Message from ARC to our customers in the E.U.

[Pete.Participant @pete-2]

This all sounds like a good idea to start sourcing goods made in this country, don't complain when the price reflects that the people making those goods want to enjoy a similar quality of life to yourself though.

[Ketan SwaliParticipant @ketanswali79440]

Posted by Ady1 on 10/12/2020 13:37:49:

Posted by ChrisB on 10/12/2020 11:17:08:

UK traders will be at a disadvantage when compared to Chinese traders. I do not know how they manage to deliver at such low postage rates,

Mr Trump was trying to put a stop to that

The Chinese postal system is subsidised by western countries postal charges

https://www.bbc.co.uk/news/world-europe-49816654

And I believe that this was the outcome. We wait and see who will implement the outcome, and how.

Ketan at ARC.

[Douglas JohnstonParticipant @douglasjohnston98463]

Brexit Pandemic Getting old Taxman has just given me a refund .

Merry Christmas,

Doug

[SamsarandaParticipant @samsaranda]

Ketan’s link to the Postal Union illustrates why it costs us an arm and a leg for postage from anywhere in the US, I admit that I have bought items from the US, postage on an envelope full of papers was a surprise, almost more than the papers were worth. It looks as though next year holds quite a few surprises and not all will be welcome.
Dave W

[peak4Participant @peak4]

It may not be that easy importing things from China post Brexit either; I should say I've not checked this out myself, but have seen similar references elsewhere.

This is from a Twitter feed by Paul Eldred @pauleldred, who describes himself as
"Hertfordshire accountant specialising in small businesses and start-ups."

"A friend has received an email from a Chinese supplier this morning saying that his order has been returned to the supplier by Chinese customs. Apparently if goods cannot be guaranteed to arrive before 31 December they are not leaving China."
"China has a trade agreement with the EU. Para 3 Article 50 says that all agreements cease. So UK doesn't have any agreement with China from 00:01 on 01 January 2021. The fall back is WTO but our tariffs and quotas haven't been agreed."
<a couple of comments from other contributors>
"But we trade with China under an EU agreement. All agreements cease at midnight on 31 December as per the terms of para 3, Article 50."

Without wishing to stray into politics on this forum, for those who do have a Twitter account Dr Anna Jerzewska is worth reading.
She is a genuine trade expert, sometimes asked to appear before government committees to provide advice.
If she has quoted/re-tweeted someone, it's likely to be both true and informative.

Bill

[Dave HalfordParticipant @davehalford22513]

Posted by Douglas Johnston on 10/12/2020 14:03:33:

Taxman has just given me a refund .

Merry Christmas,

Doug

I had one of those tax man messages on my phone – funny thing is the tax man hasn't got my number and when i did get a real refund it was a cheque in the post.

[V8EngParticipant @v8eng]

Can you think of a Caption?

 

.If we need to start making things after Brexit I will have to teach those blokes how to use this!

Edited By V8Eng on 10/12/2020 16:33:20

[Steve NeighbourParticipant @steveneighbour43428]

.

Can you think of a Caption?

I'm sorry, but your big round thingie is no where near shiney enough, now go and polish it – there's a good chap !!

Steve

[Martin DowingParticipant @martindowing58466]

Posted by Ketan Swali on 09/12/2020 21:02:22:

At present we are uncertain if a solution for reduction in courier costs and delays can be found. If and when this happens, we will provide our customers with an update.

For now, we can only apologise for the inconvenience. We are very much aware that this development will make ARC less competitive for consideration by our E.U. customers.

Ketan at ARC.

It seems to be a deliberate design to engineer business environment in such a way that only Chinese goods are competitive.

Large number of various engineering goods from Ali and Banggood are now distributed from Germany at the same price you can buy them from China, so Chinese and German businesses have certainly found their way around a taxman.

But Western manufacturing gone down the drain.

[Sam Longley 1Participant @samlongley1]

If the percentage of Ketan's business overseas is significant then there is a solution. I would guess that just about 90% of what he sells is imported anyway. If he is not selling to the EU he is not importing . If he tells us he does not make much profit then he is not loosing much. The Uks imports are less.

