Navigating the Challenges of Overseas Material Procurement

Over the past 20+ years products imported from the Asia Pacific region have quietly buoyed the profits of North America’s largest builders. Products such as cabinets, countertops, light fixtures, floor tile, doors and more.

Most imported construction materials are about 50% less than the North American equivalent and some of the largest discounts can be found in kitchen cabinets and granite countertops. To realize these discounted prices, the purchaser must buy enough product to fill several shipping containers. For example, about 40 flat-packed apartment size kitchens fit into one 40-foot shipping container. Additional considerations when determining the final cost of the product should include shipping, anti-dumping, tariffs, taxes, duties, and other fees. Using a local coordinator can help in determining the applicable fees along with contract and pricing negotiations.

It is also important to confirm if the product has the required certifications. If ordering light fixtures or backlit mirrors for example they must have the proper certification for use in Canada or the USA.

Quality is often a concern. This concern can be alleviated by purchasing from trusted suppliers. For example, purchasing directly from the same manufacturer that sells floor tile to Home Depot. Or purchasing faucets and toilets from the same factories that produce brand name plumbing products. Although it takes time to find and secure trusted suppliers there are many benefits to dealing with reputable factories.

Another consideration is the lead time. While locally purchased materials may only take 2-3 weeks, when ordering overseas you should allow 2-3 months. This allows 1-2 months for manufacturing and an additional month for shipping. It is also prudent to be aware of any upcoming national holidays and the potential for port or railway strikes that may impact your scheduled delivery date. It is always best to leave ample time between when the product is needed and when the order is placed.

Breakage must also be accounted for. Rough seas along with the shipping and handling required to move the containers will inevitably cause some level of breakage. The type of product ordered will dictate the percentage of extra product that will need to be ordered. For mirrors breakage could be as high as 10-15%. Although mirrors are so inexpensive that ordering 10% more does not have much of an impact on the overall cost savings. With kitchens depending on the size of the order it would be ideal to order at least one extra of each kind. Worst case scenario, no matter what the product is you can always Fedex more parts and pieces by air if necessary.

Importing materials is challenging but can be rewarding when seeking cost savings on large projects. Putting the right processes and procedures in place will help to ensure success.

Before starting it is most important to determine if the project is suitable for importing by asking questions such as:

1.      Is the volume large enough to warrant the fees involved?

2.      Is the material required immediately or can it wait the required 60-90 days?

3.      Have trusted overseas suppliers been identified?

4.      Does your company have systems to manage the importing process?

If you have the volume, time, trusted suppliers, and internal systems in place then importing materials may be a good option for the project.

About Morgan Reynolds:

As the creator of Turnkey Hospital™ Morgan Reynolds is an inclusionist leader with exceptional experience in both procuring and working with overseas materials over the past decade.

Mr. Reynolds is also the Founder & CEO of Turnkey Future Corporation. Focusing on nationally significant infrastructure projects that are exceptionally large and complex with regional or national impact. Morgan was most recently honored with an invitation to the National Palace in Mexico to discuss their largest national energy and infrastructure projects.