What is CIF sale terms?
Cost, insurance, and freight (CIF) is an international shipping agreement, which represents the charges paid by a seller to cover the costs, insurance, and freight of a buyer’s order while the cargo is in transit. The goods are exported to the buyer’s port named in the sales contract.
Whats CIF stands for?
cost, insurance and freight
The abbreviation CIF stands for “cost, insurance and freight,” and FOB means “free on board.” These are terms are used in international trade in relation to shipping, where goods have to be delivered from one destination to another through maritime shipping.
What is CIF and FOB terms?
Meaning: FOB means free on board. The price includes all the expenses incurred until goods are actually loaded on board the ship at port of shipment. CIF stands for cost, insurance and freight. CIF price includes free on board and charges of Freight and marine insurance.
Which is better FOB or CIF?
It is advised to go with the FOB option for shipping as the buyer gets control over the shipping process and the costs are comparatively cheaper. Whereas in CIF shipping, since the seller has the authority over shipping charges and arranging a ship with the help of a freight forwarder, the cost is higher.
Whats CIF price?
CIF (CFR) – Cost, Insurance and Freight – The seller pays for everything up to and including the freight to a named destination port, the first charge to the buyer is the terminal handling at the destination port.
Does CIF include duty?
CIF charges do not affect customs charges. The buyer still has to pay customs duty whether shipping is done through CIF or the Free On Board model (FOB). The buyer can negotiate a better price for freight than the seller who might be looking to make extra profit.
How do you quote CIF price?
Cost, insurance, and freight to a named overseas port. The seller quotes a price for the goods (including insurance), all transportation, and miscellaneous charges to the point of debarkation from the vessel. (The term is used only for ocean shipments.)
Is custom duty included in CIF value?
Does CIF include duty? CIF includes duty and charges, where the seller assumes responsibility for export customs proceeding and the buyer for import customs.
Does CIF price include duty?
CIF includes duty and charges, where the seller assumes responsibility for export customs proceeding and the buyer for import customs.
When does the seller pay for CIF insurance?
In CIF terms, the seller clears the goods at origin places the cargo on board and pays for insurance until port of discharge at minimum cover. Even though the seller pays for insurance during the main carriage, the risk is transferred to the buyer at time the goods are on board.
What does the CIF stand for in Incoterms?
Incoterms CIF is short for “Cost, Insurance and Freight.” Under CIF Incoterms, the seller delivers goods onboard the vessel at the port of shipment, pays for transport and minimum insurance coverage.
How are CIF sales different from FOB sales?
So, with cif sales, the seller pays transportation to the buyer’s nominated port and normally title passes there. With fob sales, the seller pays transportation to the vessel and title passes once on board. These are general practices, not rules of law.
How does cost, insurance, and Freight ( CIF ) work?
Cost and Freight (CFR), like CIF, requires the seller to pay the costs and freight necessary to transport goods to the named port of destination. Risk responsibility for lost or damaged goods, as well as any additional costs, gets transferred from the seller to the buyer once the goods are onboard the ship in the port of shipment.