Mak­ing ex­port and im­port easy in Bhutan

Business Bhutan - - Business - Yen­ten Thin­ley from Thim­phu

Tamu World­wide Ship­ping Pri­vate Limited has come a long way since its in­cep­tion in 2002 by Kamal Raj Gu­rung.

To­day, Tamu has be­come a lead­ing par­cel de­liv­ery ser­vice in Bhutan and has been keep­ing Bhutan con­nected with the out­side world, be­sides cre­at­ing a name for it­self as a ship­ping and lo­gis­tic freight for­ward­ing firm. Truly, they have made ex­port and im­port easy in Bhutan.

Talk­ing to Busi­ness

Bhutan, Tamu’s Kamal Raj Gu­rung said it’s im­por­tant to have clear un­der­stand­ing of the lo­gis­tic and ship­ping meth­ods in or­der to avoid risk and de­crease the ex­pen­di­ture in­curred on im­port­ing goods and ser­vices.

“Be­cause of the lack of this un­der­stand­ing, new and as­pir­ing en­trepreneurs don’t have con­fi­dence to es­tab­lish new busi­nesses. Wise and pre­cise se­lect­ing of the terms of ship­ment in im­port­ing goods would min­i­mize cost and risks in in­ter­na­tional trades; ul­ti­mately pro­mot­ing ef­fi­cient trade and sup­ply chain in Bhutan guided by a com­mon un­der­stand­ing,” he added.

Kamal Raj Gu­rung also ad­vises peo­ple to be wary about il­le­gal charges charged by for­eign ship­ping lines and bro­kers. “From our ex­pe­ri­ence, we came across many is­sues. Most peo­ple are not aware about,” he said.

He added, “Bhutanese busi­nesses and in­di­vid­u­als par­tic­i­pate in in­ter­na­tional trade with­out proper aware­ness of in­ter­na­tional poli­cies, pro­vi­sions and pro­to­cols; thereby find­ing them­selves in fake courier scams and other ship­ping swin­dles. We have wit­nessed Bhutanese busi­nesses and in­di­vid­u­als end up pay­ing huge des­ti­na­tion and de­mur­rage charges which in­crease the cost of goods and ser­vices. This ul­ti­mately leads to huge price of goods and ser­vices to our end Bhutanese con­sumers.”

Kamal Raj Gu­rung said it’s also im­per­a­tive to be fa­mil­iar with Inco-terms

- an in­ter­na­tional trade guide­lines es­tab­lished by the In­ter­na­tional Cham­ber of Com­merce in 1936 to cre­ate a bridge be­tween dif­fer­ent mem­bers of in­dus­try by act­ing as a uni­form lan­guage they can use to fa­cil­i­tate ef­fi­cient trad­ing.

“Though Inco-terms’ sole pur­pose is to fa­cil­i­tate ef­fi­cient trad­ing, but many of our coun­try’s busi­nesses and in­di­vid­u­als often seem to be trapped with com­plex­i­ties of terms used in in­ter­na­tional rules and are ex­ploited by other greedy traders be­yond bor­ders,” he added.

And with many coun­tries’ busi­nesses and in­di­vid­u­als aware of only CIF (Cost In­sur­ance Freight), he said they thus take part in im­port­ing their goods only in CIF term.

“Us­ing of CIF tremen­dously in­creases the cost of trans­porta­tion hence in­cur huge cost be­cause as ab­nor­mal and il­le­gal charges are added ex­tra on top of ac­tual des­ti­na­tion charges or ship­ping line charges,” Kamal Raj Gu­rung said, adding that it’s im­por­tant to be fa­mil­iar with other terms, meth­ods and pro­ce­dures such as Ex-work and FOB (Freight on Board) and that it is im­por­tant for busi­nesses and in­di­vid­u­als to ex­plore other meth­ods to ship their goods so that they re­duce their risk and cost.

The CIF method, ac­cord­ing to Tamu’s founder, in­curs huge cost be­cause mul­ti­ple agents are in­volved with pickup and ship­ping of goods and des­ti­na­tion charge is not pre­de­ter­mined. With mul­ti­ple agents, be­cause of in­di­vid­ual mar­gin of each agent, the cost of trans­porta­tion from one agent to an­other, firms in­cur huge ex­pen­di­ture and ul­ti­mately in­crease the cost of goods and con­trib­ute to huge out­flow of money.

“Most Bhutanese firms and in­di­vid­u­als are only aware of this method as shared by their busi­ness sup­pli­ers/part­ners and use this ship­ping method only,” he added.

How­ever, in Ex-Work and FOB, ac­cord­ing to Kamal Raj Gu­rung, a sin­gle agent cho­sen by a firm or an in­di­vid­ual deals with pickup from the right­ful sup­plier’s ad­dress and is shipped. There­fore, com­plete quo­ta­tion is shared with cus­tomers and des­ti­na­tion charges are pre­de­ter­mined too. Doc­u­men­ta­tion is prop­erly and se­curely han­dled by the sin­gle agent and reg­u­lar up­date pro­vided as per re­quire­ment.

“Proper doc­u­men­ta­tion is im­por­tant to avoid de­mur­rage and de­ten­tion charges,” he added.

Kamal Raj Gu­rung re­it­er­ated that fake courier scams and many other ship­ping swin­dles re­sult in un­nec­es­sary out­flow of cash.

“Our coun­try would save ap­prox­i­mately Nu 10mn a year if proper ship­ping and freight for­ward­ing is car­ried out. This will ef­fec­tively save our coun­try’s eco­nomic debt,” he said.

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