Home – New Forums Logistics FCA vs EXW

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  • #999592
    aaronf
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    Hi people, very new at this so please bare with me.. ha

    At the moment i have a supplier in China who can deliver to freight forwarder’s warehouse in China.
    What i want to know before i pester the freight forwarder with “silly questions”?

    FCA, meaning the freight forwarder handles clearance and taxes from China-Australia and bills me accordingly, right?

    I haven’t looked into EXW but this may be another path as i am assuming companies who offer this must also offer some insurance options?

    Thank you Aaron, many more questions are likely to follow sorry.

    #1220398
    Felicity Metcalf
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    Hi Aaron, you’re right with regards to FCA terms, difference to Ex Works is that FCA your supplier is responsible for the local transport to your forwarder. Ex Works would mean your forwarder would also need to arrange pick up of goods from your suppliers warehouse and bill you accordingly.
    I would suggest trying to negotiate FOB terms (to the port you wish to ship from) ie FOB Shanghai, this way the supplier is responsible for all costs in China up to when the goods pass over the boats rail. then your forwarder will just bill you for freight, and local clearance, customs and delivery costs in Australia (note your suppliers price would be updated to reflect this, but I find it then a little easier to cost out your product)
    Good Luck!
    Felicity

    #1220399
    aaronf
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    Thanks for the reply.
    I have been in contact with my FreightForwarder, they have recommended EXW and are currently working on a quote for me.

    Reasons they suggested this is “Its little technical as some times shippers don’t pay fees for terminal charges etc in China.”
    Is this very common?

    #1220400
    Felicity Metcalf
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    That’s interesting? Perhaps they are recommending Ex Works v FCA? Personally I shy away from either of these 2 options, as I prefer to have one price out of China and then know I am just costing for import freight, local clearance, duty/customs & delivery in Aus. I find it messy costing for local charges in China with quotes in different currency for China charges, USD for freight, then AUD for local charge on arrival. In saying that if your supplier will only quote FCA or Ex Works then go with Ex Works (negotiate a cheaper price to allow for the fact that they no longer will have to pay the trucking in China)
    I would also recommend getting quotes from more than one forwarder – keep them honest :P

    #1220401
    aaronf
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    The supplier is happy with either, it’s the Australian Forwarding company who have suggested EXW.

    How easy is it to arrange FOB? liaising between Supplier and Forwarding company?

    #1220402
    Felicity Metcalf
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    Arranging which terms you agree to is easy, you just need to make sure that they suit you. The forwarder could be right in that FCA may result in some suppliers in China not paying the terminal charge, I’d take their word for that. But personally I prefer FOB as I find it easier to manage my costings, I guess it depends on how often you’re importing, and how diligent you will be with checking invoices against your rates? If you ship FOB and supplier is responsible for the costs in China then you don’t have to check or think about those costs as they are already built into your price. Liaising with your supplier & forwarder won’t be much different regardless of the terms – it’s more to do with who pays for what and who organises which part of the shipment. FOB your supplier will just book with your forwarder for the intended vessel then they have to be responsible for getting the goods to the forwarder in time to make the shipment. If it’s Ex Works then your forwarder takes over the responsibility on your behalf. Happy to chat to you on the phone if you’d like?

    #1220403
    Paul – FS Concierge
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    Hi And Welcome to Flying Solo [USER=115099]@aaronf[/USER] and [USER=113733]@Felicity Metcalf[/USER] .

    It is great to have you both!

    Thank you for joining our community and posting.

    Cheers

    #1220404
    aaronf
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    hey guys, got the help i needed.
    Thanks

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