Advantages of DDP for Buyer (Importer)
Is DDP terms benefited for an importer in export import trade? If so up to what extend?
The following post is one of the many posts related to Incoterms 2020.
Under this post we are chewing over the advantages from buyer’s perspective when the delivery terms are on DDP basis.
Here are those advantages to importers under DDP terms one by one:
01. One of the main advantages for importer when moving goods on DDP delivery rules is that the importer under DDP delivery terms undertakes very low risks under movement of goods from seller’s place to his named destination. Except unloading of goods at his place, the buyer undertakes no risks in movement of goods.
02. If the contract of carriage between buyer and seller is under DDP terms, the seller takes care of total movement of goods to the buyer’s place and the buyer does not want to learn or experience government rules and regulations for export at seller’s country. This is an advantage for buyer under DDP terms.
03. Another advantage for importer under movement of goods on DDP delivery rules is that the importer under DDP terms is free from handling local transportation at exporter’s country, government rules and regulations for movement of goods at exporter’s country. The seller is liable to undertake such responsibilities under DDP delivery rules.
04. Under a DDP delivery terms, the buyer is free from undertaking import customs clearance process, import duties and other government regulations on import documentation. All such risks are on the shoulder of seller under DDP terms. Import customs clearance process might be a difficult task for a buyer who does not have experience in handling such activities. Moreover, an inefficient freight forwarder may spoil the business relationship. This is an upper hand for a buyer under DDP contract of carriage.
05. Another advantage for importer under DDP delivery terms is that; since unloading of goods at destination named place is undertaken by the buyer under DDP delivery terms, the buyer can ensure the safety of goods while unloading of goods.
06. One of the other edges for importer under DDP delivery terms is that the importer in export import trade is not responsible for any damage or loss of goods during loading and unloading of goods at different locations of pre carriage, main carriage, port handling or at on carriage points, as the exporter is responsible under DDP terms of delivery.
07. Under DDP terms, if the seller appointed freight forwarder is inefficient to move goods from seller’s place to buyer’s place under DDP terms, the buyer can raise dispute against the seller if delay in delivery of goods happens or any other inconvenience due to such poor service especially under export/import customs clearance processes. This is another advantage for importer when goods are moved under DDP contract of carriage.
You may add your suggestions based on your experience in handling DDP delivery terms.
Share below your thoughts under discussion column below: