In the global trade landscape, the choice of logistics mode for bulk cargo transportation is a critical factor that directly impacts a company’s operational costs and risk management. The “dual clearance with tax inclusive” service, which offers a one – stop – shop solution in international logistics, has gained popularity for transporting small – volume goods due to its convenience. However, when it comes to bulk cargo transportation, this mode reveals numerous drawbacks that cannot be ignored. This article will delve into the operation mechanism of dual clearance with tax inclusive, analyze the reasons why it is unsuitable for bulk cargo transportation, and elaborate on the significant advantages of modes such as CIF and DDU in this context.

I. The Essence and Billing Logic of Dual Clearance with Tax Inclusive

Dual clearance with tax inclusive (Delivered Duty Paid, abbreviated as DDP) is a special service mode in the field of international logistics. Understanding its essence is crucial when making decisions about bulk cargo transportation. Its core lies in “dual clearance” and “tax – inclusive.” “Dual clearance” refers to customs declaration in the exporting country and customs clearance in the importing country, while “tax – inclusive” covers all tax payments involved in the transportation process. This means that the logistics company assumes all customs clearance procedures and tax payments from the origin to the destination.

The consignor only needs to pay a fixed freight cost without having to worry about complex customs declaration processes, tariff calculations, or the preparation of customs clearance documents. However, this seemingly worry – free mode hides many potential issues in bulk cargo transportation.

There are mainly two billing methods for this mode, both of which have different cost implications for bulk cargo transportation. The first is billing by weight, which is based on the actual gross weight (in kilograms) of the goods. The unit prices vary significantly depending on the mode of transportation. In air freight, the unit price typically ranges from $3 to $8 per kilogram. For example, if a batch of goods weighs 1,000 kilograms and is transported from China to Europe at the higher end of the price range ($8 per kilogram), the freight cost alone would reach $8,000.

In sea freight, the unit price is relatively lower, generally ranging from $0.3 to $1.5 per kilogram. But for bulk cargo that often weighs hundreds of tons, the total freight cost can still be extremely high. For instance, for a 100 – ton (100,000 – kilogram) shipment, at a rate of $1.5 per kilogram, the sea freight would amount to $150,000.

The second method is billing by volume, which is applicable to light and bulky goods (i.e., goods whose volumetric weight is greater than the actual weight). The volumetric weight is calculated using the formula “length × width × height ÷ 6000” and serves as the basis for billing. In sea freight, the unit price for such goods is approximately $80 – $150 per cubic meter (CBM).

Suppose a batch of goods has a volume of 100 CBM; at a rate of $150 per CBM, the freight cost would be $15,000. In addition, dual clearance with tax inclusive may also involve various additional fees, such as fuel surcharges (usually 5 – 20% of the freight), remote area delivery fees ($25 – $50 per shipment), and inspection fees ($100 – $300 per instance). These hidden costs can significantly increase the total cost in bulk cargo transportation, sometimes even causing the freight to soar by more than 30%.

II. Applicable Scenarios and Limitations of Dual Clearance with Tax Inclusive

(I) Applicable Scenarios: The “Hassle – Free” Mode for Small – Volume Goods

The dual clearance with tax inclusive mode has unique advantages in small – volume goods transportation, but it fails to meet the needs of bulk cargo transportation. For individual buyers and small – and micro – sized businesses, such as international students sending dozens of kilograms of luggage overseas or small cross – border e – commerce sellers shipping a small quantity of products, this mode can save them from the cumbersome process of self – customs clearance.

These goods usually have a low value and small quantity, and handling customs clearance procedures independently not only consumes a lot of energy but also may lead to difficulties due to a lack of professional knowledge. By using the dual clearance with tax inclusive service, they can complete the transportation of goods easily by paying a relatively reasonable freight cost.

In the B2C cross – border e – commerce sector, some sellers offer a wide variety of products with small order volumes. Shipping goods overseas through dual clearance with tax inclusive can simplify the logistics process and reduce operating costs. At the same time, for sensitive goods with transportation restrictions, such as electronic products with built – in batteries and cosmetics, freight forwarders in the dual clearance with tax inclusive channels have the ability to handle relevant certifications, reducing the risk of customs clearance and ensuring the smooth passage of goods. However, these advantages are difficult to fully utilize in bulk cargo transportation.

