I have some difficult questions pertaining to a business I am launching here in Taiwan. I’ve recently gained access to the wholesale catalog for a jade supplier/designer in the US. The pieces are crafted from ‘A’ grade jadeite jade and come with certificates of authenticity. This particular supplier/designer has been in the business since 1976 and deals primarily in jadeite (Myanmar) rather than nephrite (China).
What I am concerned with at this point is pinning down the logistics of the operation and seeking out a local supplier/designer that works with the same quality of stone. However, at the moment I’ve no idea what the customs tax would be or what the best method of shipping would be (CIF or FOB). I read a post about someone being hit with a 30% customs tax for iHerb product, which raised my eyebrows a bit.
Hypothetically, if I purchase a piece at a keystone price of $500 USD and bear the cost of shipping $25.00 (based on weight/dimension of the parcel through FedEx), along with the cost to insure the item (@$1:$100 and which would only cover up to a declared value of $1,000), I’d be looking at a cost of $530.00 USD just to get the product to Taiwan.
At current exchange rates (1:31.96), this would mean a cost of ~16,940 NTD. Mind you, this is before markup since the hypothetical piece of jewelry was purchased at keystone (twice the cost to the manufacturer). Typically, jewelry is marked up 50-67% (according to Macy’s). I’ve set mine at 65% - meaning the piece would cost the customer ~28,000 NTD.
My questions are:
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Where is the customs tax calculated? At the final cost to the customer or the declared cost of the contents of the parcel?
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What would the customs tax be in the hypothetical scenario described above?
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Would it be best to setup a CIF (cost, insurance, freight) or FOB (free on-board) shipping agreement with this supplier?
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Aside from a business license, what other permits would be required?
Ideally, we’re looking for a local designer/supplier and even designing/crafting our own pieces. There are some difficult logistical issues to work through - and it’s definitely intimidating to be entering a space dominated by old Chinese men.
If anyone can lend clarity to the issues I’m facing that would help tremendously.