Minimum delivery risk, which Inco term is better for buyer?

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Best delivery terms for Importer under Inco Terms

Comparing risks and costs from buyer’s point of view

While understanding the risks and costs involved in movement of goods under Inco Terms, every importer realizes that the safest delivery terms among 11 Inco Terms 2020 is DDP terms with minimum risks for a buyer.

Why is DDP terms the safest rule for an Importer (buyer)?. 

As you are aware, under DDP terms of delivery, the risks and costs to move the goods from seller’s place to buyer’s place is minimum.  So the responsibility to deliver the goods to the importer’s premises from the exporter’s place is with the Seller. 

In an export import business, under DDP terms, the exporter bears all the risks and costs involved to deliver the goods to importer at his country.  The exporter undertakes the responsibility of packaging goods, pre carriage, export documentation, export customs clearance, main carriage, destination port handling expense, import customs clearance process, import taxes if any and on carriage from destination port of discharge at importer’s country to the importer’s premises or the named place mentioned in the contract of carriage mutually agreed.  Here, except unloading of goods at buyer’s premises all risks and costs are on account of Seller thereby, the term DDP terms of delivery is treated as best method of Inco terms from the point of view of Importer (Buyer). 

Since the risks in movement of goods from seller’s place to buyer’s place are very less, DDP terms of delivery is best for a buyer.  However, if a buyer is familiar with the costs and risks of movement of goods at Seller’s country, Government regulations on export process at exporter’s country,  cost and risk involved in main carriage,  customs regulations and port handling experience in importing country and on carriage knowledge and experience,  he can  contract with other terms as I  say – Risk plays major role in Profit under business.

In short, if an importer does not want to undertake more risks for movement of goods, DDP is the best delivery terms for him.

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