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Step 16: Handling the export logistics

You are here:Step 16: Handling the export logistics > Sea freight > Sea freight payment terms


 

 

Sea freight payment terms

 

Liner terms

Liner operators quote their freight rates on a liner term basis. A series of highly specialised operations are required in the process of loading cargoes efficiently into a ship, and securing those cargoes in the ship's hold for safe transportation to the port of destination. Another series of equally highly specialised operations must take place in order to extract the cargo from the ship's hold and place them safely on the quayside at the port of destination. All these costs are collectively known as terminal handling charges - THC.

Payment of freight

The word "freight" has two alternative meanings: it may be used to refer to the movement of the cargo; by road, rail sea or air, or it may be used to denote the charge raised by the carrier for the service of transportation.

Freight currency

In the context of international carriage by sea, the "tariff currency", is the United States Dollar. It is common practice in the shipping industry that freight is payable as the consignment/cargo is loaded on board the intended vessel.

Immediately the cargo has been placed on board, the shipping company is entitled to full payment, even though the ship may sink along the quayside at the loading berth. The amount of freight due is paid either at the port of loading in exchange for the issuance of the original bills of lading, or at the port of discharge in exchange for the release of the consignment from the shipping company's custody. When freight is paid in any currency other than the "tariff currency", the amount due in that "tariff currency", will be converted at the rate applicable on the date of shipment or such other date as agreed upon by the carrier.

 
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Step 16: more information

Step 16: Handling the export logistics
      Sea Freight
             .Sea Freight calculations
      Air Freight
      Rail Freight
      Road Freight
      River Freight
      Containerisation

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More information on Step 16
Learning to export...
The export process in 21 easy steps
Step 1: Considering exporting
Step 2:Current business viability
Step 3:Export readiness
Step 4:Broad mission statement and initial budget
Step 5:Confirming management's commitment to exports
Step 6: Undertaking an initial SWOT analysis of the firm
Step 7:Selecting and researching potential countries abroad
Step 8: Preparing and implementing your export plan
Step 9: Obtaining financing for your exports
Step 10: Managing your export risk
Step 11: Promoting the firm and its products abroad
Step 12: Negotiating and quoting in exports
Step 13: Revising your export costings and price
Step 14: Obtaining the export order
Step 15: Producing the goods
Step 16: Handling the export logistics
Step 17: Export documentation
Step 18: Providing follow-up support
Step 19: Getting paid
Step 20: Reviewing and improving the export process
Step 21: Export Management
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