Cost-Ins.-Freight (CIF)Cost, Insurance, and Freight (CIF)
Commonly Used Terms
It is important to understand and use sales terms correctly. A simple misunderstanding may prevent you from meeting contractual obligations or make you responsible for shipping costs you had sought to avoid.
When quoting a price, make it meaningful to the prospective buyer. For example, a price for industrial machinery quoted “EXW Saginaw, Michigan, not export packed” would be meaningless to most prospective foreign buyers. These potential customers might find it difficult to determine the total cost and, therefore, might hesitate to place an order. You should quote CIF or CIP prices whenever possible, to show the foreign buyer the cost of getting the product to or near the desired destination.
If possible, quote the price in U.S. dollars. This will eliminate the risk of exchange rate fluctuations and problems with currency conversion.
If you need assistance in figuring CIF or CIP prices, an international freight forwarder can help. You should furnish the freight forwarder with a description of the product to be exported and its weight and cubic measurement when packed. The freight forwarder can compute the CIF price, usually at no charge.
|U.S. Commercial Service international trade specialists can provide additional help with understanding the definitions and uses of export shipping terms.|
Cost, Insurance, and Freight (CIF)
Cost, insurance, and freight to a named overseas port. The seller quotes a price for the goods (including insurance), all transportation, and miscellaneous charges to the point of debarkation from the vessel. (The term is used only for ocean shipments.)
Cost and Pricing