Malaysia’s tech-savvy population of 31.53 million and fairly developed infrastructure have made it a great destination for imports from nations like China, particularly cross-border purchases from marketplaces like Alibaba and Taobao.
If you are engaging in cross-border eCommerce, Klang Valley is of particular interest as this area has among the highest eCommerce adoption rates in the country. The Klang Valley includes major urban areas with well-developed infrastructure like Klang, Petaling Jaya and Kuala Lumpur, while also including major gateways into Malaysia - Kuala Lumpur International Airport (KUL) and Port Klang (MYPKG).
But how do shipments from China, be they direct-to-consumer (B2C) or bulk freight (B2B) reach Malaysia? How do they reach addresses in Sabah and Sarawak, which is separated from West Malaysia by the South China Sea? First, we’ll need to consider the mode of transport.
Choosing Between Air Freight or Sea Freight
If speed is your priority, air freight’s speed is worth paying for. When not looking at other legs of the journey, a flight from Hong Kong or Shenzhen to Malaysia will take around a day at most. Sea freight could take a few more days to a week depending on the schedule.
On the other hand, if you are looking for the most economical way to ship your goods, sea freight is the way to go, as long as your shipment volume is large enough.
There are cases when air freight can be cheaper than sea freight. To understand this, it helps to see how air freight rates are calculated.
For air freight, rates are charged to the order’s volumetric weight (how much space it takes up) or its actual weight depending on which is greater. For less-than-container-load shipments, sea freight is usually charged by volumetric weight, with a minimum chargeable volume being 1 cubic metre (cbm).
Sea freight saves you money if your order is larger than 2 cbm. However, you don’t get those economies of scale for items that aren’t that big like small cartons that take up between 0.5 to 0.9 cbm since you’re paying for unused space. This is where air freight can be more economical than sea freight.
Fortunately, you don’t need to work all of this out on your own. Logistics service providers like Janio can help advise you on whether air freight or sea freight is better suited to your current leg of the supply chain and also offer you both shipping modes for your orders. To find out more, reach out to us below:
When choosing between air freight and sea freight, consider the following:
The weight and size of your shipment
The products being shipped
Air freight delivers shipments quickly, but can be limited in terms of what you’re allowed to transport. Bulky or oddly-sized items, or items deemed too dangerous to meet air freight’s restrictions on what can be shipped generally should use sea freight instead.
For instance, these products generally can’t be shipped via air freight: products containing gases, all things flammable, toxic or corrosive items like batteries, magnetic substances like speakers, perishable items and more. If you’re shipping these, it makes more sense to use sea freight.
B2C and B2B Shipping from China to Malaysia in 4 Steps
Your logistics supply chain from China to Malaysia can vary depending on your requirements and addresses but tend to follow some general steps. We’ll be using an example of shipments from Guangdong Province in China to Malaysia.
China: First Mile
The international shipping process begins with first mile delivery. This is where your order leaves the origin address, which can be an address your business owns like an office or warehouse or your supplier’s address.
Prior to delivery, packaging and labelling your orders appropriately can minimise any hiccoughs that could arise during the delivery or at customs. Events like turbulence during flights could jostle your orders, so sufficient padding and securing your parcels with the h-taping method could help. You can learn more about the h-taping method and other packaging methods in our packaging guide.
Additionally, the orders’ shipping labels and the appropriate customs documentation must be accessible for customs officers to inspect the shipment. For more details, you can look at our full parcel labelling guide which you can also find in our resources for B2C shipping to Southeast Asia.
Depending on your arrangements with your shipping partner, they will either come to an address specified by you to pick up the order or collect your item from a drop-off point that you’ll need to deliver your items to first. If you’re shipping with Janio, you’ll be dropping off your shipments at our warehouse in Shenzhen - especially good for shippers operating in Guangdong province.
China and Hong Kong Origin Customs Clearance and Freight
After your shipments have been collected, they need to be cleared for export by China’s and/or Hong Kong Customs at the international port or airport closest to your origin address. For sea freight, this could be one of the ports at Shenzhen or Hong Kong Port.
If you are shipping via air freight, the airport your goods will be shipped from will defer depending on the type of goods you are exporting. If you aren’t shipping dangerous goods, also known as DG, your goods can depart from Shenzhen Airport (SZX). Otherwise, your goods will be shipped from Hong Kong Airport (HKG). The destination airport in Malaysia, if you’re shipping with Janio will be Kuala Lumpur International Airport (KUL).
