A Supply Chain Perspective

Music Explosion- Developing a “Sound” Global Transport Plan

PREPARED BY

MIESHA’ SWAIN

CASE STUDY 10-1

DR. MASCARITOLO, JOHN

INTRODUCTION TO TRANSPORTATION AND LOGISITICS

April 12, 2016

Given the information in the case, which Incoterms group (E, F, C, or D) should ME pursue as the exporter? Why?

ME should pursue Incoterms group C. Why? It is the best terms for sellers it consists of cost & freight, carriage paid to, delivered duty unpaid, and free carrier.

Cost and freight is water transported. It point must be a destination ocean port. Sellers controls the freight all the way to the destination port, but risk for loss passes to the buyer at the ships rail at the origin port.

Carriage paid to be it can be inland or to the buyer’s door. Seller controls the freight all the way to the carriage paid to point but risk for loss passes when the goods are handled over to the carrier. In many cases this happens at the seller’s warehouse, as the goods are loaded on the truck.

Seller must deliver all the way to the buyers door is responsible for any loss along the way. Buyer takes care of customs clearance. This term is the shipment of replacement parts or when the buyer has little resources to handle international logistics.

Best when used from sellers premises but can also be from the carrier’s terminal at the origin. Unlike FOB, the loading charges come forward from the buyers. Buyers controls ocean and air freight routing or in the use of FCA seller premises door to door.

These terms would include how the goods will be delivered, who pays, who is responsible for insurance, and who handles specific procedures such as loading and unloading. The C term has the seller contract for carriage, but does not assume the risk of loss or damage after the shipment. The main benefit of Incoterms is to reduce risk. Most small business falls under C-terms.

According to Benchmark.com, All of the C terms allow the US exporter to control the export process...