International LogisticsInternational Logistics

Presented by:Delhy Arias

Marbell LastraMaria J Zavala

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Definition of International Definition of International LogisticsLogistics

The negotiating, planning, and implementation of supporting logistic arrangements between nations, their forces, and agencies.

It includes planning and actions related to the utilization logistic policies, systems, and/or procedures to meet requirements of one or more foreign governments, international organizations, or forces.

Government InfluencesGovernment InfluencesPolitical Restrictions

of Trade◦ Tariffs◦ Nontariff barriers

Import quota

◦ Embargoes As of October, 2007, the

United States has sanctions against: China, Ivory Coast, Cuba, Democratic Republic of the Congo , Iran, Myanmar, Sudan, Syria, Venezuela, and Zimbabwe

International Transport◦ Cargo preference rules

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Challenges Challenges

Economic Conditions◦ Currency Changes

Laws, Regulations, and Legal systems

Cultural Considerations◦ Language ◦ National Holidays

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Exporting RequirementsExporting RequirementsShipping a product overseas

◦Packing◦Labeling◦Documentation◦Insurance requirements

Note: Most exporters rely on an international freight forwarder to perform these services because of the multitude of considerations involved in physically exporting goods

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PackingPacking

Reasons Used Guidelines

◦ Move goods easily through customs

◦ Protect Products

Pack in strong containers, adequately sealed and filled when possible.

Make sure the weight is evenly distributed.

Goods should be palletized and when possible containerized.

Packages and packing filler should be made of moisture-resistant material.

To avoid pilferage, avoid writing contents or brand names on packages. Other safeguards include using straps, seals, and shrink wrapping.

Observe any product-specific hazardous materials packing requirements.

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LabelingLabeling

Reasons Markings on cartons to be shipped

Meet shipping regulations

Ensure proper handlingConceal the identity of

the contentsHelp receivers identify

shipments Insure compliance with

environmental and safety standards

Shipper's mark Country of origin Weight marking Number of packages

and size of cases Handling marks Cautionary markings,

such as "This Side Up" or "Use No Hooks"

Port of entry Labels for hazardous

materials

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DocumentationDocumentationAir waybillsBill of lading Commercial

invoiceConsular invoice Certificate of origin NAFTA certificate

of origin Inspection

certification

Dock receipt and a warehouse receipt

Destination control statement

Shipper's Export Declaration(SED)

Export license Export packing listInsurance

certificate 8

InsuranceInsuranceReasonsDamaging weather

conditionsRough handling by

carriers,Other common

hazards to cargo Type of coversMarine cargo

insurance Cargo insurance

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Schedule B and HS Schedule B and HS NumbersNumbers

The Harmonized System (HS) ◦Assigns 6 digit number ◦4 additional numbers (by country)◦10 Digits total

US use Schedule B system◦Based on the international HS system

http://www.census.gov/foreign-trade/aes/exporttraining/videos/uscs_videos/Classifying_your_commodity/index.html

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Schedule B and HS Schedule B and HS NumbersNumbersReasonsTo determine applicable import

tariff rates and whether a product qualifies for a preferential tariff under a Free Trade Agreement;

The Schedule B number is needed to complete the Shipper’s Export Declaration, Certificates of Origin and other shipping documents; and

The HS Number may be needed on shipping documents, such as certificates of origin

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Incoterms 2000Incoterms 2000(International Commercial Terms)(International Commercial Terms)What are they?

◦ A series of international sales terms published in 2000 by the International Chamber of Commerce (ICC)

◦ From the seller’s viewpoint: the different locations for quoting a price to an overseas buyer

How are they useful?◦ Widely used in international commercial

transactions◦ Used to divide transaction costs &

responsibilities between buyer & seller◦ Reflect state-of-the-art transportation practices

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Incoterm Groups Incoterm Groups (13 terms)(13 terms)Group E – Departure

◦EXW (Ex Works)Group F – Main carriage unpaid

◦FCA, FAS, FOBGroup C – Main carriage paid

◦CFR, CIF, CPT, CIPGroup D – Arrival

◦DAF, DES, DEQ, DDU, DDP

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Group EGroup EEXW – (Ex-Works) named place

where shipment is available to the buyer, not loaded.The seller will not contract for any transportation.

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Group FGroup FInternational Carriage NOT Paid by Seller

FCA – (Free Carrier) seller is responsible for arranging transportation to a specific carrier at a named place; suitable for all modes of transport

FAS – (Free Alongside Ship) seller must arrange for delivery, and assume all risks, up to the ocean carrier at a port. Delivery is ‘within reach of ship’s tackle’

FOB – (Free On Board vessel) only for carriage by water; the point of title transfer occurs when the goods have passed over the ship’s rail

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Group CGroup C International Carriage Paid by the Seller

CFR – (Cost and Freight) seller must deliver over the ship’s rail, assuming risks. Once loaded, risk transfers to buyer. Cargo insurance from port of loading is not included. For waterborne shipments only.

CIF – (Cost, Insurance and Freight) seller retains risk of loss up to the foreign port of unloading. For waterborne shipments only.

CPT – (Carriage Paid To) seller will pay all freight costs all the way to the foreign port; buyer assumes all risk of loss beyond the loading port. For all modes of transport.

