Sea Freight or Air Freight?

Posted by on 15 November 2016 | Comments

 

We know that it can be tricky to decide what is the most suitable option for you without experts’ advice. There are few considerations you need to bear in mind before making your choice: seasonality, stock strategy, speed of market…

We can guide you and help you decide your best bet. Do you need bespoke shipping solutions?

Get in touch with our freight specialists at or call us on +44(0)20 8988 8084.

 

How to choose your mode of transport shipments

Although this is not an instant decision that can be made, we can give you 4 general but important factors to take into account.

1. The cost of transport

Sea freight is unquestionably the first choice for shippers who want a more cost effective option thanks to containerisation. In fact, sea freight costs are often calculated per container of 20ft or 40ft. Moreover, Sea freight has recently reached cheaper rates than ever. Learn more about container specifications.

On the other hand, Air Freight charges are based on the size of the goods as well as its weight because of the limited space on the aircraft.

If you need to ship heavy or massive goods, air freight will cost you more than sea freight.

With smaller goods the prices between sea freight and air freight are closer and air freight can become more attractive.

You can receive a free online quote here  >>

 

Note that Duty & VAT are higher when importing via Air. If you are VAT registered and can re-claim VAT, paying more Duty and VAT would not be a problem. However, if you are not VAT registered, a higher VAT can significantly impact your financial outcomes (VAT represents 20% of the shipping costs plus the value of goods plus the Duty).

 

Comparison of Sea freight and Air freight Duty and VAT costs for the same product:

 

 Sea Freight

 Air Freight

 Goods : £5000

Goods : £5000

 Freight : £310

Freight : £1200

 UK Duty : (6.5% of £5310) = £345

UK Duty : (6.5% of £6120) = £403

 Import VAT :

 20% of (£5000 + £310 + £345)

 = 20% of £5655

 = £1131

Import VAT :

20% of (£5000 + £1200 + £403)

= 20% of £6603

= £1321

 TOTAL DUTY & VAT : £1476

TOTAL DUTY & VAT : £1724

 

2. Speed needed

In a fast growing market, a fast shipping transit is decisive. Air freight is the quickest mode of transport thanks to direct inter-continental travels.

For instance, at Cargocost we offer daily, direct flights to Shanghai and to most destinations worldwide. Air Freight transit times to Shanghai can take less than 10 days compared to Sea Freight which can last up to 35 days, depending on the route.

Discover more about our air freight services: http://www.cargocost.com/import/air-freight-service/

 

3. Environmental impact

Sea freight represents 3% of the world greenhouse gas emissions but air freight emits 545g of CO2 per tonne shipped for one km compared to 15g for sea freight.

 

4. Capacity

      Vessel can carry in one shipment every kind of goods regardless its shape and easily serve a large demand.

Unlike vessels, the capacity of aircrafts is quite limited and therefore, loading goods on aircrafts becomes sometimes extremely competitive. A spot in a plane can be quite expensive, for example, when the new iPad was launched, air freight prices increased by 20% because of a too large demand.

 

If you need further advice, feel free to contact our freight specialists at Help@cargocost.com or call us on +44 (0)20 8988 8084.

For an instant comparison, get a free online quotation:

                Sea Freight                                   Air Freight

          LCL Sea Freight                       Air freight