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Risks in freight

Risks in freight article image

In the world of goods export, there's more to risk minimisation than bubble wrap. Here's how to view your packaginginside and out. As far as freight mistakes go, Ross Gluer, general manager for the International division at TNT, says he's seen some disasters stem due to exporters failing to follow simple precautions. One of the most common mistakes concerns boxes stacked crookedly on a pallet. "If they're not stacked straight, the sides start to collapse, and if they're too high it breaks its own back," he says. Unfortunately, many exporters think the plastic shrinkwrap that covers the pallet will prevent their cargo from suffering this fate, but in fact misaligned boxes will cause the wrap to tear, which leads to the boxes becoming exposed to the elements and at risk of collapse. And if a box does become separated from its peers, you'd better make sure it has been labelled. "If the customer doesn't have a label on each box in a pallet and they separate, they take those cartons to an unrecognisable, unsendable, unprocessable area and they can just sit there," explains Gluer. While the experience of losing a couple of boxes in transit doesn't sound too bad, Gluer adds that product shrinkage can be catastrophic. "A lot of receivers will only accept goods if they're all present, they will not accept part delivery. If the other bit can't be found then the question is, what happens to stuff you still have? Do you send it back, do you hold it? Do customs hold it? Will it incur storage charges? And if a pallet does collapse it's not only going to be damaged, it's going to be late," he says. It's the exporter's inability to deliver the products as promised that has the most significant effect on business, he believes. "People have insurance against damage and you can recover costs one way or another but, as a rule, you can't recover your reputation." Gluer recommends exporters use standard pallets certified for export use, and keep the cargo to a manageable height; a 1.2 x 1.2-metre pallet should only be stacked to 1.2 metres to form a cube. "Keeping a fairly even height to width ratio means it is most likely not to get damaged, and it's likely to stay dry because the shrinkwrap won't be pulled around or torn," Gluer explains. And invest in decent packaging, don't have it as an afterthought. "Don't get skimpy," says Gluer. "Build it in on day one. Don't think, 'I've done all my costings, gosh, I need another two to three percent for packaging'. Get it right from day one in the commercial considerations."

Part and parcel

Another risk in packaging involves legal compliance and suitable marketing, which is especially important for people who sell to consumers in the international market. Exporters should firstly ensure that the physical packaging meets the requirements of the destination country; for example, food packaging needs to meet food grade standards of the market, which may be different from Australia's. Additionally, labels need to meet market requirements, says Ian Harrison, CEO of the Australian Made, Australian Grown (AMAG) Campaign: "You just need to be aware of the labelling claim requirements in the country where the product is being sold." Having the packaging and labelling right before entering a market is a key part of becoming export-ready, he advises. "All these things-packaging, compliance matters, costings, distribution arrangements, logistical arrangements-really do need to be considered and done properly before a business simply starts to spend money or export product." Exporters thus need to be aware of any difference in terminology between Australian indicators and other markets. Harrison gives the example of the USA, where 'Product of' and 'Made in' do not correspond to their Australian counterparts: "'Made in America' is a very high level of compliance similar to that of 'Product of Australia', whereas 'Product of America' is a lower category much the same as when we use 'Made in Australia', where there can be something like 50 percent of imported product," he says. "The most important thing for an exporter to have in mind is that when they're selling product in another country it's the laws in that other country that apply." The chamber of commerce network handles the paperwork for country of origin certification for the customs system, which will ensure that the correct tariffs apply. "Those documents are important, particularly where we have free-trade agreements with other countries," adds Harrison. However, country of origin labelling can have a marketing aspect to it as well, which is where AMAG comes in. As a certification trademark registered with IP Australia, 'Australian Made' or 'Australian Grown' must be used according to a set of rules under the Australian Competition & Consumer Commission, which administers the Trade Practices Act. But exporters shouldn't simply apply for the logo and slap it on, it needs to form part of a marketing strategy, says Harrison. "An important question that all exporters need to ask themselves in the market they're trying to sell to is, is there an advantage in the product being recognised as Australian? If there is, they should be aggressive about packaging their goods in a way that consumers can recognise or associate the product with being Australian," Harrison advises. "If it doesn't help the sale, then it's in the exporter's interest to downplay the fact. The use of AMAG can also be a marketing tool." The physical, legal and marketing risks in packaging can seem small, but all have the potential to ruin your exports if you fail to plan properly or heed the requirements, so make sure you check the boxes before you export.

Parcel tongue

Skilful translation is an essential part of having the right packaging from both a legal and marketing standpoint, says Linda LaCombe, regional business manager for Australia at Australian Export Translation Service (www.aetstranslation.com.au). What considerations should exporters make with regard to translating their packaging?

  1. Quality of translation: The translation must be both accurate and culturally appropriate for your target market. This requires experienced native-speaker translators and a rigorous quality-checking process.
  2. Usability: Some languages expand when translated, so may require more space than English to present the same information.
  3. Legality: Packaging needs to comply with relevant legislation in the target country. This may require translation of key product characteristics and other consumer information.
  4. Appearance: It’s important to note that font styles that look good to English speakers, for example, may not be attractive to Korean, Japanese or Chinese readers.

What are some of the legal consequences of having the wrong translation for packaging? Incorrect translations on packaging can cause products to be refused entry into a country or to be rejected by the distributor. Incorrect product information could also leave you open to legal claims through non-compliance with consumer laws or liable for damages resulting from the misinformation. What are some of the marketing consequences of having the wrong translation for packaging? Poor translations on packaging will damage customer perceptions of the quality of your brand and reduce their trust in your product. Because packaging is often viewed before purchase, poor translations can stop a purchase from taking place and severely impact your sales. How can exporters ensure they have the correct translation for their packaging? The most reliable way to ensure correct translation is to use a well-established professional translation company. They will have the resources, quality controls and experience to ensure translation accuracy and appropriateness. A good translation company can also look after typesetting for you, particularly important when dealing with many Asian and Middle Eastern languages with non-Latin alphabets. Having your distributor review and approve the packaging prior to printing and shipping is also sensible, provided you ensure the distributor doesn’t propose any translation alterations inconsistent with your product or legal requirements. It’s important to seek advice on the information you need to include on your packaging and finalise your text and design before you begin the translation process. Changes made after the translation process are more costly than changes made before translation. Allowing sufficient time for translation, typesetting and quality checking of your packaging (ideally, at least one to two weeks) will give the best chance of a high-quality result.

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