Archive List for Logistics Column

This is the easiest explanation of FOB condition!

Logistics Column

What’s FOB? ・ Terms and conditions of transfer of responsibility on the deck of the ship FOB is one of the International Commercial Terms which is called Incoterms as abbreviation. FOB refers to the terms and conditions under which the responsibility for costs and risks transfers on the deck of a ship staying at the port of export. FOB stands for Free On Board, and in this case “Board” refers to the deck of a ship. So, FOB means, “On the deck of a ship, the exporter is free from the responsibility (the responsibility is transferred to the importer)”. In the shipping documents, the name of the export port is […]

What is CIF? Here is the easiest explanation of CIF and CFR!

Logistics Column

What’s CIF? CIF stands for Cost, Insurance, and Freight. And it usually followed by the name of the destination port / import port specified after. It refers to the conditions under which freight and insurance are prepaid by the exporter. In CIF terms, exporter pay the ocean freight and insurance to the destination port. The insurance required by CIF for sellers (exporters) are defined as the ICC’s tax payment amount (C), which is the minimum coverage. If the buyer (importer) is seeking a wider coverage of insurance terms, they need to be agreed in the contract. Characteristics of CIF ・ In terms of the cost and risk of the shipment, […]

What is DDP and DDU? Here is the easiest explanation of DDP, DDU, and also DAP!

Logistics Column

What is DDP ? ・In DDP, Exporter pay freight and insurance DDP are Initials of “Delivered Duty Paid”. It is one of Incoterms for trading. DDP refer to the term that Exporters pay freight and insurance. It included to Group D in Incoterms. Characteristic of DDP ・DDP requires Exporters maximum work and risk. For Importer, it requires minimum work and risk. DDP is only term that Exporters do import customs procedures For Importer, DDP is the easiest term in Incoterms. In contrast, Exporters have to do a lot of work in DDP. Exporters should cover freight and insurance until the cargo delivered to the designated destination in importing country. Further […]

The easiest explanation of Incoterm EXW(EX Works)! The detail of the deal condition and cargo risk responsibility.

Logistics Column

Aspects of EXW? EXW (EX Works) is one of the abbreviations called INCOTERMS that indicate the terms and conditions of trade. What is EXW? ・EXW is the least burdensome trade condition for sellers! INCOTERMS(International Commercial Terms) has 11 kinds of trade conditions, but EXW is the least burdensome and least risky condition for the seller. Delivery location of cargo that stated in EXW ・Delivery is completed at the seller’s factory or warehouse. Loading is also done by the buyer In EXW, the seller delivers the cargo to the buyer on their premises, such as a factory or warehouse. EXW stated for the seller only needs to keep the cargo at […]

Explain about Marine Insurance and Insurance Terms! To avoid the cargo damage risk during transportation, we need to know the type of Marine Insurance.

Logistics Column

Marine insurance is one of the indispensable risk management in trade. There are two major types of insurance by private companies: non-life insurance and life insurance, and what is used in trade is marine insurance called “Marine” among non-life insurance. This time, I would like to look at freight insurance, the knowledge of it is especially required for deal in trading. Parties involved in freight insurance An insurance company that pays out insurance is called an insurer (Assurer). Also, a person who can receive insurance is called Insured / Assured. Insurance period Insurance such as auto insurance and fire insurance is usually contracted on a yearly basis. However, the insurance […]

Customs/Bonded Area and Bonded Transportation! Explained the different type of Bonded Area in Japan.

Logistics Column

In logistics, knowledge of customs and customs duties is very important. With import and export, customs duties are imposed according to the regulations of each country, but in fact, the goods are not taxed immediately upon arrival. Did you know that there is a place where there is no tax for a certain period of time? They are called customs area or free trade zones. Let’s take a look at customs area and bonded transport, in order to carry the cargo smoothly and to facilitate trading. What is “bonded”? “Bonded” means the postponement of taxation of imported goods for a certain period of time until an import permit is obtained. […]

What kind of L/C are there? – Explain the type of L/C you better to know before you start trading

Logistics Column

L/C in trade can be divided into several types depending on the agreement and nature of the contract. I will explain the main types of L/C here. I believe it will help you deeply understand L/C and make your business more successful. Now, let ‘s take a quick look! Origin of L/C and documentary L/C L/C (letter of credit) was originally developed from a travel letter of credit. By travelers carry it, they can procure funds from the issuing bank. Commercial L/C have come to be used for commercial transactions as well, and this is now commonly called as L/C. As can be seen from its origin, it can be […]

Explanation about How to calculate air freight. How you compare size of goods and weight?

Logistics Column

Air transportation has an advantage which is faster than sea transportation. Normally, we use Air transportation service for small and light cargo delivery, or use it for urgent delivery case. Compared with the sea transportation, the air freight is more expensive than the rate of sea shipment. When you choose the air shipment, you have to understand how much is the air freight for your cargo delivery and you also have to understand how to calculate the air freight. However, you may think it is difficult for air freight calculation. If you understand how to calculate air freight, you can compare the benefit of each Air Line services. Also You […]

What is the L/C(Letter of Credit) deal? Explain its purpose, meaning, and related rules

Logistics Column

L/C (letter of credit) – Letter of Credit is one of the documents commonly used in transactions regarding international transport. In the case of international trade, the counterparties may be far away and their faces may not be visible, and risks such as non-payment are particularly concerned when starting new business. L/C is used to reduce the risks to deal with the company in other countries. If there is L/C, the bank that issued it guarantees payment, which makes it a very useful document for smooth transactions with the exporter/importer in overseas. Therefore, it is essential for trade to understand well about L/C. Here we will take a closer look […]

What’s AWB? Explain about the feature of Air Waybill and the difference between MAWB and HAWB.

Logistics Column

B/L is the important document for sea shipment and there are Master B/L and House B/L. And also there is Air Waybill(AWB) as an important document for Air shipment. This time I would like to explain about AWB in Air Shipment. What is AWB (Air Waybill) First of all, what is AWB (Air Waybill)? AWB is an invoice for international air cargo which plays the same role as shipping slip of EMS or DHL if it says simply. In the AWB we will explain the contents of what is described is as below. 1. Air Line Name 2. AWB number 3. SHIPPER: Shipper’s Name, Address 4. CONSIGNEE: Consignee’s Name, Address […]

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