Wednesday, August 12, 2009

Sending parcels to and from Cambodia

I am sorry for not updating the blog. My partner Alan is finally back from Scotland so I feel settled now. We are taking walks and playing with the dogs again. We are also experimenting with bamboo - if we succeed I will share with readers!

I have also been busy with a diaper bag someone in the US wants us to make. I've never been a mommy so don't know what to look for in a good diaper bag. We have made one according to specs emailed to us and our customer L says it looks great. L is so committed to the environment she is sourcing for recycled straps and other things we can use to make the bag 100% (or as close to 100%) recycled.

She also sent us a sample from the US which was due to arrive at our shop in the Russian Market on Sunday but it still has not appeared. The tracker says it is in Phnom Penh...somewhere. I really hope we get it.

One time a customer from the UK sent us some ribbons she had ordered from a supplier in China. The package was sent through an agent in China and arrived in Phnom Penh. Unfortunately it was stuck in customs.

First I went to the airport in Phnom Penh. I was told to go to the big building beside it, which says customs or something. That building is a large warehouse, where all sorts of things are sent to Phnom Penh by air and duty has to be paid.

There, I was ushered to an office where people sat waiting to talk to officials behind desks. I had to fill in some paperwork signing when the stuff arrived, a description and how much it is worth. From there I was told to go to another customs office in Phnom Penh city to get a stamp or signature (I can't remember as this happened last year - I should have written about it then but my customer and me were too upset by the whole incident). Then I was to bring that form back to pay up and collect the ribbons.

I cannot remember how much I was supposed to pay for customs to release the ribbons but it was far more than what the ribbons were worth. I even got two delivery agents involved, one a very large MNC to assist us, thinking personal relationships might save the day. But no go - it was still a few hundred dollars they wanted.

In the end, we had to make the products for our customer without the ribbons. It was a good lesson.

For me, this is the reason I do not use specially imported stuff in making our bags. I just cannot be assured the stuff will get to us. While almost everything used to make a Bloom bag is imported from Vietnam (nylon straps, zips, zipper pulls, buckles, D-rings, clasps - all these are imported since Cambodia makes very little of its own), we buy them from retailers at Orussey market in Phnom Penh. YKK zips we have to order from its representative in Cambodia as YKK does not sell through retailers.

I was advised by the MNC delivery company that in the future, they should be alerted before the delivery package leaves the country of origin for arrival in Cambodia. This way, they will be able to work with the agent in the first country and customs in Cambodia so the package will arrive to us safely. Once it has arrived in Cambodia, it is too late, and we have no leverage in getting our goods out.

It seems like so much trouble for so little. At the same time, if we do not import materials, we are limited by what is available in Cambodia, and the quality of the materials imported from Vietnam is shall we say, not the best.

The other problem is the Cambodian retailers buy, I suspect, whatever is cheap. What this means is the designs of the buckle, clasps, zipper pulls etc change from month to month. We are not guaranteed the same design, because it depends what the retailers get from Vietnam.

For instance, we used to buy zipper pulls that were a fat teardrop shape and of good quality. But this is now not available. It is hard to believe the Vietnam factory has stopped making that design, which is why I suspect it is the retailers who are always on the lookout for cheaper stuff. In this case, we have to substitute the teardrop one with a leaf shaped one or the ordinary flat, oval one - same price but of lower quality. Very frustrating, especially if we have an order where the customer expects us to make the same products as per the sample.

The other big problem working in Cambodia is the expensive delivery costs from Cambodia and people can see for themselves delivery costs on Cambodia's Express Mail Service website: www.ems.com.kh.

One kg to the US costs USD45 which is comparable to Singapore where it costs SGD64 (around USD44) but much more expensive than Thailand's EMS (calculate the rate here. From Thailand it costs USD35.55 to send a 1 kg parcel to the US, or about 30% less than to send from Cambodia.

Most of our bags are priced under USD20 which is a problem when the courier costs as much as the bags themselves (1 kg of bags could be between 2 to 8 bags, depending on the design). It is something I have to take into account when designing our e-commerce site.

As for shipping costs, they are more expensive than courier costs, because there are all sorts of paperwork and taxes to pay. Even the shipping company advises us to just use courier because shipping is only cost-effective when you are sending big items or a lot of them. Shipping companies charge per cubic metre, and costs go down per cubic metre when you ship a lot. Even sending a thousand bags to Europe by air cost me less than it would by ship. Go figure.

A final note on the postal service in Cambodia. In 2006 my dad sent me a postcard from Singapore which never got to me. When he came to Phnom Penh a couple of months later for a visit (we were living in Phnom Penh then) dad actually went to the central post office near Wat Phnom to ask about his postcard. The postmaster there gave him the mobile number of the postman who was responsible for deliveries in our area (BKK3) but of course we never found the postcard. Still, I was impressed. Where in the world would you get the mobile phone number of your postal delivery guy?

1 comment:

ry's said...

hi just read your article and was wondering when you send out your recycle bags out to another country do you have to pay a high tariff on your bags??

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