What are Incoterms and when are they used?
Incoterms is an abbreviation of International Commercial Terms. The Incoterms provide a common set of rules for the most often used international terms of trade.
The goal of the Incoterms is to reduce confusion over interpretations of shipping terms and for you to choose the right ones based on your organization and how familiar you are with international transport. Further, the terms will outline the obligations for the clearance of the goods and delivery.
Most used Incoterms
EXW (Ex work)
Ex means from. Works means factory, mill or warehouse, which is the seller's premise. EXW applies to goods available only at the seller's premises. Buyer is responsible for loading the goods on truck or container at the seller's premises, and for the subsequent costs and risks.
In the quotation, indicate the named place (seller's premises) after the acronym EXW, for example EXW Hong Kong and EXW China.
FOB (Free on board)
The delivery of goods on board the vessel at the named port of origin (loading), at seller's expense. Buyer is responsible for the main carriage/freight, cargo insurance and other costs and risks.
In the export quotation, indicate the port of origin (loading) after the acronym FOB , for example FOB Hong Kong and FOB Guangzhou
CFR or C&F (Cost and Freight)
The delivery of goods to the named port of destination (discharge) at the seller's expense. Buyer is responsible for the cargo insurance, import duties, VAT, final delivery and other costs and risks. The term CFR was formerly written as C&F . Many importers and exporters worldwide still use the term
C&F . In the export quotation, indicate the port of destination (discharge) after the acronym CFR , for example CFR by air Roissy and CFR by sea Amsterdam
CIF (Cost insurance and Freight)
The cargo insurance and delivery of goods to the named port of destination (discharge) at the seller's expense. Buyer is responsible for import duties, VAT, final delivery and other costs and risks
In the export quotation, indicate the port of destination (discharge) after the acronym CIF , for example CIF by air London and CIF by sea Los Angeles .
FAST COURIER SERVICE
For quick delivery and light weight usually under 20 kilos you are using TNT/DHL/UPS logistics fast courier service .
Through TNT/DHL/UPS you can track your shipment online 24 hours after it has been registered and see where it stands. This tracking is free of charge and allows you to anticipate the delivery in advance.
It takes an average from 3 to 5 days for most destinations, the final delivery is guaranteed to your office and you have only the customs duties and local VAT to pay.
Remember TNT/DHL/UPS are only used for light weight.
OUR SERVICES
JTM is working with well recognized international forwarder to cover all worldwide destinations. We may change from time to time to benefit from the routine possible and enjoy the shortest delivery time
We are using all the Incoterms mentioned previously. Those are the most common ones and provide a complete set of solutions for you to decide the most appropriate way to import goods from us If you have your own agent in Hong Kong and agreements with a forwarder you may choose either Ex work or FOB Hong Kong .
In case you have no one in the Far East we can ship the goods up to your destinated airport and then take care of all the formalities for the loading and transportation of the goods on your behalf.