Who should bear the freight forwarding charges for foreign trade exports?
Solved#Freight forwarding#
I am a staff member of a foreign trade company. Recently, when handling export business, I have some doubts about who should bear the freight forwarding charges. The contract we signed with the customer doesn't clearly state the attribution of the freight forwarding charges. In actual operation, should the freight forwarding charges be borne by us exporters or by the foreign importers? I hope friends who know about this can help answer it. Thank you!
Professional consultant answers
David LiYears of service：6Customer Rating：5.0
Senior customs declaration consultantConsult
In the absence of a clear contractual agreement, the bearer of the freight forwarding charges for foreign trade exports usually depends on the trade terms. Common trade terms such as FOB (Free on Board), the importer is responsible for arranging transportation and paying the freight, including the freight forwarding charges, and the exporter only needs to deliver the goods on board the vessel at the specified port of shipment. While for CIF (Cost, Insurance and Freight) and CFR (Cost and Freight), the exporter is responsible for transportation and paying the freight, and thus needs to bear the freight forwarding charges. So, first of all, you need to determine the trade term applicable to the contract, and then you can roughly judge the attribution of the charges. If the contract doesn't stipulate the trade term, both parties should negotiate and determine as soon as possible to avoid subsequent disputes.
William YangYears of service：5Customer Rating：5.0
International logistics consultantConsult
Generally, by convention, the exporter bears the freight forwarding charges under the CIF and CFR terms, and the importer bears them under the FOB term. However, if communicated in advance, it can also be flexibly changed. For example, even under the FOB term, if the importer requests the exporter to pay the freight forwarding charges on its behalf and then reimburse the exporter later.
Sarah ZhangYears of service：8Customer Rating：5.0
Document expertConsult
It can depend on the negotiating positions of both parties. If the importer is in a strong position in the market, it may require the exporter to bear the freight forwarding charges, even under the FOB term. Conversely, if the exporter is strong, it may make the importer bear the charges.
Joseph ZhouYears of service：10Customer Rating：5.0
Senior foreign trade managerConsult
If the added value of the goods is high, in order to ensure the transportation quality and service, the exporter may be willing to bear the freight forwarding charges to better control the transportation process.
Andrew HuangYears of service：7Customer Rating：5.0
Supply chain optimization expertConsult
If both parties have a long-term cooperation and a good relationship, they may negotiate with each other to take turns bearing the freight forwarding charges to maintain the cooperative relationship.
Emily LiuYears of service：10Customer Rating：5.0
Settlement and payment expertConsult
Sometimes the freight forwarder may offer some preferential schemes. If the exporter can get a better price from the freight forwarder, in order to attract customers, it may choose to bear the freight forwarding charges by itself.
Jennifer WangYears of service：4Customer Rating：5.0
Market development consultantConsult
If the export business is LCL (Less than Container Load) cargo, the determination of the bearer of the charges may be more complicated. Both parties need to communicate with the freight forwarder according to the actual situation to determine the bearer of the charges.
Michelle ChenYears of service：3Customer Rating：5.0
Business coordination consultantConsult
In some cases, the freight forwarder charges may be included in the price of the goods. Although it is not clearly stated on the surface who should bear them, they are actually reflected in the price. It should be considered comprehensively.
Robert ChenYears of service：6Customer Rating：5.0
Customer service consultantConsult
If the market competition is fierce, in order to facilitate the transaction, the exporter may take the initiative to bear the freight forwarding charges as a means of giving concessions.