(II) Limitations: The “Sweet Trap” for Bulk Cargo Transportation

However, when it comes to bulk cargo transportation, the limitations of the dual clearance with tax inclusive mode become very apparent. From a cost perspective, when bulk cargo is charged by weight or volume under this mode, the unit cost increases with the increase in cargo volume, resulting in an excessively high overall freight cost. This is because when pricing, dual clearance with tax inclusive service providers consider the complexity and risks of the service. For large – volume goods, the unit service cost does not decrease proportionally with the increase in volume. Meanwhile, various additional fees continue to accumulate in bulk cargo transportation, further increasing the transportation cost.

In terms of compliance, dual clearance with tax inclusive poses many risks, which pose a threat to the safety of bulk cargo transportation. Some freight forwarders may under – declare the value of goods to reduce costs. Once detected by the customs, the consignor will not only have to pay a large amount of back – owed duties but may also face huge fines, seriously affecting the company’s reputation. In addition, in consolidated container shipments, if the declaration of other goods in the same container is inaccurate, the entire container of goods will be detained, causing collateral losses to other consignors. For bulk cargo transportation, such risks can lead to incalculable losses.

In terms of operation, bulk cargo transportation using dual clearance with tax inclusive requires waiting for cargo consolidation and containerization, which leads to uncontrollable transportation timeliness. The sea freight transit time may be extended by 7 – 15 days. For some bulk cargo with high timeliness requirements, such as seasonal commodities and fresh products, such delays may cause the goods to miss the best sales opportunities, resulting in serious economic losses.

Moreover, the compensation terms of dual clearance with tax inclusive are often very strict, usually only covering 2 – 3 times the freight cost. Once the goods are lost or damaged, it is difficult for the consignor to obtain full compensation. For high – value bulk cargo transportation, such compensation standards are far from sufficient to make up for the actual losses.

III. Six Major Risks of Choosing Dual Clearance with Tax Inclusive for Bulk Cargo Transportation

(I) Cost Out – of – Control Risk

When choosing the dual clearance with tax inclusive mode for bulk cargo transportation, there is a risk of cost out – of – control. Under this mode, tax calculation is complex and uncertain. In the international market, tariff policies of various countries are constantly changing, and exchange rates are also fluctuating. When freight forwarders collect tax payments in advance and settle according to the real – time exchange rate, if there is a significant exchange rate fluctuation, the actual tax expenditure borne by the consignor may increase substantially.

At the same time, as the cargo volume increases, the accumulation of various additional fees will further exacerbate the cost out – of – control situation, severely affecting the company’s profit margin. In addition, some freight forwarders may have opaque charging practices, adding fees for various reasons during the transportation process, making it difficult for consignors to accurately estimate the transportation cost of bulk cargo.

(II) Legal Compliance Risk

In the context of increasingly strict global trade supervision, choosing the dual clearance with tax inclusive mode for bulk cargo transportation poses a high legal compliance risk. Many countries have strengthened the supervision of cross – border e – commerce transactions, requiring accurate declaration of goods values and relevant information. If consignors under – declare the value of goods through dual clearance with tax inclusive and are discovered, they will not only have to pay back – owed taxes but may also face legal lawsuits and huge fines.

In addition, for goods involving intellectual property rights, if unlicensed infringing products, such as counterfeit goods, are transported through dual clearance with tax inclusive channels and are seized by the customs, consignors will face the serious consequences of goods being destroyed and having to pay large – scale compensation. For bulk cargo transportation, a single legal compliance issue can cause a company to suffer heavy losses.

(III) Operational Transparency Risk

Under the dual clearance with tax inclusive mode, the operation process of freight forwarders often lacks transparency, which is particularly detrimental to bulk cargo transportation. During the cargo consolidation and declaration process, consignors may not be able to obtain independent customs declaration forms. This not only affects the company’s export tax rebate applications but also makes it difficult for enterprises to grasp detailed customs clearance information of the goods.

