Last week of October, a seller running the Saudi line told me his forwarder of two years switched him from 45-day terms to cash before release. His 1,200 cartons for White Friday were still stuck in Jebel Ali.
The real pain isn't the money. It's time. Every extra day in port racks up storage and demurrage by the day, and last-mile appointments have to be rebooked.
It's not that the forwarder is being cold. In peak season they're fronting cash too. Carriers want deposits to lock space, duty has to be paid upfront, and delivery partners keep pushing settlement later. The money is all tied up in cargo.
My experience: a 40HQ on the Middle East lane takes 75 to 90 days from origin to cash back. Give a seller 45 days and the forwarder is financing them for over a month. At 1% a month in low season that's fine. When peak credit tightens, something has to give.
From what I hear, since October many forwarders on this lane cut the per-shipment credit cap from RMB 300k to 150k, with duty advances excluded. Some only extend terms on freight now and ask sellers to prepay duty.
So what do you do? Don't treat credit as a given. Confirm your peak limit a month ahead and put it in writing, not just a handshake. Keep two approved forwarders. Don't put everything in one basket.
One more trap: duty advance interest often isn't in the quote. Ask if it's per shipment or per day. Over a year that's tens of thousands of RMB.
Also ask what happens to the clock if the container gets rolled. Does the credit period restart?
Shipping in batches buys you room. Split 1,200 cartons into three lots, and each remittance covers the next lot's freight. Cash keeps moving.
We're tightening terms this peak season too, so we put the rules on the table early.
Have you locked in your credit line for this peak season?