IMPORTANCE OF INCOTERMS IN SEA FREIGHT (2024)

If you are involved in international trade, you may have heard of the term Incoterms. But what are they and why are they important for sea freight?

Incoterms, short for International Commercial Terms, are a set of rules that define the responsibilities and obligations of buyers and sellers in cross-border transactions. They specify who pays for the transportation, insurance, customs clearance, and other costs associated with the shipment of goods. They also determine the point at which the risk of loss or damage to the goods transfers from the seller to the buyer.

There are 11 Incoterms in total, each with a three-letter code that indicates the type of contract and the allocation of costs and risks. For example, FOB (Free On Board) means that the seller delivers the goods on board the vessel at the port of shipment and pays for the export clearance. The buyer bears all costs and risks from that point onwards, including the freight, insurance, and import clearance.

Incoterms are important for sea freight because they help to avoid misunderstandings, disputes, and legal issues between trading partners. They also provide clarity and certainty for both parties, as they know exactly what their obligations are and what to expect from each other. By choosing the right Incoterm for your sea freight shipment, you can optimize your costs, reduce your risks, and ensure the smooth delivery of your goods.

But how do you know which Incoterm to use? There are many factors to consider, such as the nature of the goods, the destination country, the mode of transportation, and the level of control you want to have over your shipment. You also need to be aware of the latest changes and updates to the Incoterms rules, which are revised every 10 years by the International Chamber of Commerce (ICC). The current version is Incoterms 2020, which came into effect on January 1st, 2020.

That's why you need a reliable and experienced logistics partner who can guide you through the process and help you select the best Incoterm for your sea freight shipment. At DreamWorks Global Logistics Limited, we have experience in providing end-to-end logistics solutions for our clients across various industries. We have a team of experts who are well-versed in Incoterms and can advise you on how to use them effectively for your sea freight needs. We also have a network of trusted agents and carriers who can handle your shipment with care and efficiency.

Whether you need FCL (Full Container Load), LCL (Less than Container Load), or RoRo (Roll-on/Roll-off) services, we can offer you competitive rates, fast transit times, and flexible options for your sea freight shipment. We can also handle all aspects of your shipment, from documentation and customs clearance to warehousing and distribution. With us, you can rest assured that your goods will reach their destination safely and on time.

If you are interested in learning more about our sea freight services and how we can help you with your Incoterms selection, please contact us today. We would love to hear from you and discuss your logistics needs. Don't miss this opportunity to work with one of the leading logistics providers in Nigeria. Let us make your sea freight experience a breeze!