For some enterprises that rely on export tax rebates to reduce costs, the inability to obtain customs declaration forms means that they cannot enjoy tax rebate policies, increasing operating costs. At the same time, goods transported in consolidated containers cannot be tracked in real – time during the logistics process. Consignors have difficulty understanding the specific location and transportation status of the goods. Once problems occur, it is difficult to deal with them in a timely manner, which may lead to customer claims and other losses. In bulk cargo transportation, such information opacity may trigger a series of chain reactions.

(IV) Lack of Flexibility Risk

Bulk cargo transportation often has diverse requirements, such as batch transportation and special operations. However, the dual clearance with tax inclusive mode has poor flexibility in these aspects. For goods that need to be transported in batches, dual clearance with tax inclusive requires full – batch declaration, which may force consignors to pay high storage fees.

For goods that require special operations such as labeling and repackaging at the destination port, the services provided by dual clearance with tax inclusive agents are not only expensive but also difficult to meet the personalized needs of enterprises, increasing the operation cost and management difficulty of enterprises. In a rapidly changing market environment, bulk cargo transportation has a higher demand for flexibility, and the dual clearance with tax inclusive mode is difficult to adapt.

(V) Long – Term Cooperation Risk

From the perspective of long – term cooperation, relying on the dual clearance with tax inclusive mode for bulk cargo transportation has many hidden dangers. Due to various risks in the transportation process, such as customs clearance delays and goods loss, customers’ trust in the enterprise may decline, and orders may be cancelled, affecting the long – term development of the enterprise.

In addition, if the cooperating freight forwarder company operates poorly or suddenly goes bankrupt, the consignor’s goods may be stranded at the port, causing huge economic losses and even leading to the disruption of the enterprise’s supply chain. For enterprises engaged in bulk cargo transportation, a stable logistics cooperation relationship is of great importance, but the dual clearance with tax inclusive mode is difficult to provide such guarantee.

(VI) Policy Change Risk

International trade policies are constantly being adjusted, and tariff barriers and environmental protection regulations are becoming increasingly strict. For enterprises transporting bulk cargo through dual clearance with tax inclusive, policy changes may bring serious impacts. For example, if a country imposes additional tariffs on certain commodities, consignors using dual clearance with tax inclusive may not be aware of the policy changes in a timely manner, resulting in a significant increase in tax costs when the goods arrive at the port, squeezing the profit margin.

In terms of environmental protection regulations, if the goods do not meet the latest environmental protection requirements of the destination country, transportation through dual clearance with tax inclusive may result in the goods being returned, causing huge losses to the enterprise. In the complex and changing policy environment, bulk cargo transportation requires a more adaptable logistics mode, and dual clearance with tax inclusive is obviously difficult to meet this need.

IV. CIF and DDU: The Compliant Choices for Bulk Cargo Transportation

(I) CIF (Cost, Insurance, and Freight)

The CIF mode has obvious advantages in bulk cargo transportation. Under the CIF mode, the seller is responsible for transporting the goods to the designated port of destination and bears the freight and insurance premiums. Once the goods cross the ship’s rail at the port of shipment, the risk is transferred to the buyer. This mode has significant advantages. First, the risk transfer is clear. Once the goods are damaged during transportation, if the corresponding insurance has been purchased, the loss can be compensated by the insurance company. Second, the cost composition is clear and transparent.

Costs such as freight, insurance premiums, and tariffs are itemized, allowing enterprises to accurately calculate transportation costs and avoid unnecessary expenses. In addition, the buyer has a certain degree of autonomy in operation and can appoint a customs clearance agent to improve the efficiency and success rate of customs clearance. At the same time, under the CIF mode, the seller has more direct control over the transportation process and can better coordinate all aspects of logistics to ensure the timely delivery of bulk cargo.

(II) DDU (Delivered Duty Unpaid)

The DDU mode also demonstrates unique value in bulk cargo transportation. In the DDU mode, the seller is responsible for transporting the goods to the designated destination in the importing country but does not handle import customs clearance and tax payment. The core value of this mode lies in the controllability of taxes. The buyer pays tariffs independently, which enables them to take full advantage of various trade agreements and preferential policies to reduce tax costs. For example, enterprises can apply for specific tariff exemptions or preferential tax rates according to the nature of their goods, thereby saving a large amount of expenses.

