The most common terms are INCO (international commerce terminology)
Allocations of costs to buyer/seller according to Incoterms 2010
|Incoterm 2010||Export customs declaration||Carriage to port of export||Unloading of truck in port of export||Loading on vessel in port of export||Carriage (Sea/Air) to port of import||Insurance||Unloading in port of import||Loading on truck in port of import||Carriage to place of destination||Import customs clearance||Import taxes|
EXW -Ex works.
this is the least risk for the supplier. The buyer pays for all costs from pickup at the suppliers warehouse all the way through to delivery to your own doorstep. All the seller needs to do is make sure the stock is ready for pickup and that they are correct documents are ready for shipment. The buyer handles and pays for everything.
CFR – cost and freight.
The supply will range shipping to the local port of the Seller i.e. the country. The buyer then needs to arrange pickup from the local port to there doorstep. This also include customs clearance if necessary.
CIF – cost, insurance and freight.
Similar to the CFR however the Seller will also pay for insurance
DAT – delivery at terminal.
The supplier will range shipping to the local port of the Seller i.e. the country. The customs clearance and documents fees are sometimes paid for as well. The buyer then needs to arrange transportation from the local portal or terminal to the doorstep.
DAP – delivery at place.
The supplier will range shipping to the local port of the Seller i.e. the country. The customs clearance and documents fees are sometimes paid for as well. The goods are then delivered to the buyers doorstep.
Is very important to know exactly how the goods are being sent. The reason for this is you may be liable for additional customs clearance fees or in the case of damage to the item you may be responsible for having insurance.
Some of the options also mean you lose control over the shipping process which may result in higher costs.