International freight forwarding companies introduce relevant knowledge of freight forwarding to you

1、 CFR/CNF.

Cost and Freight is translated as the cost and freight of the designated destination.

Calculate CFR.

CFR price, FOB price, freight.

CFR price=CIF price X [1- (1+insurance cost markup) X insurance product rate]

CFR precautions.

According to the CFR clause, it is important to pay attention to the issue of shipping notices. Due to the arrangement of transportation according to the CFR terms, the seller is responsible for arranging transportation, and the buyer is responsible for insurance. This is a key issue in the CFR contract, where the buyer takes out insurance before the risk passes to the buyer before shipment. Incoterms therefore emphasize that the seller must immediately notify the buyer that the goods have been shipped. Otherwise, the seller will default.

2. In the CFR clause, the burden of unloading costs is generally modified through the CFR clause.

For example:

The liner term (CFR liner term) refers to the handling of unloading costs in accordance with the liner terms, which are borne by the freight payer (i.e. the seller).

CFR bottom ship 'hold "means that after the goods can be transported to the destination port, the buyer's enterprise opens the cargo and bears the cost of unloading from the bottom to the port. It is worth noting that the economic conditions listed after the English professional term CFR at the University of Foreign Trade are only intended to help students understand how and where to bear the unloading fees under the charter method. However, there are no other types of changes in the boundaries between delivery points and risk management.

CFR hook delivery (CFRex handling) refers to the process where the buyer opens the cabin on their own after the goods arrive at the destination port and bears the cost of unloading the goods from the bottom of the cabin to the dock. It is worth noting that the conditions added after the term CFR in foreign trade English are only to clarify the issue of bearing pollution charges in travel leasing. However, the boundaries between the place of delivery and risk have not changed.

CFRLAUND (CFRLAUND) refers to the seller bearing the cost of unloading the goods to the destination port.

2、 CIF.

Also known as CIF, cost+insurance+freight, converted to cost price, insurance+freight, destination port. After the goods cross the hold at the loading port, the seller shall complete the delivery. The seller shall pay the freight and insurance fees for the goods from the loading port to the destination port, but the risk of damage and loss after shipment shall be borne by the buyer.

According to the CFR, the seller must pay the freight and fees required to transport the goods to the designated port of destination, but the risk of loss or damage arising from various circumstances and any additional costs arising from these circumstances shall be transferred by the seller to the buyer. However, based on the CIF price, the seller must also purchase marine insurance for the buyer's risk of loss or damage to the goods during transportation. So, the seller signs an insurance contract and pays the insurance premium. The buyer should note that the CIF clause only requires the seller to insure for a minimum amount. If the buyer requires a higher insurance coverage, it is necessary to reach a clear agreement with the seller or make additional insurance arrangements on their own.

CIF calculation formula.

CIF=(FOB price+freight)/[1- Insurance product rate × (1+insurance cost markup)

CIF=CFR Price/[1- Insurance Rate x (1+Insurance Bonus)]

CIF precautions:

Conceptual misconception: CIF and FOB, from the perspective of delivery point and risk point, are both on board the ship at the loading port. The seller will fulfill their obligations after safely loading the goods at the loading port. The seller is no longer responsible for any risks that may occur to the goods after shipment. The insurance policy, bill of lading, etc. shall be submitted by the seller. The buyer is responsible for handling risk claims and other work. After loading at the loading port, the seller receives the ocean bill of lading, hands over the main shipping documents to the bank or buyer, and bears the insurance, insurance policy, payment of sea freight and other fees at the loading port, and then fulfills all delivery obligations.

Booking and loading: The seller orders the ship based on the CIF price, selects a shipping company freight forwarder, pays the freight, dock fees, etc. Generally, the buyer's designated freight forwarder/shipping company is not accepted. In actual business, customers will choose well-known foreign shipping companies such as Maersk and APL, and generally confirm the freight with the buyer. It can also be accepted after the shipping date, but cannot be shipped by the buyer's designated freight forwarder.

When signing the contract, the seller should specify the insurance amount, insurance scope, insurance terms, insurance terms, and the period between the start and end of liability, and choose the insurance association or China Insurance Terms. When the bank presents the insurance policy, the insurance policy must be endorsed to the buyer. The buyer does not guarantee that the goods will inevitably arrive, nor does it guarantee that the goods will arrive at the destination. The seller shall not be responsible for any damage, dampness, loss or loss of the goods after shipment.

Unloading costs: dock operation costs, etc. CIF terms are usually CIF terms, with the seller bearing the cost at the port of departure, while the buyer is responsible for the shipping cost.

E. Notification management of shipping time, transit of Chinese goods, arrival date, etc.

If the goods are damaged or lost when the seller submits the documents, the buyer must still make payment against the bill of lading.