But if it is a significant business, rent a wharehouse in Boulogne (or wherever) I am sure that other small businesses will get wise & shared arrangements can be set up., import the goods to there & send them from there to the EU customers. The bookwork can be handled from the Uk by computer. Profits can come back to Uk so that foriegn tax is limited. All you need in Boulogne is a manager and a couple of parcel packers.

Is it really so hard, once the initial problems are sorted & of course there has to be a will to develop a business opportunity. Ketan already has the supply chain to his business ,He knows how to handle the goods, he has experience of international trade. He has all the tools he needs.  The hard bit is building the initial stocks & moving small quantities from the Uk to ensure he has the stock in the EU to start it up.Of course he will need additional capital to cope with the extra stock until it starts to move. He then needs to change the delivery address & learn to manage French company rules.

 

Edited By Sam Longley 1 on 10/12/2020 16:57:07

[Another JohnSParticipant @anotherjohns]

But if it is a significant business, rent a wharehouse in Boulogne (or wherever) I am sure that other small businesses will get wise & shared arrangements can be set up.,

Sam – this happens a lot with businesses that are in Canada, but deal with the USA.

Even for individuals – google "shipping to Ogdensburg" – Canadians around here will ship to an address just across the border, then drive over, and declare the goods on return. (not now though due to COVID the border's closed).

I have not bothered doing this yet, but I know multiple people who use this service – a bit of a ride in the car, about $10.00 for the bridge tolls, and pick up your parcel, and skip the $$ customs import fees that would be put on the package.

Sure, you have to pay duty on the border, but there is some exemptions for day-trips, from what I understand.

(if I miss picking up a parcel, last time I drove to the local UPS depot, it was 2 hours round trip with city driving – almost faster to drive to the USA…)

—-

I used to purchase stuff from the USA and ship to Canada, but as 99% of it is from China, I order directly now, and sometimes the parts + postage from china is LESS than the shipping from the USA, and that's not even taking into account the markup by the companies in the USA.

—-

Funny world – John.

[MeunierParticipant @meunier]

To put into monetary terms, I am expecting a consignment from UK, paid in GBP, total cost GBP618.31
Have just done a comparison if the same consignment arrived after Jan 1 2021. Some rounding up of pence/centimes.

Bought at GBP 515.26 incl GBP30 shipping and no VAT charged –
all following in GBP

485.26 items cost
30.00 freight cost
1.20 freight cost rise (4.9% extra)
3.50 shipper export documentation
total on leaving UK = 520.26

over the channel, all in Euros

GBP 520.26 becomes Euro 572.29

13.20 shipper import docs (GBP12 x 1.10)
58.55 10% import duty (assuming no deal and WTO rules apply)
21.00 customs paperwork fee for collecting import duty
now up to 665.04
133.02 VAT
Total Euro 798.06 or equivalent GBP 725.51 to my door, compared with GBP618.31 today,

DaveD

Edited By Meunier on 10/12/2020 17:45:55

GBP 107 more expensive — OUCH

Edited By Meunier on 10/12/2020 17:46:36

Edited By Meunier on 10/12/2020 17:47:20

And after all that I forgot to send a big thank you to Ketan and the team for good past services

Edited By Meunier on 10/12/2020 17:49:32

[IgnatzParticipant @ignatz]

Ketan,

With regard to my remark about the customs charges, I would like to point out that the major difference for the purchaser of goods coming from the UK into Belgium is the so-called 'inspection charge' that the customs people here in Belgium levy on top of the tax upon the goods and shipping.

This 'inspection charge' – equal to about 20£ – is not levied upon shipments from within the EU.

Since the UK is leaving the EU, this means an additional cost for those here in Belgium who choose to purchase goods from the UK.

That extra charge can potentially make the difference in one's decision to purchase from a supplier in the UK or a supplier on the continent.

Just sayin'….

[Douglas JohnstonParticipant @douglasjohnston98463]

Posted by Dave Halford on 10/12/2020 16:20:12:

Posted by Douglas Johnston on 10/12/2020 14:03:33:

Taxman has just given me a refund .

