A mid-size buyer comparing two Egyptian offers on FOB price alone is comparing about sixty percent of the picture. On a part-load the proportion is worse, because the fixed costs of moving a container get divided across fewer cartons. Two suppliers can quote the same FOB and land four figures apart. Here is every line that sits in between.
Origin side
FOB Alexandria, Damietta or Sokhna already includes the fruit, the packing material, the packhouse labour, inland trucking to the port, terminal handling at origin, customs clearance at origin and the phytosanitary and origin certificates. What it does not include, and what varies between suppliers, is pallet cost, own-brand carton cost if you want your label on it, pre-shipment inspection if you appoint SGS or Intertek, and temperature loggers.
Those four items are small individually and add up. Ask for them itemised rather than folded into a headline price, so you can see which supplier is actually cheaper. Our guide to reading an Egyptian produce quotation covers what each line should tell you.
Ocean side
Freight itself is the ocean rate for the box, plus the bunker surcharge and any currency adjustment factor the line applies on your lane. On a reefer there is also a plug or genset charge. Rates move week to week, so a quotation more than about ten days old should be reconfirmed before you commit.
On a part-load or groupage shipment you are buying a share of the box rather than the box, so the freight arrives as a per-pallet or per-cubic-metre figure. That figure carries the consolidator’s margin and their assumption about how full the container will be. If the container ships underfilled, some consolidators pass that through. Ask whether the rate is firm or subject to fill.
Destination side
Terminal handling at destination, customs clearance, import duty and VAT, plant health inspection where the destination requires it, delivery order fees, and inland trucking from port to your warehouse. Duty depends on the HS code and any preferential agreement between Egypt and your country, and it is worth confirming the code before the shipment rather than after.
Then the two lines that catch people out. Demurrage starts when free time on the container expires at the port. Detention starts when free time on the equipment expires after you take it away. Free time is typically a handful of days and it is negotiable at booking, not afterwards. On a reefer the daily charge is materially higher than on a dry box because the plug keeps running.
Doing the arithmetic
Take every cost above, total it, and divide by the number of saleable cartons rather than the number of cartons shipped. Saleable is the important word. Apply a realistic allowance for arrival losses based on the product and the transit length, because a cost per carton calculated on shipped quantity flatters every shipment you will ever do.
On a mixed load, allocate the shared costs by pallet space rather than by value. Freight does not care what is inside the carton. Allocating by invoice value quietly makes your expensive products look worse and your cheap ones look better than they are.
Where part-load buyers lose money
Three places, consistently. Underestimating the fixed destination charges that do not shrink with volume. Ignoring free time until the demurrage invoice arrives. And treating shrinkage as an exception rather than a budget line, which it is. Setting a realistic sell-through window against product shelf life helps on the third point, and our note on shelf life by product on mixed loads gives the working figures.
Payment structure also has a real cost. A letter of credit carries bank charges on both sides and ties up a facility. A telegraphic transfer is cheaper but shifts risk. Which one makes sense depends on the relationship and the order size, and we set out the trade-offs in our note on payment terms for Egyptian produce orders.
What to ask for
Request the quotation on your preferred Incoterm rather than converting it yourself. CFR and CIF move the ocean leg to the supplier’s account and make comparison easier. DAP moves almost everything and is the cleanest number to compare against your local wholesale price, though it is not always available on every lane. Whichever you choose, name the Incoterms 2020 rule and the named place in full on the contract.
For an itemised quotation on your product mix, a firm CFR or DAP number to your port, or help modelling a landed cost before you commit, message Peivana on WhatsApp at +20 10 9911 1918. Same-day quotes on mixed and part-load enquiries.