6:44 pm

RE: Cargo To Russia - Best Options?

Tue Oct 16, 2012 5:07 pm

You should, instead of this forum, consult a freight forwarder with an offic e at DME or SVO whp can also do the customs clearance.

Consolidating the single shipments into one lot for thze main haul is a good idead, but only if you have someone who breaks that down at the destination and cares for the free domicile.

That should be a company with a brojeragte licence and I would suggest the big European freight forwarders, if you want names send me a PM.

Quoting Karamba (Reply 2):
in LH report RTK is 4,035 mil, revenue 1,087 m Euro, and carried tons was 578,000, which produce 1.88 Euro/kg.

nice try but that does not work that way. The overall average rate is never the market rate for a given sector.
Was Erlauben Erdogan!!!
 
Karamba
Topic Author
Posts: 7
Joined: Tue Oct 16, 2012 4:12 pm

RE: Cargo To Russia - Best Options?

Tue Oct 16, 2012 5:17 pm

Quoting PanHAM (Reply 3):
You should, instead of this forum, consult a freight forwarder with an offic e at DME or SVO whp can also do the customs clearance.

yes, these two quotes are from Moscow based forwarder. Also we have JFK forwarder which currently ships our volumes to Berlin. What I don't like with forwarders is that they are not very motivated in providing the cheapest, but most profitable option for them. That is why I'm looking for independent opinion.

additionally, I'm trying to figure out is there any sort of "market" for Transatlantic cargo where major player can be identified and best options explored.
 
PanHAM
Posts: 9731
Joined: Fri May 06, 2005 6:44 pm

RE: Cargo To Russia - Best Options?

Tue Oct 16, 2012 6:22 pm

A freight forwarder gives yo8u an overall services and I caqn only recommend that you do not go for the "cheapest" solution , which can be, at the end of the day, the most expensive one-.

Bear in mind that customs clearance and shipping to domicle to the Russian customers must be part of the deal and you cannot do that.

BTW - you have a relatively interesting load with 1000 kgs per day, but freight forwarders "love" customers who call 50 forwarders to nget the cheapest quotation for theur 45 kilos to somewhere in Europe. Which, considering the time and phone charges, is quite expesnive.

[Edited 2012-10-16 11:24:51]
Was Erlauben Erdogan!!!
 
JRadier
Posts: 3952
Joined: Mon Sep 27, 2004 11:36 pm

RE: Cargo To Russia - Best Options?

Tue Oct 16, 2012 6:29 pm

Quoting PanHAM (Reply 5):
A freight forwarder gives yo8u an overall services and I caqn only recommend that you do not go for the "cheapest" solution , which can be, at the end of the day, the most expensive one-.

Have to agree there! If with the cheapest options you get trouble with delivering to the customer, that will become expensive very fast!

Quoting Karamba (Reply 4):
What I don't like with forwarders is that they are not very motivated in providing the cheapest, but most profitable option for them.

True, but they are competing with each other, so play them!
 
Karamba
Topic Author
Posts: 7
Joined: Tue Oct 16, 2012 4:12 pm

RE: Cargo To Russia - Best Options?

Tue Oct 16, 2012 7:10 pm

Quoting JRadier (Reply 6):
so play them!

yes, we do with some success. but any additional insight will be helpful to estimate their cost base.


btw, we have our own customs broker which does all clearance in DME, so we basically looking for freight rather then full service.
 
User avatar
mayor
Posts: 6218
Joined: Sun Mar 09, 2008 3:58 pm

RE: Cargo To Russia - Best Options?

Tue Oct 16, 2012 7:22 pm

Quoting Karamba (Reply 7):

btw, we have our own customs broker which does all clearance in DME, so we basically looking for freight rather then full service.

So, shipping it to SVO via DL is out of the question?




As an aside, right after the Soviet Union fell and DL got their service to SVO from PA, we had a shipper in SLC that was shipping brand new auto parts to ship to SVO. He was Russian but had lived in Utah for several years. I used to call him a "copulist" because he was a combination of a capitalist and communist and he did care who he was screwing. He used to laugh at that.
"A committee is a group of the unprepared, appointed by the unwilling, to do the unnecessary"----Fred Allen
 
Karamba
Topic Author
Posts: 7
Joined: Tue Oct 16, 2012 4:12 pm

RE: Cargo To Russia - Best Options?

Tue Oct 16, 2012 7:27 pm

Quoting mayor (Reply 8):
So, shipping it to SVO via DL is out of the question?

it is $1.65 actually - just got quote from DL. But the problem is this is a promo rate until end of Oct. Once expired it will get $2.2
 
User avatar
mayor
Posts: 6218
Joined: Sun Mar 09, 2008 3:58 pm

RE: Cargo To Russia - Best Options?

