The shipping industry has a lingo all its own that it may be helpful for you to learn. If you are entering into exportation and importation business, it is important that you master these terms.
CIF (Cost, Insurance and Freight)
This term indicates that the insurance on the cargo and freight are to be taken care of by the exporter until the consignment gets to the point of delivery. For example, at CIF New York, implies that the exporter will be paying the shipping cost as well as the insurance of goods from the point of departure to New York. The term also implies that the importer is responsible for any other cost and insurance outside New York. In other words, the responsibility of the importer starts once the consignment gets to New York while the responsibility of the exporter ends when the consignment gets to New York.
This phrase means that the shipper may use any carrier that charges the lowest price for the shipment of the goods in question. However, in certain circumstances the shipper may opt for a carrier that charges a larger amount. If the carrier offers a faster delivery time, or a better insurance rate, or something like that, the shipper may choose that one.
This means that the shipper has to hand over the goods to the carrier indicated by the importer who will take charge of the consignment once the exporter hands them over.
Free Alongside Ship (FAS)
This means that the goods will be sent alongside the vessel by the exporter to the stipulated port.
DAF (Delivery at Frontier)
This is an acronym for delivered at frontier which means that the goods will be cleared before the customs by the exporter.
DDU (Delivery Duty Unpaid)
DDU means delivered duty unpaid. This term indicates that the goods will be delivered by the seller at the stipulated destination.
DDP (Delivery Duty Paid)
This means that upon delivering the goods at the stipulated destination, the exporter has to pay the charges for the delivery of goods.
Tips for Shipping
No matter which method of shipping you’re using, there are a few tips that you may find helpful. Here are a few tips that you may be able to apply to your business.
It’s important to use a shipping firm that’s reliable. This means you’ll have to do research on shipping firms up front. The internet is a good resource for this task. Read reviews of shipping firms you’re considering. Ask questions about the reliability of the firms so that you know who you’re getting into business with.
Make sure you’re packing your goods in the right box. This will help you to eliminate or reduce breakage that occurs on the way. You should create a list of all the items you’re shipping and have the shipping company sign this list before and after your shipment, so that nothing is lost during delivery.