Observation

 

Most candidates who attempted this question could not explain the terms of quoting prices in foreign trade.

The expected responses to the question include:
(a)      Items to be Found on an Indent
(i)      Name and address of the principal/Importer
(ii)      Country of the principal/Importer
(iii)     Name and address of the agent
(iv)     Country of the agent
(v)      Description of goods to be bought.
(vi)     Terms of purchase acceptable
(vii)    Who to buy from.
(viii)   Delivery terms
(ix)     Date of indent
(x)      Mode of payment.
(xi)     Signature of the importer.

 

(b)  Explanation of Terms used in Quoting Prices

Free on Board (F.O.B)

The price quoted will cover charges payable for loading goods on the ship and all the cost incurred up to the point of shipment.                                      

Franco                                                                                     

  The price quoted will cover charges for delivery of the goods to the importer’s warehouse.

Cost, Insurance and Freight (C.I.F)                                                                 

The price quoted under this term comprises cost of goods, insurance and freight charges, up to the port of destination.

Free on Rail (F.O.R)

The seller pays for all cost involving movement of the goods from the warehouse to the rail station. The buyer will then bear the remaining cost of delivery to his premises.

Free Alongside Ship (F.A.S)

  It requires the seller to deliver the product alongside a given vessel at a named   port while all other charges are at the buyer’s expense.

Ex-works

  The buyer collects the goods from the seller’s warehouse and pays all the necessary expenses up to his destination.

Cost and Freight (C and F)

The price quoted under this term comprises cost of goods and freight charges up to the port of destination while the buyer bears the insurance cost.