In actual business, it is unreasonable for the buyer to claim damages for the delivery of clothing/finished products due to delayed or delayed transit of goods at the transit port, delayed transit on time, container drop, and two or three times during transit, as well as air freight. How to avoid the seller's inability to guarantee the transit obligation on the same day after the goods arrive at the destination port when signing a trade contract.

3、 FOB.

In international trade, freedom on board, also known as FOB, is one of the most commonly used trade terms. Delivery on board a designated port of shipment, "custom" refers to ship to ship delivery. According to this regulation, the seller shall ship the goods to the vessel designated by the buyer at the loading port specified in the contract, and the buyer shall be responsible for dispatching the vessel to pick up the goods. The seller shall load the goods onto the vessel designated by the buyer at the loading port specified in the contract. During the shipping process, when the goods pass through the ship's hull, the risk passes from the seller to the buyer.

According to the FOB clause, the seller shall bear the risk and cost, obtain an export license or other official documents, and be responsible for handling export procedures. If the transaction is conducted according to FOB terms, the seller must also provide documents at their own expense to prove that they have fulfilled their delivery obligations; If the document is not a transportation document, the seller may assist in obtaining the bill of lading or other transportation documents at the buyer's request and bear the risk and cost.

Calculate FOB value.

Fob=cfr price - shipping cost.

FOB price=CIF price X [1- (1+insurance cost plus) X insurance product rate] - shipping cost.

FOB precautions.

1. The exact meaning of "ship's side boundary".

Using the loading port as the boundary between buyer and seller leasing risks is one of the important differences between FOB, CIF, CFR, and other transaction terms. Ship boundary "refers to the risk that the seller bears for the goods before loading, including losses caused by landing at the dock or sea during loading. After the goods are loaded on board the ship, the buyer should bear the damage or loss, including damage or loss that occurred during transportation. The term" ship "is the boundary for defining risk, rather than the boundary for the responsibilities and costs borne by the buyer and seller, because loading is a continuous process that involves loading from the shore Entering the cabin through the hull and loading. If the seller is responsible for shipping, the above work must be completed and the handover of the bow cannot be carried out. In fact, according to the terms of the contract or the "customary" practices stipulated by both parties, the seller of a foB contract is usually responsible for the actual shipment of the goods at the loading port and providing a settled bill of lading.

As for the burden of transportation costs, generally speaking, the seller should bear the main loading costs, excluding the cost of organizing the goods on board, namely repair and leveling. However, in fact, not all regulators are bound by this unified model. However, due to different reasons, the regulatory methods are different, which will be discussed in detail below.

2. Connection between ship and cargo.

According to FOB terms, the buyer shall be responsible for chartering the cabin and promptly notifying the other party of the date and name of the vessel, while the seller is responsible for shipping the goods to the vessel designated by the buyer within the specified period. However, if the buyer fails to deliver on time, the seller has the right to cancel the contract and demand compensation for losses, or to charter a ship for shipment on behalf of the buyer, or to demand payment on behalf of the warehouse bill of lading at the place of shipment. If the seller arrives early without their consent, the seller will not be responsible for the shipping and fraud costs. If the buyer ships on time, but the seller fails to ship on time, the seller shall pay the resulting cabin and cabin fees.

According to the FOB clause, sometimes the buyer can entrust the seller to book the shipping space, but this is only an agency nature, and the seller can agree or disagree. If the seller is unable to rent the ship or book the space, the buyer bears the risk and has no right to claim compensation for losses or terminate the contract.

In summary, according to FOB terms, transactions should be handled with caution in terms of the company's shipping schedule and port management regulations. After signing the contract, the company should also continuously strengthen its contact with the company in terms of cargo preparation and dispatch, and closely cooperate to ensure a good connection between ships and cargo.

4、 Common Points of Foreign Trade Quotation Methods for CIF, FOB, and CIF Prices

01. The seller's enterprise is responsible for loading and fully developing the notice, while the buyer is responsible for receiving the goods themselves;

02. The seller shall handle the export procedures for the enterprise and provide valid documents, while the buyer shall handle the import procedures for China and provide important documents;

03. The seller submits the documents, and the buyer accepts the documents and makes payment;

04. For delivery at the loading port, risks and costs are divided in the same way, with the ship's side as the boundary;

05. The nature of delivery is the same, both for voucher delivery and voucher payment:

06. Suitable for China's marine transportation and inland waterway transportation;

5、 Differences in three foreign trade quotation methods: CFR, FOB, and CIF

01. FOB: The buyer is responsible for chartering, booking space, and prepaying freight; Handling insurance and paying insurance;

02. CIF: The seller is responsible for chartering, booking, and prepaid freight; Handling insurance and paying insurance;

03. CFR: The seller is responsible for chartering, booking, and prepaid freight; The buyer is responsible for handling insurance and paying for insurance.