What should I consider when exporting? 

  • Who is responsible for the freight charges?
  • What will the freight cost be?
  • How will I get paid?
  • What documentation will I need to provide?
  • What if something goes wrong?

For help on the above read below or request a callback or email us now.

Who is responsible for the freight charges?

Great news, your first potential overseas customer has contacted you and wants some prices for your product, but who will pay for the freight charge and how do you make it clear what is being included in your price?

Often an overseas customer will want the shipper to arrange the transport for them and they are not just interested in an ex-works unit price. When quoting (as with any domestic transaction) it is critical to make it clear to them what you are including.

International freight charges are often made up of many distinct elements so it is important to define what you are including and where your responsibility ends. This is done using INCOTERMS.

INCOTERMS are an internationally recognised protocol which provide 11 different 3 letter terms which identify who is responsible for which parts of a freight transaction.

The latest version of Incoterms is the 2010 version.

Put simply the terms range from EXW (ex-works) where in effect the buyer of the goods is responsible for all of the freight charges from the sellers door to final delivery – through to DDP where the seller of the goods is responsible for all of the charges form door to door including any duties/taxes payable at destination.

At Allenco we are happy to help in explaining what each Incoterm means and the implications for you and your customer. Contact Allenco now for further help.

What will the freight costs be?

From your initial contact with your customer you have established that he wishes you to arrange the transport and he (or you) have specified the Incoterm you will use. Now you need to get a freight price so you approach a freight company. In order to have a productive conversation the freight forwarder will need to know:

  • What product you are shipping
  • How many pieces you have to move and their weights and extreme dimensions (length, width and height).
  • How quickly you need the goods to arrive at destination
  • The Incoterms you are planning to use or which part of the freight transaction you will be responsible for.

Once your freight company has this information they can readily supply you with a quotation which you can provide to your customer. At Allenco we handle all types of freight by every mode, contact Allenco now for a competitive quote.

How will I get paid?

This is probably the single most important aspect of the transaction from your perspective. Sending goods overseas without ensuring payment is either received or guaranteed in some way is clearly foolish. There are various tools that can be used to manage payment from the overseas customer. Ideally payment will be received up front against a pro-forma invoice, but if that is not possible payment can be secured upon the release of negotiable documents perhaps using a documentary letter of credit.

If you are considering offering credit to your overseas client it would be sensible to use an overseas credit insurance service  if the insurance company won't insure the credit risk, then payment via a secure method is the only way forward.

If you are producing a bespoke product which you may not be able to sell elsewhere it would be sensible to secure a considerable deposit (or full payment) prior to commencing manufacture.

We cannot guide you as to whether a risk is appropriate or not but we can suggest alternative ways of securing payment. Contact Allenco now for more information.

What documentation will I need to provide?

This is really determined by your customer or the Customs authorities in the country of destination. The best way to find out is to ask your customer. They should be aware of what the documentation requirements are. Also in asking the consignee you are putting the onus of responsibility upon them.

Alternatively you can consult publications such as “Croners Export Reference Guideâ€Â or “Tates Export Guideâ€Â, but your customer may be in the best position (through their own experience) to know exactly what they need.

What if something goes wrong?

Freight insurance is critical. All carriers liability is severely limited often by international agreement or treaty, or carriers terms and conditions. If you fail to insure your goods and you suffer a loss, for example the freight is mislaid, stolen or damaged in some way, you will have little recourse with the carrier. To avoid this situation make sure that you either have your own insurance in place or instruct the freight company to quote to insure the goods (before shipment).

For further information call us now on 0121 685 4445

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