Dear Partner
Thank you for allowing us to quote on your opportunity.
We continuously work towards being as competitive as possible. There is no shortage of competitors and hence we work hard on streamlining our costing and offering.
We would like to detail the logic that is applied in our pricing setting, more specifically the component ‘import freight cost’.
There are 3 scenarios which we will detail below. First prize for both of us is that stock is available in SA and we can process and deliver the order immediately. Looking at the extensive Tactile range of products and often long sales cycles involved, bulk of our revenue concerns sales where the right product is defined and selected still and afterwards imported.
Goods in stock
Both of us prefer to have stock of what is required. When so we will deliver to you as per the terms agreed. Stock can be organized through communication, planning and the use of forecasts. Local delivery costs are either absorbed by Tactile or billed to the customer, this depends on the size of the order and the delivery location.
Import by air
Orders that do not qualify for sea freight import and/or orders that are more urgent require us to select import by air/plane. Different then passenger traffic, it takes longer to fly in goods. Together with the manufacturer and logistics partner we need to first prep the goods for export, select a flight, process paperwork and deliver the cargo to the airport terminal. This process could technically happen in a matter of days only however this has become the exception. The norm is now 1 to 2 weeks when a busy period or when encountering delays due to external factors such as strikes, local public or religious holidays and/or environmental conditions.
Furthermore, to lower this cost to the customer, we always aim to consolidate multiple orders into one larger air freight shipment. This means that where it is technically possible to deliver your order sooner, we ask you to take in account an additional 2 to 3 weeks so that we can increase the size of the shipment and reduce the average cost per parcel.
If there is no time to wait for consolidation, we can perfectly fly the goods in separately. This will be an additional cost and in order to preserve our margin we have to forward this to the customer.
The cost for airfreight is based on weight. Any logistics partner will determine both physical weight (kgs) and volumetric weight (m3) and whichever weight is highest will be used for billing.
Import by boat
Orders larger in quantity and/or orders for large items that require palletization are ideally imported by sea/ boat. Even if not a full container load, it is more viable to bring in goods by boat then by air. A certain minimum volume of goods is required though, eg it costs more to bring in 2 boxes by boat then by plane.
Transit time for imports by boat can vary from 6 to 12 weeks. Here again a process applies of prepping goods for export, selecting a vessel, processing paperwork and delivery of cargo to the selected harbor. The actual average time for a vessel to reach South Africa from the East is 3 to 4 weeks. Delays can take place due to congestion of harbors both sides, strikes, environmental conditions and busy periods.
Where possible, we aim to consolidate multiple orders into one shipment to reduce average cost per parcel.
Relationship Management
Please know we remain available to further discuss lead times, method of import and stock holding.
Your account manager and our procurement team in South Africa and Taiwan are available to jointly work out a timeline and supply chain that is as cost effective as can be to both parties.
Our intent is to be fully transparent enabling you to live up to commitments made.
Thank you for understanding.