At the same time, the buyer has the right to clear customs independently and can use their own tax number for customs clearance, which is conducive to obtaining relevant certifications quickly and shortening the customs clearance time. In addition, the DDU mode can seamlessly connect with overseas warehouses, realizing efficient distribution of goods and improving customer satisfaction. In industries with high requirements for distribution timeliness, such as electronics and clothing, the combination of the DDU mode and overseas warehouses can enable bulk cargo to reach customers faster, enhancing the company’s market competitiveness.

Industry research data shows that for bulk cargo transportation using CIF and DDU modes, the average cost is 18 – 25% lower than that of dual clearance with tax inclusive, the customs clearance timeliness is increased by 40%, and the customer satisfaction rate is as high as 92%. These data fully demonstrate the advantages of CIF and DDU modes in bulk cargo transportation. By adopting these two modes, enterprises can better control costs, reduce risks, and improve logistics efficiency, thus gaining a favorable position in international market competition.

V. Industry Trends and Compliance Suggestions

(I) Industry Changes under Tightening Policies

Currently, global trade policies are becoming more restrictive, which has a profound impact on the choice of logistics modes for bulk cargo transportation. Relevant directives issued by the European Union require the declaration of cross – border logistics data, which will greatly reduce the room for under – declaration in the dual clearance with tax inclusive mode. The United States has strengthened the review of the supply chain. Enterprises that adopt compliant transportation modes such as DDU and provide complete origin certificates and other documents can effectively avoid the risk of goods being detained.

In addition, many countries have also enhanced the supervision of goods safety and quality, requiring more certification documents and inspection reports. In this context, the compliance difficulty of the dual clearance with tax inclusive mode is increasing continuously, while traditional modes such as CIF and DDU, due to their standardized operations and high transparency, are more in line with policy requirements and are gradually becoming the mainstream choices for bulk cargo transportation.

(II) Paths to Compliance Transformation

To adapt to industry development trends, enterprises engaged in bulk cargo transportation should actively promote compliance transformation. In terms of tax compliance, enterprises should register relevant tax numbers in the destination country, accurately declare the value and information of goods, and save tax expenditures through compliant operations. At the same time, they should pay close attention to changes in tax policies of various countries, adjust tax strategies in a timely manner, and make full use of various tax preferential policies.

In terms of logistics optimization, enterprises can adopt modes such as “full – container sea freight + bonded warehouses” to optimize the logistics process, improve inventory turnover rates, and reduce operating costs. In addition, they should strengthen cooperation with high – quality logistics suppliers to establish long – term and stable logistics supply chains, ensuring the stability and timeliness of bulk cargo transportation. In terms of technological empowerment, enterprises can use technologies such as blockchain to track logistics information, realize the rapid preparation and sharing of customs clearance documents, and improve customs clearance efficiency.

Through digital tools, enterprises can monitor the transportation status of goods in real – time, discover and solve problems in a timely manner, and improve the transparency and controllability of supply chain management. At the same time, technologies such as big data analysis can also help enterprises optimize logistics decisions and reduce the costs and risks of bulk cargo transportation.

Conclusion: Re – balancing Costs and Risks

The dual clearance with tax inclusive mode does have certain advantages in small – volume goods transportation and specific scenarios, providing convenient services for consignors. However, for bulk cargo transportation, its hidden cost pitfalls, severe compliance risks, and operational limitations far outweigh its apparent advantages. Traditional modes such as CIF and DDU, although requiring more effort from enterprises in operation, can build a stable and sustainable supply chain system for enterprises through cost transparency, operational autonomy, and compliance controllability.

In the context of increasingly strict global trade supervision, bulk cargo transportation has shifted from “low – price priority” to “risk controllability.” Only by choosing a logistics mode that matches their own strategies can enterprises achieve stable development in the complex and ever – changing international market and find the best balance between costs and risks.