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Liverpool L5 9TF

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Essentials of moving goods from A to B

Posted on 26 May 2016

Essentials of moving goods from A to B

Being aware of some of the essential elements of international logistics and supply chain is important for delivering a successful export strategy.

Alongside agreeing your Terms of Trade and Incoterm of choice there are also other critical waypoints that need to be clearly understood to avoid confusion and potential failure.

DEFINING YOUR LEAD TIME

From a supply chain perspective there are five defined definitions of Lead Time - the point at which the seller provides timescales to the buyer to establish a

delivery schedule.

  • Order - time from customer order received to customer order delivered 

  • Order Handling Time - Time from customer order received to sales order created 

  • Production - time from the start of physical production to production finished (ready for despatch) 

  • Manufacturing - time from sales order created to production finished (ready for despatch)
  • Delivery - time from production completion to customer order delivered

CARGO READY DATE

The Cargo Ready Date is essential to complement the calculation of transit timescales. In the case of Incoterm “EXW” (Ex-Works), knowing the Cargo Ready Date is vital for the buyer so they can arrange their own logistics solution.

DUE DATES

The buyer may set a ‘Due Date’ of when they need to take delivery of the goods, usually prompted by timescales driven further down the supply chain, for instance if their own client (client’s, client) has set a due date. Supply chain scheduling takes precedence in this case.

ESSENTIAL DOCUMENTATION

There are several documents that correlate to each export:

  • Commercial Invoice (provided by the exporter)
  • Packing List (provided by the exporter)

  • Bill of Lading (provided by the forwarder)
  • Any other documents

Supply Chain specialist Andy Simpson, Business Development Director of Warrant Group and a Chartered member of the Chartered Institute of Logistics and Transport, explains:

“For any businesses looking to export, agreeing Incoterms, specific lead time definitions, payment terms and respecting declared due dates are the perfect ingredients to removing export barriers.

If these are not bedded down accurately,
it can lead to confusion, ambiguity and uncertainty. It requires a ‘work backwards’ mentality and a clear understanding of the different points in the exporting cycle.”

 

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