Tue Oct 16, 2012 7:36 pm

Quoting Karamba (Reply 9):
it is $1.65 actually - just got quote from DL. But the problem is this is a promo rate until end of Oct. Once expired it will get $2.2

Does this include any fuel surcharges, or just the base rate?
"A committee is a group of the unprepared, appointed by the unwilling, to do the unnecessary"----Fred Allen
 
YVRLTN
Posts: 2339
Joined: Wed Oct 04, 2006 1:49 pm

RE: Cargo To Russia - Best Options?

Wed Oct 17, 2012 3:03 am

I have an office in both EWR & DME - PM me. There are so many options to Moscow its crazy and prices are pretty fluid. Forwarders often have their own relationships with the airlines and can offer deals you will never get.

Quoting Karamba (Reply 7):
btw, we have our own customs broker which does all clearance in DME,

   Good stuff, you need the solid relationship with a local guy on the ground to "get stuff done" in Russia.
Follow me on twitter for YVR movements @vernonYVR
 
[email protected]
Posts: 151
Joined: Sat Nov 25, 2000 8:10 pm

RE: Cargo To Russia - Best Options?

Wed Oct 17, 2012 4:54 am

Quoting PanHAM (Reply 3):
You should, instead of this forum, consult a freight forwarder with an offic e at DME or SVO whp can also do the customs clearance.

Totally agree, but also check all the local charges... often cheap freight rates get subsidize by higher local charges

Quoting Karamba (Reply 4):
not very motivated in providing the cheapest, but most profitable option for them

well, the reason being in that business (I'm one of them) is to make money, but if you are not competitive you won't get the business ( at least long term), so strange that they don't give you the impression that they are motivated for the best solutions....

The key to every competitive rate is not only the airline, but how the forwarder consolidate the business, e.g. the best rate from a airliner is, lets say 1.5 USD / kg:


- shipment from shipper one
1000 kg with 4 cbm = 664 kg volume weight
- shipment from shipper two
500 kg with 4.5 cbm = 750 kg volume weight

Means he hands over to the airline one shipment 1500 kg / 8.5 cbm / 1416 kg volume, so he pays 2250 USD

even if he would sell net/ net he would collect from the parties who pay the freight
shipment one = 1500 USD (based on 1000 kg)
shipment two = 1125 USD (based in the volume weight of 750 kg because it is higher than the actual one)
Sales = 2625 USD, profit 375 USD.

Means he could even sell below the buying rate, but still making a profit. Many ways to play it, even if consolidation is not suitable there could be a equalization period / or multi master etc.... also depening on the market

For the start I would say asked the medium size and big guys for a quotation, assume nobody has a real daily consolidation, maybe you could use a mix of forwarders or adjust you shipping frequency (e.g. does it really makes sense to ship daily, I don't know if customs works 7 days a week a DME). I would openly discuss your pro and cons with the forwarders, possible they are open to adjust their schedule / frequency for you in order to build up a more regular consol etc....
 
Karamba
Topic Author
Posts: 7
Joined: Tue Oct 16, 2012 4:12 pm

RE: Cargo To Russia - Best Options?

Thu Oct 25, 2012 6:13 am

Quoting [email protected] (Reply 12):
For the start I would say asked the medium size and big guys for a quotation, assume nobody has a real daily consolidation, maybe you could use a mix of forwarders or adjust you shipping frequency (e.g. does it really makes sense to ship daily, I don't know if customs works 7 days a week a DME). I would openly discuss your pro and cons with the forwarders, possible they are open to adjust their schedule / frequency for you in order to build up a more regular consol etc....

thanks for insights, will follow your advice

btw, what are "equalization period" and "multi master"?
 
Karamba
Topic Author
Posts: 7
Joined: Tue Oct 16, 2012 4:12 pm

RE: Cargo To Russia - Best Options?

Thu Oct 25, 2012 6:15 am

Quoting mayor (Reply 10):
Does this include any fuel surcharges, or just the base rate?

it is base, fuel @1.15 is extra

Popular Searches On Airliners.net

Top Photos of Last:   24 Hours  •  48 Hours  •  7 Days  •  30 Days  •  180 Days  •  365 Days  •  All Time

Military Aircraft Every type from fighters to helicopters from air forces around the globe

Classic Airliners Props and jets from the good old days

Flight Decks Views from inside the cockpit

Aircraft Cabins Passenger cabin shots showing seat arrangements as well as cargo aircraft interior

Cargo Aircraft Pictures of great freighter aircraft

Government Aircraft Aircraft flying government officials

Helicopters Our large helicopter section. Both military and civil versions

Blimps / Airships Everything from the Goodyear blimp to the Zeppelin

Night Photos Beautiful shots taken while the sun is below the horizon

Accidents Accident, incident and crash related photos

Air to Air Photos taken by airborne photographers of airborne aircraft

Special Paint Schemes Aircraft painted in beautiful and original liveries

Airport Overviews Airport overviews from the air or ground

Tails and Winglets Tail and Winglet closeups with beautiful airline logos