Merry Christmas,

Doug

I had one of those tax man messages on my phone – funny thing is the tax man hasn't got my number and when i did get a real refund it was a cheque in the post.

Yes I got a real cheque in the post.

Doug

[Ady1Participant @ady1]

Just get rid of all the freeloading lawyers politicians and bureaucrats and we can post stuff wherever we like

These "trade issues" are problems made up by people who don't actually do real work, they "skim" money for a living

All Brexit negotiations are finished this weekend…

…because they don't want this minor matter interfering with their 4 week xmas holiday on full pay

[SillyOldDufferModerator @sillyoldduffer]

Posted by Sam Longley 1 on 10/12/2020 16:50:52:

…

But if it is a significant business, rent a wharehouse in Boulogne (or wherever) I am sure that other small businesses will get wise & shared arrangements can be set up., import the goods to there & send them from there to the EU customers. The bookwork can be handled from the Uk by computer. Profits can come back to Uk so that foriegn tax is limited. All you need in Boulogne is a manager and a couple of parcel packers.

…

Certainly possible, but is it worth doing? European Warehouses and staff cost money; computer systems cost money; managing the profits, tax and regulations cost money. More complicated and costly than not having a border unless it's done on a large scale. Necessary to stay on the ball too. Governments constantly seek to seal tax loopholes: not paying attention to the latest rules can suddenly make a company liable in several countries.

The approach favours the big boys rather than small business : the sort of multi-national that sells Chinese goods in the UK, pays tax in Eire, banks in Lichtenstein, is registered in Switzerland and no-one knows who the owners are! Another issue when companies go international in this way is they don't look to return profits anywhere in particular. Why should they? There is no 'home' in a global economy. Isle of Man, Seychelles, Panama, Canary Islands – loads of tax-exempt places to bank foreign profits.

We're moving from a situation in which UK trade was almost seamless to something else. Change is coming. Glad I'm retired and don't have to sort it out! It's a toughie.

Dave

[oldveloParticipant @oldvelo]

It was not broke I did not need to fix it. Now I wanted to break it so now we all need to work to fix it.

[SamsarandaParticipant @samsaranda]

Trade between the Uk and Eu countries hasn’t always been smooth and without problems, I remember about 25 years ago when working as a Quality Manager at an engineering company producing electrically driven pumps, we were supplying a number of them to a company in Spain. They required us to certify that the electrical side of the product complied with some obscure Spanish regulation, the fact that the product met all required EU regulations wasn’t sufficient for them, not only that they required that all the declarations were in Spanish, this was contrary to EU practice and Spanish was not one of the officially designated languages but English was and always has been. Sorry to sidetrack the thread but it illustrates that our stay in Europe wasn’t always roses but one consolation then was we didn’t have to pay any tariffs to trade with Spain.
Dave W

[Ketan SwaliParticipant @ketanswali79440]

Posted by Martin Dowing on 10/12/2020 16:43:01:

Posted by Ketan Swali on 09/12/2020 21:02:22:

At present we are uncertain if a solution for reduction in courier costs and delays can be found. If and when this happens, we will provide our customers with an update.

For now, we can only apologise for the inconvenience. We are very much aware that this development will make ARC less competitive for consideration by our E.U. customers.

Ketan at ARC.

It seems to be a deliberate design to engineer business environment in such a way that only Chinese goods are competitive.

Large number of various engineering goods from Ali and Banggood are now distributed from Germany at the same price you can buy them from China, so Chinese and German businesses have certainly found their way around a taxman.

But Western manufacturing gone down the drain.

