Why Are Incoterms® Important?
Clear and concise language is one of the most important tools of global trade, so small changes in wording or uncertainty can have a major impact on aspects of any business transaction.
With language posing a risk in any foreign trade agreement, INCOTERMS® are used globally to manage this risk. Each INCOTERM® refers to a type of agreement for the purchase and shipping of goods internationally. Some of the most important things to consider are:
- Costs: who is responsible for expenses involved at a given point in the shipment’s journey?
- Control: who owns the goods at a given point in the journey?
- Risks: who is responsible for the goods at a given point in a shipment’s journey?