“It needs to be there yesterday!” “But what about our logistics budget?!” “What about item restrictions?”
For businesses newer to cross-border shipping, these questions may seem familiar when it comes to shipments that are larger than direct-to-consumer parcels. While there isn’t a magic bullet that can do everything at once, knowing your shipment requirements and what your shipment can’t afford to compromise on can help you decide which transport mode suits your current shipment best.
In a previous article, we wrote on when should you use cross-border trucking, this one will serve as a cheat sheet for when you need to decide between air and sea freight for your next major international shipment in Southeast Asia. The infographic below shows a quick comparison between air freight, sea freight and cross-border trucking in Southeast Asia:
Before we continue though, it’s important to note that Southeast Asia’s geography also plays a big role in deciding which freight mode you should consider. As opposed to landlocked countries, like those central Europe, Southeast Asia has most of its major trading hubs – such as Singapore, Klang, Jakarta, Manila – easily reachable by sea freight.
This is because these trading hubs are comparatively close to each other when compared to the likes of US to China sea freight. This means that if in any cases air freight is unavailable as a freight option, sea freight isn’t too bad an alternative when it comes to speed.
Air freight is fast, but could be harder to use in terms of items that can be easily shipped and has higher rates than sea freight.
The number one reason to use air freight is its speed, and even more so for deliveries across oceans within Southeast Asia. Building on the information that Southeast Asian (SEA) countries aren’t too far from each other, the actual flights themselves between most SEA countries will take about a day at most. This doesn’t take into account the other legs of the journey, however, such as vans or trucks for pick up and last mile or customs clearance.
But for all this speed, you’ll need to be prepared to pay higher rates relative to sea freight. Air freight rates are usually calculated using the higher of actual weight or volumetric weight. Volumetric weight refers to how much space the shipment takes up and is also known as dimensional weight. If you’re shipping with Janio, the following calculation is used to find chargeable weight:
Length (in cm) x height (in cm) x width (in cm)/ 5000 = Volumetric weight in kgs rounded up to nearest 0.5kg
Sea freight saves you money if your order is larger than 2 cbm. However, you don’t get those economies of scale for items that aren’t that big like small cartons that take up between 0.5 to 0.9 cbm as you’ll end up paying for unused space. This is where air freight can be more economical than sea freight.
Sea freight would be a better option for larger shipments that can afford a longer lead time. Air freight works best for smaller shipments that need to get there fast and have a high enough value to cover the cost of shipping.
When it comes to larger shipments, such as those that need pallets, or certain items deemed by IATA (International Air Transport Association) regulations to be dangerous goods, air freight could be slightly harder to use than sea freight.
For one, the maximum height of shipments you can put on planes would be 1.6 metres on average, while a Twenty-Foot Equivalent Unit (TEU) container allows for around 2.4 metre tall items to be shipped.
Shipments via air freight need to abide by IATA dangerous goods regulations. This would involve special packaging, labelling and handling and would also require additional documentation like Material Safety Data Sheets (MSDS).
According to IATA, the sorts of products deemed dangerous include:
To find out more about these, you can check out a chapter on IATA Dangerous Goods Regulations on ASEAN.org.
While it may look like most consumer goods that are normally shipped don’t fall under these categories, health and beauty products can contain gases (like aerosol) or flammable liquids. Similar to the earlier examples, items containing batteries like smartphones or other consumer electronics also need to adhere to IATA’s safety regulations.
Air freight works well when your shipment needs to be there fast. This could be for new product launches that need to meet tight deadlines, or eCommerce deliveries to your customers around Southeast Asia. However, you’ll need to watch your budget – check if your shipment value and time-sensitivity are enough to justify air freight’s higher rates.
If you need help with any air freight shipments to and throughout Southeast Asia, Janio can help you from planning to delivery:
Sea freight is all about economies of scale. Higher capacity, lower cost per kilogram. However, what you gain in cost-effectiveness will cost you in speed.
When it comes to sea freight costing, the calculation for shipping rates depends on whether you’re shipping via LCL (less-than-container load) or FCL (full container load).
LCL shipments are usually charged by volumetric weight unless the actual weight is heavier. As we noted above, sea freight will save you money compared to air freight if your order is larger than 2 cbm.
FCL shipments involve renting the whole container and tends to be a flat fee regardless of how much space is taken up in the container. Above a certain weight and size, it stops being economical to pay for a large LCL shipment, with FCL saving you more on cost per volume shipped. Freight rates tend to change, and if you’re working with a shipping partner they will inform you whether your shipment can optimised costs via LCL or FCL.
As for speed, when compared to air freight, it will take a few more days to sail from country to the next, not counting pick ups, last mile deliveries and customs clearance.
LCL shipments need to share a container with other shipments, the time it takes to consolidate these shipments should also be taken into consideration. FCL shipments don’t need consolidation and could be slightly faster than LCL shipments because of that.
While sea freight also needs to abide by safety standards for items that are being shipped, these standards are not as strict as air freight’s. This means that items that contain liquids, gases or batteries will have an easier time being loaded on a ship than they will getting uplifted onto a plane.
As noted above, the standard Twenty-foot Equivalent Unit containers used for sea freight can also take on taller loads compared to air freight.
Deadline requirements and budget concerns can be tough to balance in supply chains, but knowing how and when you can use air and sea freight to help you out can go a long way. Looking for either air freight or sea freight services to and throughout Southeast Asia with local expertise and customs clearance experience? Contact us below to find out more or to request a quote:
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