Hi Martin,

It is a case of swings and roundabouts. Examples:

• When ARC started in this line of business, 98% of its revenue came from hobby customers. Today about 50% of ARCs custom comes from business customers, who are Western manufacturers – small, medium and large. Whilst orders from hobby customers go up and down, orders from business customers continue to grow at a steady pace.
• ARC, along with most trading companies operating in this environment have lost many hobby customers to the likes of operators which you suggest. A certain percentage of that loss is due to the buyer having poor product knowledge, viewing YT videos and buying good or bad products through the sites you mention. Many such buyers are new to the hobby with zero engineering experience. Some loose interest quickly and move on, and some stay, happy with their purchase, or replace with products from reputable companies.
• Many Chinese trading companies operating through fulfilment freight forwarders based in Southampton shut down, or went bust, or moved on to freight forwarder fulfilment centres in Hamburg for example. This took place after UK HMRC warned such UK freight forwarders to clean up their act or be held liable for certain practices. It would seem that the customs in Hamburg are more accommodating to such companies, turning a blind eye. We can only hope that sooner or later they too will/might see the light.
• Things are not so rosy for German companies servicing the hobby/engineering sector. I am aware of well known companies (which I don't wish to name), who are suffering because of such Chinese companies setting up in Hamburg. In one case, to compete against the Chinese trader, the traditional German business changed from a good Chinese supplier to a cheaper bad Chinese source, resulting in poor quality. They are suffering.
• As a wise 'Bandersnatch' (member on this forum) once told me, If we are unable to compete, it would be better to get out of the kitchen. Rather then compromise by failing to supply a consistent product, ARC has dropped sales of quite a few products.
• Regardless of how big the Ali/Banggood/Ebay/Amazon platforms are, they still mainly serve the hobby market, which is far smaller than the business engineering market throughout UK and Europe.

Ketan at ARC

[Ketan SwaliParticipant @ketanswali79440]

Posted by Sam Longley 1 on 10/12/2020 16:50:52:

If the percentage of Ketan's business overseas is significant then there is a solution. I would guess that just about 90% of what he sells is imported anyway. If he is not selling to the EU he is not importing . If he tells us he does not make much profit then he is not loosing much. The Uks imports are less.

But if it is a significant business, rent a wharehouse in Boulogne (or wherever) I am sure that other small businesses will get wise & shared arrangements can be set up., import the goods to there & send them from there to the EU customers. The bookwork can be handled from the Uk by computer. Profits can come back to Uk so that foriegn tax is limited. All you need in Boulogne is a manager and a couple of parcel packers.

Is it really so hard, once the initial problems are sorted & of course there has to be a will to develop a business opportunity. Ketan already has the supply chain to his business ,He knows how to handle the goods, he has experience of international trade. He has all the tools he needs. The hard bit is building the initial stocks & moving small quantities from the Uk to ensure he has the stock in the EU to start it up.Of course he will need additional capital to cope with the extra stock until it starts to move. He then needs to change the delivery address & learn to manage French company rules.

You are probably right Sam. Where there is a will, there is a way.

At present I am content with my lot. Lets see how things develop over time.

Ketan at ARC

[Ketan SwaliParticipant @ketanswali79440]

Posted by Meunier on 10/12/2020 17:42:25:

58.55 10% import duty (assuming no deal and WTO rules apply)

To the best of my knowledge, the import duty % will be based on country of origin (i.e. manufacture) of goods. Not sure at present, but unless EU decides to take the U.S. tarriff route/action against China, it could be less than or around 2%, rather than 10%. Also, to re-confirm, the duty element will only apply to goods value (inc. carriage) over 150 euros.

Ketan at ARC

[Ketan SwaliParticipant @ketanswali79440]

Posted by Ignatz on 10/12/2020 17:55:04:

Ketan,

With regard to my remark about the customs charges, I would like to point out that the major difference for the purchaser of goods coming from the UK into Belgium is the so-called 'inspection charge' that the customs people here in Belgium levy on top of the tax upon the goods and shipping.

This 'inspection charge' – equal to about 20£ – is not levied upon shipments from within the EU.

Since the UK is leaving the EU, this means an additional cost for those here in Belgium who choose to purchase goods from the UK.

That extra charge can potentially make the difference in one's decision to purchase from a supplier in the UK or a supplier on the continent.

Just sayin'….

Yes Ignatz, I understand. Depending on which courier is used, they can call it import entry charge, administration charge, or even an inspection charge for anything which enters into the EU from outside.

In my opening post, I mentioned that the couriers we use 'will charge the importer between £11.50 to £13.00 to make an import entry in the country of destination.'

