successful exporting
TRANSCRIPT
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Process Of Successful
Exporting:
Terms , Documents and Procedures
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Our Objectives
Avoid the delays and over costing in deliveryour exports as agreed
Improve the participants knowledge andskills in export techniques and conditions
Analyze the different aspects of export
process Leverage costs and risks to conclude a
profitable business
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The Main Points:
Background 4 Main Terms of Trade transactions:
Delivery
PaymentShipping
Insurance
Export Documentation & procedures Conclusion
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1.BACKGROUND: Exporters must bear in mind:
It is not an easy business
The agreement with importer is just the beginning
Terms of a trade offer just the basis for save deal .
So.?
Other parties involved. So So many!!
Huge number of: Steps ..Documents .. Moves ..Risks
..Costs
Imagine How Complex is?
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Summary of Export Procedure
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2.DELIVERY TERMS
Reflects terms and conditions agreedupon between exporter and importer
Forms of agreements: Evidence for sale
International sales contract
INCOTERMS
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2.1. INCOTERMS
What ? International Commercial Terms (INCOTERMS)
Standard international legal instruments
Issued and revised by ICC
The most recent is INCOTERMS 2000 Classified into 4 main groups and 13 contracts
Why?
Avoid misinterpretation of sales conditions
Firmly determined Obligations and Responsibilities ofall parties
regard specific Risks and Costs
Ease and speed of disputes settlements
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4 Groups , 13 Contract 0f ( INCOTERMS 2000)
Stands forTERMGROUP
Ex WorksEXWEFree CarrierFCAF
Free Alongside ShipFAS
Free On BoardFOB
Cost and FreightCFRC
Cost, Insurance andFreight
CIF
Carriage Paid ToCPT
Carriage and Insurance
Paid ToCIP
Delivered At FrontierDAFDDelivered Ex ShipDES
Delivered Ex QuayDEQ
Delivered Duty UnpaidDDU
Delivered Duty PaidDDP
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How to choose the right contract
Barging power of the parties ( exporter and
importer) : The Strategy
Mode of transport
Accustomed trade practices
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Trade terms and Modes of transport
GROUP TERM Mode of Transportation
Land Ocean Air Multimodal
E EXW
FCA
FAS
F
FOB
CFR
CIF
CPT
C
CIP
GROUP TERM Land Ocean Air Multimodal
DAF
DES
DEQ
DDU
D
DDP
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Summary of Trade Contract Responsibilities of the Exporter and Importer
GROUP TERM Trade Contract Responsibility
1 2 3 4 5 6 7 8 9 10
E EXW
1 2 3 4 5 6 7 8 9 10 11
FCA
FAS
F
FOB
1 2 3 4 5 6 7 8 9 10 11
CFR
CIF
CPT
C
CIP
1 2 3 4 5 6 7 8 9 10 11
DAF
DES
DEQ
DDU
D
DDP
Seller is responsible
Buyer is responsible
see the definitions of 1 - 11
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1 11 are ;Activities
costs, levies.
ect:
Inland freight in Seller's country;Delivery to the carrier or frontier.
1
Customs clearance in Seller's country.2
Payment of customs charges andtaxes in Seller's country.3
Loading to the main carrier or meansof conveyance.
4
Main carriage/freight.5
Cargo (marine) insurance.6Unloading from the main carrier ormeans of conveyance.
7
Customs clearance in Buyer's country.8
Payment of customs duties and taxesin Buyer's country.9
Inland freight in Buyer's country.10
Other costs and risks in Buyer'scountry.
11
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2.2. Payment Terms
Seller and Buyer whishes to reduce
financial risk and get a good deal
It cover three areas:
Currency
Credit Terms
Methods of payments.
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Methods of Payment Specified in the
contract and shown in the invoice base on:
Available Finance option
Accustomed contract terms
Timescale ( need for money) Political situation
Foreign currency considerations
Terms of contract
seller & buyer R/S
Importer funding
Risks of :
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Documentary Credits
Provide a better method to obtain payments:
Secure payments to exporter
enable importer to receive goods as ordered
The usual form is irrevocable credit Set out details of goods: price, packing, origin &
destination, type of price( FOB, CFR,CIF) , .etc.
Allied with basic documents such as: Invoice, Bills of
Lading( Sea way Bill, Multimodal transport document,Airway bill,..), Insurance policy.
DC my be the type issued and revised by ICCC andsubject to UCP 600
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2.3. Shipping Terms
SHIPPING service of high quality and low
cost is a source of exporters advantages
Shipping vary according to:Type of commodity
Modes of transports
Means of shipping Freight vary widely according the above
items
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3. Export Documents &
Procedures Document:
Official and obligatory
Commercial
Additional and optional
Procedures:
Customs and release
Shipping: arrange for space booking Applications for documents
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At Least 4 documents required:
Invoices ( pro-forma and commercial)
Packing List
Shipping Document: B/L , Airway Bill,Consignment notes, etc
Certificate of origin
see the attached file for copy documents
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4. Conclusion
Export business need more than just agreementwith an importer Remember that you need to check for 4 types of
terms and conditions: delivery, payment,shipping and insurance
INCOTERMS reduces conflicts and avoidadditional costs
Good shipping save money and improve yourimage
DC is a guarantee for payments Prepare right documents and start o release
early facilitate trade
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