This is not a hypothetical. This happened to us.

And if it can happen to us — a team that has been on the ground in China for over 10 years, that visits suppliers in person, that knows this industry from the inside — it can happen to anyone sourcing remotely from behind a screen.

Here’s what we saw, what we did, and what it taught us about one of the most dangerous and least-talked-about risks in China sourcing.

The Freight Forwarder Problem Nobody Talks About

Most brands obsess over supplier risk. They worry about product quality, MOQs, lead times, and factory audits. All of that matters.

But there’s another risk sitting quietly in the middle of your supply chain that doesn’t get nearly enough attention: your freight forwarder.

The freight forwarding industry in China — particularly the cross-border e-commerce segment — has exploded in recent years. Hundreds of small operators, many of them one-person shops, entered the market promising rock-bottom rates and seamless delivery. The competition drove prices down. The margins became razor-thin. And when margins are razor-thin, the first thing that disappears is financial stability.

What you’re left with is an industry full of operators who are one bad quarter away from collapse.

We’ve seen it happen. More than once.

What “Double Clearance” Actually Means — And Why E-Commerce Brands Use It

If you’re shipping goods to Europe, North America, or Australia for e-commerce, you’ve probably heard the term “double clearance, tax included” (双清包税).

Here’s what it actually means: the freight forwarder handles both export customs in China and import customs at the destination, bundling the duties and taxes into their fee. For e-commerce sellers, it sounds ideal — one price, no surprises, no dealing with customs yourself.

The problem is how some of these operators actually clear customs. Not always through official channels. Not always with complete documentation. Sometimes through consolidation methods that cut corners on compliance.

We ran double clearance shipments for a French client — 20 to 30 consignments per year. Every single year, one or two of them hit a problem. Not sometimes. Every year. That’s not bad luck. That’s the structural reality of the channel.

We don’t use double clearance much anymore. We file our own customs declarations. It costs more. It’s worth it.

The Day Our Freight Forwarder’s Upstream Collapsed

We had vetted this freight forwarder ourselves. We visited their office before doing business with them — something most importers never do. We looked them in the eye. We checked their setup. We decided they were legitimate enough to work with.

Then their upstream carrier collapsed.

Visit One: We had already done our due diligence before the relationship started. We knew who we were dealing with.

Visit Two: When the upstream carrier went under and shipments stopped moving, the freight forwarder went quiet. They stopped returning calls. They stopped responding to messages. So we showed up at their office unannounced. We found them there, caught off guard. We made clear we weren’t going away.

We also started making calls — to the local government, to the industry and commerce bureau, to the logistics industry association. Within days, it was clear that multiple parties already knew about this situation. The complaints had already been filed. The operator was already on the radar.

Visit Three: We went back. This time, the owner sat down with us. Under pressure from regulators and industry bodies, they agreed to cover the cost of recovering our cargo from the overseas carrier.

We thought we had won.

We Still Lost Cargo

Even after three visits. Even after government intervention. Even after the operator agreed to cooperate.

Here’s what we found on the other end: the overseas carrier had been holding goods from more than 20 containers (40HQ). The warehouse was chaos. Cargo from multiple consignments had been mixed, mislabeled, or left unaccounted for. Nobody at the overseas end had any incentive to sort it out carefully.

Some of our client’s goods were recovered. Some were not.

That’s the real world. Even when you do everything right — vet the operator, show up in person, apply every lever of pressure available — you can still take a loss.

What This Means for You, Sourcing Remotely

Now think about what the average importer does.

They find a freight forwarder online. They compare quotes. They pick the cheapest one. They send payment. They wait.

They have never seen the office. They don’t know if there’s even a real office. They have no idea whether the operator has one employee or twenty, whether they own their own trucks or rely entirely on sub-contractors, whether their upstream carrier is financially stable or three weeks from insolvency.

We recently saw a case that illustrates this perfectly. An experienced Australian e-commerce seller — someone who had been importing for years, who had a China sourcing agent for their core products, who had hired a trademark lawyer in China — used an online freight forwarder for a large seasonal shipment. The goods were time-sensitive. World Cup merchandise. A fixed sales window.

The freight forwarder told them the goods were delayed at sea. Then that they were held in Australian customs. Then, weeks later, admitted the goods had never actually been shipped. Two months of lies. A business running out of stock. Customers waiting on backorders. A sales window closing by the day.

This seller did a lot of things right. But they had a blind spot: nobody was watching the freight forwarder.

The Questions You Should Be Asking Before You Ship

If you are moving goods from China, here is the minimum standard of due diligence:

About the freight forwarder:

• Do they have a physical office you can verify?
• How long have they been operating?
• Are they a licensed freight forwarder or a broker sub-contracting everything?
• What happens to your cargo if they go under?

About the shipment itself:

• Do you have a proper contract with penalty clauses for delay?
• Will you receive a Bill of Lading, Packing List, and customs declaration within 48 hours of departure?
• If something goes wrong, who is your point of contact on the ground?

About the channel:

• If you are using double clearance, do you understand what that actually means for your documentation and legal recourse if something goes wrong?
• Have you considered whether the savings justify the risk for this particular shipment?

What We Do Differently

We are not a freight forwarder. But freight and logistics are part of every end-to-end sourcing engagement we manage.

We have learned — sometimes the hard way — that logistics oversight is not optional. It is the last link in a chain that we have built from the beginning. We know which operators in our region are stable. We know which ones to avoid. We file proper customs declarations. We verify that goods have actually left China before telling a client they are on their way.

And when something goes wrong — because sometimes it does, even when you do everything right — we are already there. Not scrambling to find someone to call. Not waiting for an overseas operator to pick up the phone. There.

That’s what it means to have someone on the ground.

If you’re managing your China logistics from behind a screen, you’re not managing it. You’re hoping.

We can help you do better than that. Get in touch.

Tom Sourcing is a US-registered sourcing company with its own office and warehouse in China. We provide end-to-end sourcing, product development, quality control, and supply chain management for US and EU brands.