Importing 250kltons of Road Salt??

[Lagron]

Hello everyone, I have just joined these forums a few days ago, and read quite a lot in regards to importing and exporting for items on ebay and the likes of such.

I must say this forum has been really really beneficial to myself and wish I came across it earlier.

It has been 2-3 days since I joined, read a lot of posts, and started taking action, I want to be that* guy that imports and exports unbelievable amounts of products to and from the USA while raking in soo much money.

So here is my question/request for some help...

I have to submit a price for 250 tons of salt, I have found a number of suppliers and forwarders to help in the process of meeting the needs of a municipality in California.


Here is what I have received as the lowest price for the product so far and am wondering if I am breaking this down correctly.

[FONT=times new roman]Dear Lagron,[/FONT]

  
 [FONT=times new roman]Thank you for your inquiry.[/FONT]

  
 [FONT=times new roman]We have given our latest price below.Should you have any questions,you could always reach us.We shall be pleased to assist.[/FONT]

  
 [FONT=times new roman]Road salt :US$153/MT CIF OAKLAND[/FONT]

  
 [FONT=times new roman]Packing: 25kg/bag or 1000kg/bag. 25MT/20'FCL[/FONT]

  

 [FONT=times new roman]Payment terms:T/T(30% down payment,70% against copy of B/L)[/FONT]

  

 [FONT=times new roman]Lead time:Within 7 days after down payment.[/FONT]

  
 [FONT=times new roman]Your early reply will be highly appreciated.[/FONT]

So can someone please help me evaluate this?

It would be $ 153 USD per ton, so 250 tons at $153 = $38,250 USD.
I needed it shipped to the port of Oakland California, (closest port to the clients storage units).

CIF, is what gets to me though... CIF as I understand it means, the price is for the Cost, Insurance and Freight correct? I also asked for an update because I wanted them to be the ones to to ship it from the port to my Client as opposed to myself hiring another party in the transaction.

Road salt is: the salt trucks would throw onto the ground when it is snowing, for those that did not know, and is also the product I am importing. Packaging is going to 1000 kg/bag, but the bag part gets to me...I mean, does this now mean, I need to literally hire more people to rip out the bags and then finally dump it under the roof of the lot of the client? Or are they used to receiving things in bags, so it would be fine?

What is the 25MT/20'FCL after the "packing portion" of her message? I think she kind of picked up that I was knew to this all and even freely gave me some terms such as DDP (delivered-duty paid) she mentioned DDU but I didn't ask what that was, so as to hide how I'm new to trading.

She offered the best customer support I would say, and for now, also the cheapest quote I have gotten. And ..."Do you have skype? (i replied no, but it seems I should probably get it)... "We can call through skype, and then I can even hear your charming voice"... haha. She does have a sense of humor I would say.

Regardless...
T/T(30% down payment,70% against copy of B/L) = Electronic Wire Transfer with 30% down payment, and then 70% against copy of B/L, what is B/L? Bill of Lading? or Bill of Landing? I get this term a lot from suppliers and want some more clarification as to how this would work, if anyone would be so kind as to help me for a moment.

And now here comes the more interesting question... I will be submiting my price of the 250 tons of Road Salt to the municipality but how do people come up with what they want their profit margin to be, and to also be the lowest bidder so as to actually be awarded the manciple contract. I read/looked around and found that 10% is usually the rate of importers/agents/exporters, (I'm not even sure what I am doing is called? Import Agent? Broker?)

I just want to
1. Find a buyer of a product.
2. Bid to supply the product.
3. Get paid a portion to supply the product that I would use as a payment to the supplier, that I would find.
4. Arrange shipping/have the supplier include it in their price.
5. And collect final payment, upon which I would take the proceeds of 10%? 5%? (What is a good rate?)
6. Repeat the process, until I am a regular supplier for companies in the USA.

From this sale, my profit would be $ 3,825 :coolgleamA: (If its a 10% added margin to the total price of supplying/shipping), (all within 24 hours time span). This is what I used to make as a quality assurance tester at a software company, for 1 and 1/2 months (WOW WAS I BEING DUPED, working that long for dirt earnings).

Total contract $ 42,075.00 to be submitted, should I go ahead and "do it" or do I need to reevaluate what I am doing because I am missing something?

Please evaluate and suggest/critique/ say anything that comes to mind in regards to this/answer some of the questions posed.

Thank you once again for your time and help.
From Lagron.

 

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[Lagron]

Okay I will just put in the quote.

Hope I win the bid!

Thanks for the help.

 

[LightHouse]

What terms does your client have? you are going to have to float the cash for the product until you get paid. Also you are going to want to evaluate the price you are getting and the product.

If anything, since you already submitted, if you win, you are going to have a great learning experience one way or another.

Is this a private bid or an open bid/fbo?

 

[Lagron]

Its public sealed bids. Terms are 20% first payment of being awarded the contract, not to exceed $20k. Then the rest 30 days after full delivery.

I have the funds to fund it, just hope I'm awarded the contract, it'll put more confidence in myself when it comes to doing what U haven't done before.

Thank you on the information and reply & you are certainly correct, I have learned quite a number of new things and I've only been looking for suppliers and forwarders less than 3 days now.

I'll post back on the results of the bid.


Sent from my iPhone using Tapatalk

 

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[InMotion]

I have experience in low bidder environments...these can be tough the first go around because sometimes you have no baseline for your bid. Today, I can bid a project because I know about what the competition will throw in and what the margins are.