Whilst in your case the courier may have stated 'inspection charge', what they really mean is an admin fee of some kind. It is rare to be charged an actual 'inspection fee' – which is a thing, which someone may charge for physical inspection of goods – by customs – depending on 'which customs route' your consignment goes through. As far as I can recall, Customs route 1 is for documentary check, route 2 for physical examination of goods by customs, route 3 is for consignment to go through without any checks. Usually, this is a random process.

I also understand that the import administration/entry charge can potentially make the difference in one's decision to purchase from a supplier in the UK or a supplier on the continent.

Ketan at ARC.

Edited By Ketan Swali on 10/12/2020 20:50:19

[speelwerkParticipant @speelwerk]

An attractive young woman in a high-vis jacket with safety glasses and helmet is struggling to read the digital version of MEW on her Tablet. And she owns such a nice lathe! What could possibly be wrong?

Can you think of a Caption?

Dave

Safe to use?

She is checking if the lathe complies to the higher standard of British health & safety regulations going in force January 1ste 2021.

[peak4Participant @peak4]

Ketan, I appreciate this might not affect you directly as it's concerned with EU>UK imports post Brexit, rather than vice versa, (and I think regardless of a deal.)
In a way, it seems to put UK buyers, from EU vendors, in a similar position to your EU customers.

If I've got my head round this correctly, the UK (and I think the EU) are removing the VAT exemption for low value imports.
At the moment in the UK, the VAT and any duties are collected by the carrier, and are due before final delivery; hence Royal Mail etc, leaving a card at the destination address detailing fees to be paid, and their admin charge for that fee collection. (Currently as we are within the EU, so long as VAT is collected at source at the appropriate rate for the vendor's country it's all OK)

When the rules change, VAT is to be collected by the vendor (if commercial, as opposed to a private sale), and must be paid to HMRC directly by the vendor.
In order to make this payment, the EU vendor must create an account with HMRC, for which they are charged a fee.
I believe this applies to non UK landed goods.

There are various press reports about this, but many are behind paywalls; This one explains the gist, and refers to some Star Trek items which is what caught my attention originally in The Times. (Paywall)
https://toyworldmag.co.uk/post-brexit-vat-rules-set-to-cause-significant-impact-on-trading/
https://www.thetimes.co.uk/article/its-vat-jim-but-not-as-we-know-it-william-shatner-laments-post-brexit-rules-5t26rdd6k

Freight forwarders ebay etc. seem to be able to collect the VAT on behalf of the EU vendor, and pay to their HMRC account.

This document seems to go some way towards explaining the situation, see para "How will the operation of VAT change after Brexit?" et seq.
https://www.instituteforgovernment.org.uk/explainers/tax-brexit

A small vendor may well feel that it's too expensive, or too much hassle, and thus not register with HMRC and so not be able to export into the UK.

An example came up on another thread on here where someone was pointed to an EU seller of some collets which aren't common in the UK.
If that vendor doesn't register with the HMRC, they won't be able to export here directly.
Indeed, when I looked at their website, I got a warning flag stating delivery only to EU (along with a couple of other countries, Suisse and Koweit sic.)
https://www.georgessavoie.com/en/store/collets-zugspannzangen-2/product-1.html
[Similarly, if you look at Stefan Gotteswinter's site, he doesn't currently export his precision stones to the UK.
I think this was due to the previous deadlines before the implementation of the withdrawal agreement]

Bill

Edited By peak4 on 10/12/2020 22:35:23

Edited By peak4 on 10/12/2020 22:36:58

[blowlampParticipant @blowlamp]

Posted by Michael Gilligan on 10/12/2020 12:33:01:

Posted by SillyOldDuffer on 10/12/2020 11:36:41:

.

Can you think of a Caption?

.

During the Covid lockdown, Anna had been working ‘virtually’ … but now had the opportunity to check how her Breech-Rings compared with what Great Aunt Ruby made during the War.

**LINK**

Ruby Loftus screwing a Breech-ring

MichaelG.

"If I'm going to be operating this thing again tomorrow, I'll make sure I wear a top that doesn't clash!"

[Author]

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