Terms To Know Before Facilitating International Shipments

Terms To Know Before Facilitating International Shipments

  • Avatar photo by Best Inc.
  • 20/09/2020

If you are ready to expand your e-commerce business, one major factor to consider is international shipments. When you offer international shipping, your consumer base is instantly multiplied, growing your business to heights you never could have imagined previously. However, many small business owners can get intimidated by the numerous terms involved in international shipments. Let us lay out the most common ones as well as explain what they mean below.

Terms To Know Before Facilitating International Shipments

Customs Duty

Simply put, customs duty refers to a tax that is payable for products that have crossed international borders. Besides being a way of regulating restricted products, customs duties are imposed in the interests of a country’s economy and environment, amongst many others. While the amount payable varies, it is dependent on certain factors.

  • Country of origin: This refers to the country in which the product was manufactured, not the country in which it was purchased or shipped from.
  • Declared value: The value that is reported to the carrier, which becomes the maximum amount they are liable for in the event of loss or damage.
  • Harmonized system code (HS code): A 6 to 10 digit identification code required for all international shipments, used to determine the taxes payable.

Bill of Landing (BOL)

A BOL is a must-have document for every international shipment, and your product may not be able to cross borders without one! Containing all relevant information about the shipment as well as seller instructions, a BOL is important for the following reasons: acknowledging receipt of a shipment, verifying its origin and destination, documenting the goods contained within it as well as regulating terms of payment.


Short for a set of commercial terms defined by the International Chamber of Commerce, “Incoterms” help to communicate the costs, risks as well as responsibilities undertaken by both the buyer and seller in an international shipment. As they are recognized globally, Incoterms apply to every international shipment you make. Here are what some of the common ones stand for:

  • CIP: Carriage and Insurance Paid.
  • CPT: Carriage Paid To by seller.
  • FCA: Free Carrier. Seller pays for shipment from warehouse to transport hub.
  • ExW: ExWorks. Seller is only responsible for packaging product and transporting it to the shipment hub.
  • DAP: Delivery At Place.
  • DAT: Delivered At Terminal.
  • DDP: Delivery Duty Paid.
  • DDU: Delivery Duty Unpaid.
  • CFR: Cost and Freight, limited to shipping by sea.
  • CIF: Cost, Insurance and Freight, limited to shipping by sea.
  • FAS: Free Alongside Ship, limited to shipping by sea.
  • FOB: Free On Board.

International Shipment Solutions for Your Business

If your business is looking for effective international shipment solutions, look no further than Best Inc. Regardless of the destination, we can get your shipment there in the fastest possible time or the most budget-friendly prices, depending on your requirements. When you engage us at Best Inc., you benefit from the knowledge of experienced supply chain and technology experts.  Please do not hesitate to contact us if you have any queries or would like a custom fulfilment quote.