01268 247 004

 

◊ Frequently Asked Questions

 

Here you will find answers to questions that regularly crop up. We've included as many questions as we can.

 

◊ Incoterms: What are they and why are they so important?


INCO 2010 are internationally accepted commercial terms defining the respective roles of the buyer and seller in the arrangement of transportation and other responsibilities and clarify when the ownership of the merchandise takes place. They are used in conjunction with a sales agreement or other method of transacting the sale.

 

Incoterms - Terminology

 

EXW

Ex Works

Title and risk pass to buyer including payment of all transportation and insurance cost from the seller's door. Used for any mode of transportation.

FAS

Free Alongside Ship

Title and risk pass to buyer including payment of all transportation and insurance cost once delivered alongside ship by the seller. Used for sea or inland waterway Transportation. The export clearance obligation rests with the seller.

FOB

Free On Board

Risk pass to buyer including payment of all transportation and insurance cost once delivered on board the ship by the seller. Used for sea or inland waterway transportation.

CFR

Cost and Freight

Title, risk and insurance cost pass to buyer when delivered on board the ship by seller who pays the transportation cost to the destination port. Used for sea or inland waterway transportation.

CIF

Cost, Insurance and Freight

Title and risk pass to buyer when delivered on board the ship by seller who pays transportation and insurance cost to destination port. Used for sea or inland waterway transportation.

DAT

Delivered at Terminal

Seller has delivered the goods, once they are unloaded and are placed at the disposal of the buyer at a named terminal at the named port or place of destination.

DAP

Delivered at Place

Seller has delivered the goods only when they are placed at the disposal of the buyer and are ready for unloading at the named place of destination.


Correct use of incoterms is essential to avoid misunderstandings and they will afford good protection in the event of disputes. For further information please click here. You may also like to read an Introduction to Incoterms 2010, and to also review the Incoterms Chart of Responsibility.

 

◊ Can I assume my goods are fully covered for Insurance when I entrust them to a Freight Forwarder?

No! Most Freight Forwarders, unless they specifically advise you otherwise, trade under limited liability conditions. This is the case with most other elements in the Supply Chain, e.g. hauliers, warehouses, ports, terminals, airlines, shipping lines etc. These limits will seldom come anywhere near the value of your goods, unless exceptional agreements are made.

Therefore, it is the responsibility of the owner of the goods to ensure Cargo Insurance Cover is in place to protect your specific consignments as they journey from A to B.

This will cover such risks as loss, damage, pilferage, strikes and riots, etc., until your cargo reaches a defined destination. Certain cargoes may attract exclusion clauses.

Therefore, you must not assume a Forwarder gives you full protection and most will need to be instructed in writing to effect cover on your behalf. You will be charged a premium for doing so.

It is important that you identify who is responsible for Insuring and you should refer to the Incoterm being used for your transaction.

Even if your buyer is responsible for effecting cover, you may wish to have in place a low cost Seller Risk Policy, for additional protection should you find your buyer is in default and the goods still remain your property.

Since a change in UK law we are now able to offer full risk insurance on request, please call for a quote, +44 (0) 1268 247 004.

◊ How can I keep packing costs down?


Packing is expensive and generally necessary. You have to consider both the value and the fragility of your product and then look at the stresses of the journey your goods will undertake.

For goods travelling as full loads in a Steel shipping container or on a trailer, packing can be much lighter � providing they will not be transhipped en-route (i.e. being discharged from one unit and reloaded to another)


For goods travelling by Air, cardboard and plywood protection will probably be adequate and will save both on materials and shipping weight. Making outer packages a closer fit will also save on shipping costs, which are almost always based on weight or measurement, and will also mean less risk of movement of contents in transit, which will reduce damage or loss.

However, if your goods are going to be shipped with other peoples� cargoes, packing must be adequate to withstand the rigours of handling and contact with other goods.

You also need to consider heat, cold, humidity and what will happen on discharge at destination.

 

◊ And finally...


1) Make sure your Insurers are satisfied with your packing standards as this can affect claims.

2) Remember to include packing costs in your product pricing.

 

 


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Trafertir International Transport Ltd is a company registered in England and Wales with company number 08996868.

 

© Trafertir International Transport 2014

 

Trafertir International Transport Ltd

5 Lords Court

Cricketers Way

Basildon

Essex SS13 1SS

+44 (0) 1268 247 004

+44 (0) 1268 247 005