To get your goods cleared for export, your shipment usually needs to have the following documents ready:
Bill of lading
Exporting in bulk from China requires you to have an export permit or exporter of record before you can ship your goods out. Additionally, if you’re shipping any restricted goods, you’ll need to apply for a special export permit for these goods before it can be exported. You can check the Ministry of Commerce Republic of China's website to find out more on how to apply for the export permit.1 We’ve provided a site with an English translation in our references as well.2
To check if your goods fall under the restricted goods category, you can look up China’s Customs website.3 B2C exports from China don’t need export permits or exporters of record.
If you’re ever unsure about what kind of steps you need to take to export your goods from China, you can always check with our customs clearance experts if you’re unsure of which documents to apply for and how to declare your goods.
After checking these documents and clearing your shipments for export, your shipments can be loaded onto a vessel.
If you are shipping via sea freight with Janio, the destination port in Malaysia will be Port Klang (MYPKG). Shipments to Sabah or Sarawak will be transhipped via Port Klang fist.
As for air freight, your orders will land at Kuala Lumpur International Airport (KUL) if you are shipping with Janio. Shipments to Sabah or Sarawak will take a domestic transfer flight.
Arrival and Customs Clearance in Malaysia
Once your item arrives in Malaysia’s airport or port, your shipment will be transported into a customs warehouse for clearance. This warehouse is where the customs officers will inspect your shipments and shipping documents and determine if they are allowed to enter Malaysia.
To clear customs for import into Malaysia, you or your shipping partner would generally need to provide the following documents:
Certificate of origin
Master airway bill or bill of lading
Receipt of payment of import duty and import-related taxes
Other relevant permits, licenses, and certificates
If you’re shipping parcels directly to customers, you won’t need as many documents as listed above. The airway bill, packing list, commercial invoice and certificate of origin (if needed) are usually sufficient for clearance into Malaysia.
If your item is below Malaysia’s de minimis rate of MYR 500, then there is no need to pay import duties and taxes to the customs office.
The de minimis rate is a value threshold where fewer or no duties and taxes are charged if the shipment’s customs value is below it. This only applies to goods that are delivered via air freight.
In Malaysia, the customs valuation is calculated using the Cost, Insurance and Freight (CIF) method, which includes the cost of the goods themselves as well as freight and insurance costs. If you’d like a more detailed guide on dealing with customs clearance in Southeast Asia, you can check out our customs clearance resource.
On the other hand, if your goods exceed the de minimis threshold, higher import duties and taxes like income tax will be levied on your shipment. You would have to pay sales and service tax (SST) of between 5 - 10%, and the import duties and income tax depend on the product category as declared by the harmonised systems code (HS code) which could go up to around 25 per cent. You may find out the percentage of your import duties, and taxes you need to pay through Royal Malaysian Customs Official HS Code finder.4
If you are shipping in bulk, such as entire pallets, your importing party in Malaysia must first register with the Companies Commission of Malaysia for a license to import goods. Some items also need a license regardless, including batik sarong, electric domestic equipment, pharmaceutical products, and more. You may check out the list of items that require a license and permit to export or import on Malaysia's Customs website.5
Once registered, a company must then apply for an import license from the Ministry of International Trade and Industry (MITI). Malaysia uses a privatized single digital window for all import and export regulations called Dagang Net.6
The customs import declaration is also part of the customs clearance process but will usually be applied for by your customs clearance agent, like Janio.
If you’re still unsure about the customs clearance process, check out our updated customs clearance guide for more information.
Distribution and Last Mile in Malaysia
After clearing customs, your shipment will enter the distribution stage. B2B shipments that don’t need to be broken up can be shipped directly from the airport or seaport.
However, B2C parcels or bulk shipments that need breakbulk first need to be at a transport hub to sort them out before the last mile journey can begin. However, if the address is in East Malaysia such as Sabah or Sarawak, an additional domestic flight or transfer shipment may be needed before your orders can be sorted and delivered.
The last mile delivery stage is where your parcel will be sent from the destination warehouse to your consignee’s address. In Malaysia, this stage of the delivery is done via vans. During the last mile delivery stage, your logistics service provider will ensure that your shipment is received by your consignee.
Now that you’re familiar with the general steps needed to ship from China to Malaysia, you are better prepared to select the right shipping partner to help with your end-to-end international shipping needs.
Whether you need a complete end-to-end solution or a flexible set of logistics services as the last piece to your China to Malaysia logistics puzzle, Janio has the solution to fit your shipping needs.
If you'd like to find out more about how we can solve your SEA e-commerce cross-border delivery needs, come and have a conversation with us.