Importing to Australia with Ex Works (EXW) terms | Vince Barnes & Rob Naumovski

Intergroup Australia's Managing Director Vince Barnes & Freight Manager Rob Naumovski took some time out to discuss what the "Ex Works" Incoterm rules imply for Australian Exporters and Importers of goods.
We often encounter businesses that mistake Incoterm rules or terminology when shipping their goods, so this video is intended to clarify the, often subtle, but important differences between Ex Works and other Incoterm methods of carriage.

The International Chamber of Commerce (ICC) established Incoterms in 1936 to promote open markets and ensure global economic prosperity through trade.
Essentially, Incoterms are a set of guidelines that help Buyers (Consignees) and Sellers (Consignors) by providing a common language that can be used to set terms of trade.
Activities that call for the use of Incoterms include; filling out purchase orders, labeling shipments for transport, and completing certificates of origin.
Incoterms are updated periodically to conform to changing trade practices.

Under the Incoterm Ex Works (EXW), a seller is only required to make goods available for pickup at a specified location.
EXW specifies that the buyer assumes all the risk and transportation costs, but is given the flexibility to specify their own logisitcs partners for goods transportation and storage downstreram, rather than be obliged to use vendors that the Consigor forces them to partner with.
Because of this flexibility, the Consignee is often in a stronger position to keep costs down and iron out kinks in the delivery system.

To note:

Incoterms do not preclude contracts, insurance and other liability agreements, but they do, however, allow logistics experts to speak in shorthand to get goods from location to location in the most business appropriate way.

Incoterms do not :
-address all sale conditions
-Specify customs clearance processes
-Identify the goods being sold
-Reference the methods or timings of payments
-Address liability for contract failures
-Determine when the title, or ownership of the goods, passes from the seller to the buyer

Incoterms omit certain sale conditions, so all parties involved in any contract should make sure to address the above conditions contractually.
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Intergroup Australia is an Australian owned & operated freight forwarder headquartered in Melbourne. We have a focus on technology, people & exceeding client expectations.

Drop us a line for advice specific to your business:
Ph. +61 03 9326 8344

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*Intergroup Australia advises all information contained in this video is general in nature and should not be considered to be formal, legal, consulting or professional advice.
Chapters:
0:00 - Intro to Rob Naumovski & Vince Barnes
0:40 - About Incoterms
1:30 - Ex Works: how the consignee controls the product journey
2:52 - What do clients control under Ex Works Incoterms?
3:35 - Required documentation under Ex Works
5:15 - Costs incurred upon goods arrival in Australia
6:20- What can look economical at first can cost $1000s more
7:00 - Machine import client example: unitized goods can save a fortune
9:10 - Suppliers have local relationships but destination costs can skyrocket
9:56 - A furniture company was able to save with local control
10:44 - Closing

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