Pricing

Project costs are broken down as follows:

I. Assembly and Inspection

PassageMaker charges a transparent per unit fee to perform inspection/assembly. This fee is based on the labor and management needed to inspect and assemble your given product.

Because the labor and material costs of final assembly/inspection/packaging are roughly the same if performed by PassageMaker vs. handled by a Chinese sub supplier, there are no major additional costs to client for engaging PassageMaker, yet the QC and IP protection benefits to the client are significant.

II. Costs of BOM (Bill of Material) such as Raw Materials, Components, Packaging Materials (inputs to be assembled and inspected by PassageMaker)

PassageMaker believes in an open book accounting policy with total transparency.  For every single line item in the BOM, the sub-supplier’s identity and pricing points are pre-approved by the client in advance. PassageMaker only source of revenue is the per-unit assembly/inspection fee. There are no hidden mark ups to the BOM and we do not accept commissions or payments of any kind from sub-suppliers.

If the client has existing suppliers for the BOM, we are happy to work with these vendors. If the customer does not have an existing China supply chain in place then PassageMaker can assist in finding qualified sub-suppliers. Please view the Sourcing Feasibility page for details on this service.

III. Vendor Coordination & Export Logistics

Client is welcome to organize on their own the delivery of BOM from sub suppliers to PassageMaker’s Assembly/Inspection center. However, due to distance, language, time and cultural barriers the majority of clients desire that PassageMaker’s China based, bi-lingual Project Managers serve as a liaison between the client and sub suppliers to ensure that customer requirements for price, quality and lead-time are realized. Please view the Vendor Coordination page for details on services and fees should you need assistance in this area.

IV. Warehousing

Warehousing is free assuming the orders flow out according to an agreed schedule.

 If client delays shipment or places excess components/finished product in inventory outside of parameters stated in service agreement, then a pre-agreed, set fee per cubic meter (cbm) can be applied at three phases:

1. In-coming (to upload and organize)
2. Weekly Space (First week is free)
3. Out-going (palletization and containerization)

Note: This standard method of calculation allows for scalable cbm-based billing and can take into account multiple components that change size during the assembly process. Take for example the case of a group of shoes being placed into their shoe boxes. Before assembly, 1cbm shoes + 1 cbm boxes = 2 cbm of billable space. However, once the shoes go into the boxes, then only 1 cmb is billable space. Our system is designed to prevent double billing and keep a fair record of actual space used at any given time.

V. Logistics

Clients are welcome to appoint their shipping and logistics partners as they see fit. However, as a free advisory service to our clients, PassageMaker’s in-house licensed customs brokers and logistics managers are available to coordinate door-to-door delivery, working to book the best rates and shortest lead times for freight on a global basis. We do not accept any commissions from shipping lines, freight forwarders or other supply chain service providers.

This free service includes:

• Consultation and coordination of Export Licensing and China Customs Clearance.
• Logistics Support in the form of documentation review and coordination of shippers, and brokers in China and in the client’s home market to ensure good rates and short lead-times.
• Analysis and Advise on applicable Value Added Tax (VAT) rates and potential rebate process.

Why doesn’t PassageMaker charge for Logistics Services?

Once a product has cleared outbound customs from China, just about freight forwarder or shipping partner in your home country with a basic amount of experience can arrange delivery to the destination market. However, orchestrating movement of goods from an inland China factory through outbound China customs and onto a ship / plane for eventual delivery to client’s destination requires a skill set that most non-China-focused logistics service providers simply do not have. While most of our clients have excellent shipping partners servicing their home markets, we have found that by leveraging our experience and shipping networks in Asia we can deliver the goods at a lower cost and shorter lead-time than if our clients organize things themselves. In short, we do it for free because it keeps customers happy and avoids unnecessary headaches for either party.

Value Proposition

In summary, the above system offers the benefits of going factory direct without the hassle of setting up your own China infrastructure for Vendor Coordination, Intellectual Property Protection, QC, Assembly and Packaging. The direct savings that our customers enjoy when their supply chains run smoothly far outweigh the cost to retain PassageMaker.

References readily available: Let us put you in touch with a current client in your area. PassageMaker will make every possible effort to meet potential customers in person to discuss your project details.

The typical PassageMaker client is a tier 1 or 2 supplier to major retailers. Many clients source upwards of USD 1 Million per year from China, but we welcome small and even new business as clients so long as their products demonstrate a high potential for growth and can commit at least USD 20,000 worth of PassageMaker’s services (which might include assembly, inspection, sourcing feasibility studies and/or vendor coordination).