AGENDA
10.1 Introduction
10.2 Handling export order
10.3 Structure of international physical distribution
10.3.1 Modes of transportation
10.3.2 Facilitating organizations & services
10.3.3 Documents required
(i) Bill of Lading (ocean)
(ii) Air waybills (air shipments)
10.0 Introduction
• The success or failure of the export business of a firm
depends entirely upon securing orders from buyers,
delivering products in s good condition at the correct
time.
• This depends upon the correct handling of export
procedures.
• All documents and procedures must be carefully
followed in order to avoid violations of laws of the
countries involved.
10.1 The Export Procedure
Importer (Inquiry)
Exporter (Response)
Make general inquiry
Sends catalogs & price list
Requests pro forma invoice
(price quotation)
Sends pro forma invoice
Sends Purchase Order (P.O)
Receives P.O
Directly from
prospective importer
Order Received
From branch or
representative overseas
10.3 Structure of International
Physical Distribution
• To facilitate the flow of products across countries there
has evolve a complex structure of specialized marketing
institutions, organizations and services.
10.3.1 Modes of Transportation
Ocean
Air
Rail
Truck
Inland Water
Pipeline
10.3.2 Facilitating Organizations & Services
(a)
(b)
(c)
(d)
(e)
Freight forwarders
Warehousing
Free areas
Transportation insurance
Export packing
(a) Freight Forwarder
Forwarding of an export shipment from the point of origin to
the ultimate destination in some foreign market.
(b) Warehousing
A warehouse is a commercial building for storage of goods.
(c) Free Area
An enclosed, policed area without resident population in,
adjacent to, or near a port of entry, into which foreign goods.
Two types of free area:
(i) free port
(ii) free perimeter
(d) Transportation Insurance
To protect goods from lost and damage during physical
movement from seller to buyer.
(e) Export Packing
To deliver the commodity in good condition to the
foreign customer.
10.3.3 Documents Required
(a) Export license
(b) export declaration
(c) Commercial invoice
(d) Consular invoice/special custom invoice/ facture
(e) Packing list
(f) Certification and other documents
(a) Export license
Prepared by the
exporter, given to the
shipping company,
then filled with
customs officials at
the port of exporter.
(b) Export
declaration
Includes complete
information about
the shipment.
.
(c) Commercial
Invoice
The bill that the
exporter(consignor)
sends to the
importer(consignee).
To calculate tariff.
(d) Consular invoice/
special custom
service/ facture
Obtained by the
exporter of home
country from the
governmental
representative of the
importer’s country.
(e) Packing List
Usually attached to a
commercial invoice.
Provides additional
details on goods
being shipped
overseas if it is not
shown in the
commercial invoice.
(f) Certificate of
Origin
Certifying the
place of origin of
the merchandise.
(i) Ocean Transportation & Bill of Lading
Three purpose of ocean Bill of Lading (BOL):
1. A contract of carriage between shipper and
transportation company.
2. Receipt of goods issued by steamship company.
3. Evidence of title to merchandise.
Selecting the Route of an Ocean Shipment
Two major factors:
1. The route that bring the shipment to its port of
destinations in the shortest time.
2. The route which is more economical.
Freight rates and space reservations
• The shippers will sign a contract which has lower rates.
• Usually sailing schedules to destination always unknown.
Therefore, contract with foreign freight forwarder will
make space reservation at no cost.
Container shipment
• Fill the dock before load in vessel.
Dock receipt
• If not noted any in dock receipt, means goods in good
condition of container and vice versa.
Types of Bill of Lading (BOL)
 Straight BOL
 Open BOL
 Shipped BOL
 Stale BOL
 Through BOL
 Groupage BOL
 Transhipment BOL
 Ocean BOL
 Claused BOL
 Electronic BOL
Short Form Straight
Bill of Lading
Ocean Bill of Lading
Open Bill of Lading
Electronic Bill of Lading
(ii) Air Shipments & Air Waybills
• Air waybill is used for air transport and is documentary
evidence of the conclusion of a contract for carriage.
Air waybill
It serves as:
•Proof of receipt of the
goods for shipment;
•An invoice for the freight;
•A certificate of insurance;
•A guide to airline staff for
the handling, dispatch
and delivery of the
consignment.