CIP – (Carriage and Insurance Paid To) similar to CIF; used in multimodal transactions. Place of receipt & delivery may be different from port of loading or unloading

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Group DGroup D Arrival At Stated Destination

DES – (Delivered Ex-Ship) seller pays all costs & bears all risks of transport up to foreign port of unloading, except cost or risk of unloading cargo from ship

DEQ – (Delivered Ex-Quay) similar to DES; seller pays the costs of unloading the cargo from the vessel and the cost of import clearance

DAF – (Delivered At Frontier) seller’s responsibility is to deliver goods to a named frontier (border crossing point) & clear the transaction for export. Buyer’s responsibility is to arrange for pickup of goods after cleared for export, carry them across border, clear them for importation, and pay duties

DDP – (Delivered Duty Paid) Seller pays everything to the buyer’s warehouse door and passes on all related costs in the merchandise price

DDU – (Delivered Duty Unpaid) similar to DDP except duty is not paid

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Tariffs and Imports fees Tariffs and Imports fees Tariff is a tax set by governments

on the value of products imported from one country into another.

Tariffs are assesses before importing the product.

Types of Tariffs:◦Sales and state taxes, ◦Customs fees

Tariffs and Imports fees Tariffs and Imports fees (cont.) (cont.) Steps to determine the Tariff Rate

◦Step 1: Determine your HS or Schedule B Number

◦Step 2: Determine Tariff Rates Country Specific Tariff and Tax information U.S. Government Tariff Resources for

Agricultural Exports Online Tariff Database provided by Customs

Info LLC . Review Export. Government’s disclaimer Tariff and Tax Information for U.S. Territories Sending Gifts Additional Tariff Resources

Common Export Common Export DocumentsDocumentsThere are commonly Export

Documents used in exporting, but specific requirements vary by destination and product.◦Airway Bill◦Bill of Landing◦Commercial Invoice◦Export Packing List◦Electronic Export Information Form

Certificate Of OriginCertificate Of OriginThe Certificate of Origin (CO) is

required by some countries for all or only certain products.

The exporter should verify whether a CO is required with the buyer and/or an experienced shipper/freight forwarder or the Trade Information center.

Most common are Certificate of Origin for claiming benefits under Free Trade Agreements

OTHER CERTIFICATESOTHER CERTIFICATESCertificate of AnalysisCertificate of Free SaleDangerous Goods CertificateFumigation CertificateHealth CertificateIngredients Certificate

International TradeInternational TradeDefined as

economic transactions that are made between countries.

International trade transactions are facilitated by international financial payments, in which the private banking system and the Central Banks of the trading nations play important roles.

Trade AgreementsTrade AgreementsThe purpose of US Trade Agreements is

to create opportunities for Americans and help to grow the U.S. economy.

Administering trade agreements involves:◦Monitoring the trading partners’

implementation.◦Negotiating and signing trade agreements

that advance the President's trade policyAn important type of trade agreement is

the Trade and Investment Framework Agreement (TIFAs)

International Logistics International Logistics Agencies ExamplesAgencies Examples

World Courier: ◦Private Company handling Specialty &

Custom Shipment

USPS:◦Government Agency handling mail and

parcel

FedEx:◦Public Company handling a variety of

shipping needs25

World CourierWorld CourierLargest most successful specialty courier in

the worldAreas of Service:

◦ Clinical trial logistics◦ Clinical trial supply storage◦ Cold Chain Solutions◦ Courier services:

Advertising & media Aircraft on Ground Automotive Biopharm Food HighTech

Serve in 50 Countries, 140 offices26

USPSUSPS(United States Postal Service)(United States Postal Service) Independent agency of the U.S. Government

Responsible for providing postal service in U.S.

Second largest civilian employer in U.S. after Wal-Mart

Has contractual agreement with AmTrak and various airlines for mail and package delivery

Offers international services to over 190 countries, including ship letters and packages with the aid of FedEx

International Parcel Shipments:◦ Maximum weight: 70 pounds ◦ Maximum length + girth: 130 inches ◦ Costs almost triple for Parcel Post shipments that are

"oversized" (Length + girth is greater that 108 but less than 130 inches) 27

USPS Mail Flow Through National USPS Mail Flow Through National InfrastructureInfrastructure

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FedExFedEx Headquartered in Memphis, Tennessee

Offers international services to over 220 countries

Strong ties to the White House and members of Congress allow access to international trade and tax cut debates as well as the rules of the business practices of the United States Postal Service

In 2001, FedEx sealed a $9 billion deal with the USPS to transport all of the post office's overnight and express deliveries

International Next Flight Urgent shipments:◦ Up to 2,200 lbs. per piece (or more with prior

approval). Unlimited total shipment weight

Other International parcel shipments:◦ Up to 150 lbs. each (unlimited total shipment weight),

108" in length, 130" in length plus girth (L+2W+2H)29

FedEx International Service, FedEx International Service, Simplified.Simplified.

http://www.youtube.com/watch?v=iIODEoEx1HU

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Work CitedWork Cited

http://www.unzco.com/basicguide/toc.html http://www.export.gov/logistics/index.asp http://www.i-b-t.net/incoterms.html http://www.worldcourier.com/Global/indexHome6centerFlash

3grt.html http://www.usps.com/international/sendpackages.htm http://en.wikipedia.org/wiki/United_States_Postal_Service http://www.fedex.com/international/ http://en.wikipedia.org/wiki/FedEx http://www.uship.com/freight/articles/parcel-weight-restrictio

ns/ http://www.thefreedictionary.com/international+logistics http://www.export.gov/logistics/eg_main_018130.asp http://www.export.gov/logistics/eg_main_018121.asp#P10_6

41 http://www.britannica.com/EBchecked/topic/291349/internati

onal-trade http://www.ustr.gov/trade-agreements 31

QuestionsQuestions

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