We are super excited to announce that we have launched our CheMondis Incoterms Assistant. This feature helps every buyer in the chemical industry to find the fitting Incoterm when requesting an offer. Just by clicking through 3 simple questions.
During the past months we received a lot of feedback from our customers that finding a fitting Incoterm can be challenging.On our platform, but also in general. We started to research on our own and looked up many descriptions, illustrations, and definitions about Incoterms. However, we found most explanations to be complicated and overlapping. Nothing was easy enough to identify the fitting Incoterm at one glance or a few clicks.
Therefore, we developed a solution. The CheMondis Incoterms Assistant.
What are Incoterms?
Incoterms® (International Commercial Terms) are predefined commercial conditions used in international trade. They clearly define the tasks, costs, insurance, and risks on the buyer and supplier side. In total there are eleven different Incoterms which sometimes only differ in small details.
At CheMondis we have the Incoterms® 2020 in place. On our marketplace as well as on any other sourcing channel the supplier always needs to know about the requested Incoterm to be able to prepare an offer because the offered price largely depends on logistics, insurances, and custom responsibilities.
Details about each Incoterm are described at the bottom of the article.
How the CheMondis Incoterms Assistant works.
CheMondis customers can start the assistant directly from the request page. The assistant can also be started by non-CheMondis customers using this link:
https://chemondis.com/marketplace/incoterms/assistant
Now just 3 clicks are required to find the correct Incoterm easily:
- Do you want the goods delivered by the supplier or do you want to pick them up yourself?
- Where do you want the goods to be delivered or where do you want to pick them up?
- Select details about loading, insurances, customs, or risk responsibilities.
That’s it.
You will receive the suggested Incoterm including a description of the responsibilities for the buyer and the supplier. CheMondis customers can start the assistant directly from the request page.
Now It Is Up to You.
We are looking forward to your feedback on the CheMondis Incoterms Assistant. Let us know about what you think about it: Sebastian.Schnock@CheMondis.com
Incoterms in detail.*
You want to find out more about each Incoterm? Find our descriptions.
EXW – Ex-Works or Ex-Warehouse
EXW delivery method is the oldest delivery method used in international trade. The seller has no responsibility other than packaging the goods at their own facility and keeping them ready.
As soon as the buyer picked up the goods the buyer is responsible for transportation, loading, and customs and has all risks in case of loss or damage.
FCA – Free Carrier
Approximately 40 percent of international commercial transactions are carried out with FCA. The seller transfers the goods to agreed place (e.g. warehouse, airport, shipping terminal) named by the buyer at a specified dat. As soon as the seller completes the customs procedures, and from all costs and risks related to the goods pass to the buyer.
FCA delivery, which can be used in all types of transport, the responsibility of the seller ends without loading the goods, especially in sea transport.
FAS – Free Alongside Ship
FAS rules describes that the goods are placed on the dock or barge in the direction of the ship at the designated port of loading. Doing that the seller’s delivery obligation has been fulfilled. From this moment all costs and risks of loss or damage pass to the buyer.
FOB – Free On Board
FOB rules describes that once the goods are on the ship’s board at the port of loading the seller’s delivery obligation are fulfilled. From now on, during the shipping itself, any costs and risks of loss or damage belong to the buyer.
CFR – Cost and Freight
CFR rules describes that the seller needs to arrange and pay the transport and freight costs until the goods arrive to the port of destination. However, risk of loss and damage is responsibility of the buyer since the goods transferred to ship and onboarded with other possible expenses which may occur after loading.
CIF – Cost, Insurance and Freight
With the CIF rules the seller has the same responsibilities as in CFR (ensure the delivery to the port of destination). However, in addition the seller must obtain a sea transport insurance for the goods and must pay the insurance premium.
Please note that within the old Incoterms® 2010 rules, CIF and CIP had a standard minimum guarantee and referred to a shipping insurance. Now with Incoterms® 2020, the insurance coverage in CIF have different insurance guarantees unless otherwise agreed.
CPT – Carriage Paid To
CPT rules describe that the seller pays for the freight to an agreed destination. After transferring the goods to carrier-transporter all additional charges and risks are in responsibility of the buyer.
CIP – Carriage And Insurance Paid To
CIP rules describe the same obligations as the CPT term (freight to agreed destination), but in addition, it is obliged for the seller to provide the buyer with cargo insurance against the risk of loss and damage during the transportation of the goods. The seller concludes the insurance contract and pays the insurance premium.
Please note that within the old Incoterms® 2010 rules, CIF and CIP had a standard minimum guarantee and referred to a shipping insurance. Now with Incoterms® 2020, the insurance coverage in CIP has increased to “all risks” unless otherwise agreed.
DAP – Delivered At Place
DAP rules describe the seller’s obligation to deliver the goods to an agreed place of destination. All risks of damages and loss as well as all costs belong to the seller.
DPU – Delivered At Place Unloaded (replaces Incoterm® 2010 DAT)
DPU rules describe the seller’s obligation to deliver the goods to the designated destination and to unload the goods including all risks due to damages until the unloading has happen.
In Incoterms® 2010 rules DAT (Delivered at Terminal) described the delivery to a terminal while in Incoterms® 2020 the term “terminal” has been removed as the delivery and unloading can happen at any place.
DDP – Delivered Duty Paid
The DDP rules describe the seller’s obligation to transport to goods to an agreed place and to complete custom clearance as well as unloading the goods. Seller is responsible until the goods are on the ground of agreed place.
Sounds complicated? Use our Incoterms Assistant for your next request:
*Investopedia, (2021).
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