International Logistics

Presented by:
Delhy Arias
Marbell Lastra
Maria J Zavala
1
 Definition of International Logistics
The Itincludes planning and
negotiating,
planning, and actions related to the
implementation of utilization logistic
supporting logistic policies, systems,
arrangements between and/or procedures to
nations, their forces, meet requirements of
and agencies. one or more foreign
governments,
international
organizations, or forces.
Government Influences
 Political 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

3
 Challenges
Economic Conditions
◦ Currency Changes
Laws, Regulations,
and Legal systems
Cultural
Considerations
◦ Language
◦ National Holidays

4
Exporting Requirements
Shipping 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

5
Reasons Used Guidelines

◦ Move goods easily through

 Pack in strong containers, adequately
sealed and filled when possible.
customs  Make sure the weight is evenly
◦ Protect Products 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.

Packing
6
 Reasons Markings on cartons to be shipped

 Meet  Shipper's mark

shipping regulations
 Ensure proper handling
 Conceal the identity of the
contents
 Help receivers identify
shipments
 Insure compliance with
environmental and safety
standards
 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

Labeling
7
Documentation
Air waybills Dock receipt and a
Bill of lading warehouse receipt
Commercial invoice Destination control

Consular invoice statement

Shipper's Export
Certificate of origin
NAFTA certificate of
Declaration(SED)
Export license
origin
Export packing list
Inspection
Insurance certificate
certification

8
Insurance
Reasons
Damaging weather
conditions
Rough handling by
carriers,
Other common hazards
to cargo
Type of covers
Marine cargo insurance
Cargo insurance

9
 Schedule B and HS Numbers
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

10
Schedule B and HS Numbers
Reasons
To 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

11
Incoterms 2000
(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

12
Incoterm Groups
(13 terms)
Group E – Departure
◦ EXW (Ex Works)
Group F – Main carriage unpaid
◦ FCA, FAS, FOB
Group C – Main carriage paid
◦ CFR, CIF, CPT, CIP
Group D – Arrival
◦ DAF, DES, DEQ, DDU, DDP

13
Group E
EXW – (Ex-Works) named place where
shipment is available to the buyer, not
loaded.
The seller will not contract for any
transportation.

14
Group F
International 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
15
 Group 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
16
 Group 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

17
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 (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 Documents
There 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 Origin
The 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 CERTIFICATES
Certificate of Analysis
Certificate of Free Sale
Dangerous Goods Certificate
Fumigation Certificate
Health Certificate
Ingredients Certificate
International Trade
 Defined 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 Agreements
The 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 policy
An important type of trade agreement is the
Trade and Investment Framework
Agreement (TIFAs)
International Logistics Agencies
Examples
World Courier:
◦ Private Company handling Specialty & Custom
Shipment

USPS:
◦ Government Agency handling mail and parcel

FedEx:
◦ Public Company handling a variety of shipping
needs
25
 World Courier
 Largest most successful specialty courier in the world
 Areas 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 offices

26
USPS
(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
Infrastructure

28
FedEx
 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,
Simplified.
http://www.youtube.com/watch?v=iIODEo
Ex1HU

30
 Work 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/indexHome6centerFlash3grt.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-restrictions/
 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_641
 http://www.britannica.com/EBchecked/topic/291349/international-trade
 http://www.ustr.gov/trade-agreements

31
Questions

32