Lecture on international logistics - incoterms and documents required when shipping internationally.

1. International Logistics Incoterms and Documents

2. Learning Objectives

3. Role of Incoterms

4. incoterms internationally accepted commercial terms that clearly allocate transportation and other costs, risks, customs, and insurance responsibilities between seller and buyer first developed by the International Chamber of Commerce in 1936 INternational COmmercial TERMS

5. incoterms 13 terms clarify when the ownership of the merchandise takes place used in conjunction with a sales agreement or other method of transacting the sale independent of contract for carriage of goods

6. Responsibilities and Costs that need to be determined

7. Responsibilities/Costs Import license Import clearance Payment of import duties Consular fees

8. Responsibility Transfer Points Seller’s plant | Port of export | Ship’s rail | Port of import | Buyer’s plant

9. 13 Terms Origin Terms

10. 13 Terms International Carriage NOT Paid by Seller

11. Addendums are possible… CIF (named point) plus export packing is an example (export packing is normally seller’s responsibility) 13 Terms International Carriage Paid by the Seller

12. 13 Terms Arrival At Stated Destination

13. North American FOB Definitions

14. Terms of Sale – in international transactions…

15. Terms of Sale - point in time and geography when things change…

16. Point of title transfer Risk of product loss Transportation Cost of the product Movement facilitation costs Terms of Sales Issues

17. Logistics Manager role take active role as these decisions impact costs and service quality should be involved in establishing policies regarding terms of sales (and purchases)

18. Should specify Incoterms, year, named points as appropriate Specify temporary exclusions over which seller has no control …force majeure…wars, natural calamities, labour strikes, etc.

21. buyer can take possession

22. comparable to domestic COD Terms of Payment Options

24. sometimes mandated by foreign governments

25. seller’s money is tied up (cost of capital) and at risk

28. Dock / Warehouse Receipt

29. Packing List

30. Shipper’s Export Declaration

31. Validated Export License

32. Sight, Time Drafts

33. Bill of Ladings

34. Certificate of Origin

35. Commercial Invoice

36. Customs InvoiceMain Documentation used in Logistics

38. quantity

39. delivery instructions

41. If negotiable BOL..and is endorsed..title is transferred operates as a sight draft - payment must be made before goods turned over to buyer Ocean Bill of Lading

43. also depends on country from which goods originateCertificate of Origin

45. Provide valuation for customs

47. quantity and value

48. selling & delivery terms, instructions

53. expiration date

54. meeting every detail of the LC, e.g. modeSource: fpl.com Letter of Credit (L/C or LOC)

55. Issues for Logistics

56. Issues for Logistics

57. Sourcing decisions will impact costs Issues for Logistics

58. Dock Receipt Receipt issued by an ocean carrier or its agent for merchandise delivered at its dock or warehouse awaiting shipment.

60. itemizes the material in each individual package and indicates the type of package

61. shows the individual net, legal, tare, and gross weights and measurements for each package

62. should be attached to the outside of a package in a waterproof envelope marked "packing list enclosed.“

64. quantity

65. value FOB point of exit

67. Validated Export License a government-issued document that authorizes the export of controlled commodities to a specified foreign country within a specified time period Source: chagatrade.ru

68. Bhupesh Shah, B.Sc., MBA Twitter/Facebook/Skype: ethnicomm ©ethnicomm inc.