As part of this explanation the management team must calculate the weight break in pricing for the different modes of shipment along with the factors that affected the shipping rates for each mode. All risks associated with the entire shipment must be identified and assessed. The predetermined Incoterms used and referenced in the Purchase Order created in Project 1 should be reiterated and explained. In conjunction with the risk and Incoterm assessment, the type and amount of insurance that will be obtained to cover the associated risks must be provided.

NOTE: for the purpose of this project the only incoterms that may be used are: -EXW -FCA -FAS