OPER8060 Lab Exercise Week 4 "George is working on setting up a new vendor (exclusive distribution rights within Canada) and we have reached a crossroad in the negotiations. The value of the product (per shipment value) is $ 150,000.00. We have requested that the shipments exit their facility in Alliston, Ontario "FOB destination" being flexible with Freight Prepaid, Freight Collect and Freight Collect & Allowed. They have countered with FCA - Free Carrier (named place of delivery), to our plant in Kitchener, ON. Our concern is in the values ($$) being shipped as the vendor stated that the shipment weight will not cover the value of the goods and insurance will need to be obtained for all shipments. Negotiations have broken down. How can you help us resolve this situation?" 1) What trade terms have been identified in this story? 2) Why is the reference to "shipment weight" important? 3) What exposure/risk does the buyer have with FCA - Free Carrier (named place)? Where does title transfer? 4) What exposure/risk does the seller have with FOB Destination? Where does title transfer? 5) Are there any other trade terms that the buyer should be considering? Why? 6) Do you have any recommendations that can be used to find a common ground in the negotiations? 7) Should the buyer approach their own insurance company to ask for advice? Why? What might they recommend? OPER8060 Lab Exercise Week 4 "George is working on setting up a new vendor (exclusive distribution rights within Canada) and we have reached a crossroad in the negotiations. The value of the product (per shipment value) is $ 150,000.00. We have requested that the shipments exit their facility in Alliston, Ontario "FOB destination" being flexible with Freight Prepaid, Freight Collect and Freight Collect & Allowed. They have countered with FCA - Free Carrier (named place of delivery), to our plant in Kitchener, ON. Our concern is in the values ($$) being shipped as the vendor stated that the shipment weight will not cover the value of the goods and insurance will need to be obtained for all shipments. Negotiations have broken down. How can you help us resolve this situation?" 1) What trade terms have been identified in this story? 2) Why is the reference to "shipment weight" important? 3) What exposure/risk does the buyer have with FCA - Free Carrier (named place)? Where does title transfer? 4) What exposure/risk does the seller have with FOB Destination? Where does title transfer? 5) Are there any other trade terms that the buyer should be considering? Why? 6) Do you have any recommendations that can be used to find a common ground in the negotiations? 7) Should the buyer approach their own insurance company to ask for advice? Why? What might they recommend