If I was just starting out I could approach this several ways. You can simply quote it with the price you feel allows you a comfortable margin...what good is cutting your own throat. I am sure that this will not be the last bid done for road salt by a municipality, so if you do lose this bid you need to go over what the winning bid was after the contract is awarded. This will give you a future baseline and let you know if you need to find a cheaper supplier etc.

However, someone might be able to tell you what the last contract awarded was so you have that baseline now.

You could go lowball bid on the first one to get your foot in the door; there is a learning curve to not losing your a$$...this strategy may or may not help you if the next season, or contract, is for low bid again...in some environments it is beneficial to get a contract awarded because that may bring you future non bid business, other times they simply don't care, they want the lowest price every time from whoever.

The bag thing...usually this is found in the specifications or in the scope etc. If not, there should be contact info for the person handling this and just ask them. Can they take bagged or does it have to be bulk etc.?

This is probably worth its weight in salt ....so do your due diligence for your own situation of course.

 

[Lagron]

I have helped run a construction company and we would always be bidding and be selected on the lowest bidder or most "trusted" supplier basis.

I have never bid/worked with minerals or anything of the likes of importing products from China. I have looked into previous orders for Rock Salt shipments, and before sending my quote I had it revised to accommodate "bulk" shipping which was what was required according to the bidding documentation.

I have to just wait now for 5 more days until results are given. If I get the sale, PERFECT! If not, as you said, what you said, and what I am learning from this process is worth its weight in salt (I like how you came up with that last sentence).

---
What I would have loved to ship around is orders of hmmm 50k tons and large quantities such as this, as I notice there are much much greater profits from purchases this large.

You said you have had experience with these types of processes, any/all information you think would be relevant is always welcome, or perhaps a link to some things you deem beneficial for this.

I am really excited and already looking to bid on other similar requests, my main issue is that I need to register/receive licensing to be able to bid in different states, would love to figure out how I can overcome this issue.

Thanks for your time and reading.

 

[Rsimmons016]

Hey Lagron,

Did you win the bid?? I work in the forwarding industry. If you need help calculating your landed costs, incoterms (CIF, DDP, DDU, etc.), or anything else related to shipping and customs clearance let me know

 

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[Lagron]

Unfortunately for me I did not win the bid. It was submitted to California, El Dorado for use on their highways.

My price was quite high tbh. It seems according to competitor prices at 60-100 $ a ton, I can't compete importing from China at 125$ a ton. I did receive a quote at 30$ after shipping, customs and everything else to that extent and a small profit for myself it I would have sold at 55$ a ton from a supplier and even chose him to supply me with the needed road salt.

My issue was that the company was from Egypt... when I received a formal contract. It would have taken 2x as long to get the road salt from Egypt to the ports of California, when it would have taken much shorter time to get it from China to California. Part of the shipment of goods were due 2 weeks after a acceptance of bid.

I lost : / easy-office-work income- because I had to go with a supplier that charged more for the salt I needed.

BUT I now have a supplier for rock salt! Currently looking for FRQ's that would require goods just long enough ahead of time that I can submit bids, be accepted & still have time to ship the goods to the buyers warehouse & collect.

I found it can be extremely annoying with the time zone differences. I stayed up all night looking for suppliers in China and all of them said something along the lines of 'shouldn't you be asleep now, you seem very dedicated to your work.'

(No duhhhh, you guys are sleeping!! When I need to get a hold of you!!!!)

It was interesting to see how this would all work, but now feel demotivated from this sort of business somewhat for my first attempt and failure.

I am currently working on another business That I am posting about on these forums and that is going well it seems.

I am definitely always still in the search of RFP's for rock salt...and some other minerals I see being much more profitable and less seasonal.

RSimmons, send me a pm with your contact info and if anything comes up Ill have you to look into.

Thanks.

 

[Rsimmons016]

Unfortunately for me I did not win the bid. It was submitted to California, El Dorado for use on their highways.

My price was quite high tbh. It seems according to competitor prices at 60-100 $ a ton, I can't compete importing from China at 125$ a ton. I did receive a quote at 30$ after shipping, customs and everything else to that extent and a small profit for myself it I would have sold at 55$ a ton from a supplier and even chose him to supply me with the needed road salt.

My issue was that the company was from Egypt... when I received a formal contract. It would have taken 2x as long to get the road salt from Egypt to the ports of California, when it would have taken much shorter time to get it from China to California. Part of the shipment of goods were due 2 weeks after a acceptance of bid.

I lost : / easy-office-work income- because I had to go with a supplier that charged more for the salt I needed.

BUT I now have a supplier for rock salt! Currently looking for FRQ's that would require goods just long enough ahead of time that I can submit bids, be accepted & still have time to ship the goods to the buyers warehouse & collect.

I found it can be extremely annoying with the time zone differences. I stayed up all night looking for suppliers in China and all of them said something along the lines of 'shouldn't you be asleep now, you seem very dedicated to your work.'

(No duhhhh, you guys are sleeping!! When I need to get a hold of you!!!!)

It was interesting to see how this would all work, but now feel demotivated from this sort of business somewhat for my first attempt and failure.

I am currently working on another business That I am posting about on these forums and that is going well it seems.

I am definitely always still in the search of RFP's for rock salt...and some other minerals I see being much more profitable and less seasonal.

RSimmons, send me a pm with your contact info and if anything comes up Ill have you to look into.

Thanks.

Hey Lagron,

sorry to hear you didn't get the contact but, don't be too swayed by the transit times from Egypt. You could always have the cargo brought in on the east coast and trained over to California (transit times in the states should only be about a few days).

I'll send you a PM and if you have questions I'd be more then happy help.