Read the following question carefully and pay attention to all the details. Explain your answer clearly.

Think about you are working in a supply company. In this company, you will supply a container of chemicals from China.Your company cares a lot to on-time delivery and short lead time. But the supplier has a bad reputation of choosing "low cost" and "low quality" service providers for logistics. The supplier has a fair and variable price list based on different shipment alternatives and ıncoterms. Which incoterms would you prefer in case the goods are delivered in container by ocean(or sea)in order to supply the goods in line with your priorities?

Let’s assume you are working in a Small-Medium Enterprise in New York. Your company would like to supply from Nigeria again from another Small-Medium Enterprise. There is no prior transaction between these two companies. The transaction amount is around 100K USD. 

a) What kind of payment method would you choose? Why? 

b)What are the risks of the method you choose? Why? 

c)What are the advantages of the method you choose?

Why?

 

EXW FCA FAS FOB CFR CIF CPT CIP DAT DAP DDP FACTORY hth FIRST CARRIER EX WORKS AGREED PLACE FREE CARRIER ALONGSIDE SHIP ON BOARD AGREED PLACE FREE ALONGSIDE SHIP O PORT OF SHIPMENT ON ARRIVAL ALONGSIDE DESTINATION SHIP PLACE 1 IL FREE ON BOARD PORT OF SHIPMENT COST AND FREIGHT COST, INSURANCE AND FREIGHT PORT OF DESTINATION PORT OF DESTINATION DELIVERY AT TERMINAL BUYER WAREHOUSE COST PAID TO... PLACE OF DESTINATION CARRIER AND INSURANCE PAID TO... PLACE OF DESTINATION O PLACE OF DESTINATION PLACE OF DESTINATION DELIVERY DUTY PAID O DESTINATION DELIVERY AT PLACE