When we have a shipment from around the globe, we have to check first all the costs of shipment comprehensive. Not all shipment with any trade term is cheaper than other. It all depends on the port of loading and the quantity of our shipment, and the shipment mode, too.
Sometimes, FOB term is more expensive than CIF when the shipment is by air.
I want to put here my experience regarding shipment from China by sea with the CIF trade term. When we don't mention the trade term in our order sheet, they will automatically decide the term is CIF. The sound is so great, means shipper will pay the shipment cost until port of discharge, and the Insurance fee is included.
It's several years ago. The time was coming to us to clear the goods here, in Indonesia port. It's not a big volume, was arranged by LCL. We were so shocked watching the invoice unusual and maybe unreasonable. The local charges in Jakarta port were very expensive.
I tried to check to the forwarder and warehouse why did the cost so high. I got the information from them that, they got an offer to handle our shipment with the high price, too. They advised us to check directly to the origin. After I checked to the shipper, they didn't know too, why the cost was so high.
I asked the forwarder to give us a discount. They then were willing to give us a discount with a requirement, that we had to make a contract with them, would use their service.
This case gave us a warning to use CIF trade term for sea shipment from China especially for LCL shipment.
I don't now until know, to whom should I blame on. Is it forwarder or shipper?
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