Terms of delivery of goods, Price and the total amount...

Delivery times

As a general rule, the delivery time is determined by the calendar date to which the goods must be delivered by the seller to the geographical point established by the counterparty. In most cases, geographical locations are defined by the basic terms of delivery.

If the parties did not specify when exactly the goods should be placed at the disposal of the buyer, the time of its transfer is determined, as in domestic trade, as follows: when the obligation does not provide for a due date and does not contain conditions for determining this period, it must be executed on reasonable time after the occurrence of the obligation.

Reasonable time - is the period that has developed in the given region in the corresponding trade of similar goods.

The obligation not performed within a reasonable time, as well as the obligation, the term of execution of which is determined by the moment of demand, the debtor is obliged to execute within seven days from the date of presentation by the creditor of the demand for its execution, if the obligation of execution in another period does not follow from the law, acts, conditions of obligations, customs of business turnover or the essence of the obligation.

Price and total contract amount

The price of the delivered goods is an essential condition of the contract for the international sale of goods. However, if the contract price does not include a price condition for the goods or the method for determining the price of the goods is not included, the contract does not lose its legal effect.

The practice of international trade, the norms of the Vienna Convention, the current civil legislation of the United States and a number of foreign countries proceed from the provision that in this case the parties to the contract of sale mean the price that at the time of its conclusion it was usually charged for similar goods sold under comparable circumstances in the relevant sphere of trade.

When setting the price of goods in a contract, a unit of measurement is specifically defined for which the price is set, the price basis, the price currency, the way of determining and fixing the price, the price level.

By a certain price means a direct price setting in the form of a solid amount. A definable price means the price calculated at the time of payment by specifying in the contract for reference prices published in periodicals, stock quotes at international trade centers, auction prices.

In Anglo-American law, it is provided that, in the absence of an indication of the price or the manner in which it is established, it is considered that the price condition is fulfilled, as the parties "silently" mean reasonable price at the time of delivery, that is, the price normally charged for such goods.

By way to fix the price distinguish prices are solid, with subsequent fixation, moving, sliding.

The fixed price is established at the time of signing the contract, it is not subject to change during the whole period of its validity and does not depend on the terms and the order of delivery of the goods. In contracts with long delivery times, there is usually a price clause: Price is firm, not subject to change.

Solid prices exclude the possibility of subsequent accounting for fluctuations in the economic conjuncture, which may result in losses for one of the parties. Usually such prices are applied in transactions with immediate delivery of goods or for deliveries in a short time.

Prices with subsequent fixation assume a certain fixed amount, valid for a certain period of time. At the time of signing the contract, prices are not fixed, but are determined, for example, before the delivery of each batch, at the beginning of the year, etc.

Movable price - is the price fixed at the conclusion of the contract, which can be revised in the future if the market price of the given commodity changes by the time of its delivery. When a mobile price is established, a price clause is entered into the contract providing that if the market price increases or falls by the time the transaction is executed, the price fixed in the contract (increase or decrease in price) must also change.

Movable prices are fixed in the contract, but they assume that the parties review the prices when the market prices change by a certain percentage (for example, the parties will make such a decision if the price change exceeds 3%). In this case, the contract must necessarily indicate the source, which the parties will be guided in determining the price index.

Movable price - is the price calculated at the time of the contract execution by reviewing the contractual (basic) chain, taking into account changes in production costs for the contract execution period. This price is applied in contracts for goods of a long production cycle. The price stipulated in the contract is corrected by changing pricing factors (wages, raw material costs, etc.) during the contract period. Simultaneously, the limits (as a rule, in percents) of the deviation of the actual price from the contractual price to one side or the other (for example, 5%) are specified.

A wide range of sources is used to analyze prices when concluding a contract. At the stage of preliminary determining the level of contractual prices of the goods are guided by the published and calculated prices.

Published (determined) prices are reported in special information sources. As a rule, they reflect the level world prices of the largest suppliers of this product. For example, the world prices for wheat and aluminum are export prices of Canada, for sawnwood - prices of Sweden, for rubber - prices of the Singapore stock exchange, for furs - chains of St. Petersburg and London auctions, for tea - prices of auctions in Calcutta, Colombo and London. If for primary commodities the world price is determined by the main supplier countries, then leading companies producing and exporting certain types and types of products play a decisive role in the finished products and equipment.

The published prices include: reference chains, stock quotes, auction prices, prices of actual transactions, prices of offers of large firms. These prices reflect to a greater or lesser extent the level of world prices.

Reference prices are prices of domestic wholesale or foreign trade of countries with market economies that are regularly published in business newspapers and magazines, special bulletins, company catalogs and price lists. They can be used when concluding contracts for the urgent delivery of small quantities of goods. When establishing more stable trade relations, reference prices are subject to further agreement: different discounts and allowances are applied.

Exchange price (or stock quote) - the price of the commodity that is the object of exchange trading.

When trading raw materials or semi-finished products, you need to have information about prices on exchanges and auctions. These prices always reflect the real price level when concluding specific deals, as each exchange registers, organizes and publishes exchange quotations. As a rule, exchanges publish quotations for the beginning and end of the morning and evening exchange trades (sessions), quotations of sellers and buyers of goods, quotations for goods with immediate and urgent delivery. Average and other quotations are calculated and published for each day of the work of the exchange. Quotations fairly objectively reflect the world level of commodity prices, and their official publications are the basis for setting prices for similar goods in over-the-counter trading. Information about prices at auctions is important because they are selling real goods on the basis of buyers' contest.

As a starting point for negotiating a price, the trading partners use basic prices which are based on prices published in various directories and price lists < strong> (list prices).

The basic price is the price of the commodity, which is accepted as the basis for determining the foreign trade price of the din product, as well as the price index in international trade in general and for certain types of goods. The base price is regularly revised taking into account changes in the range of foreign trade on the market.

When it comes to selling a unique product that was not previously supplied to the market and which is difficult to compare with other similar products by its characteristics and parameters, the estimated price of the supplier.

This takes into account the technical and commercial conditions of the order, compared with similar products.

In the case of the sale of goods through an intermediary, the price is adjusted usually by 3-5% for payment of commission.

As agreed by the parties, prices are fixed in the contract in the currency of one of the counterparty countries or in the currency of the third country.

The specific price of the contract depends on the basic terms of delivery of the goods. For example, when buying and selling goods on CIF terms, the price of the contract will include expenses for marking, packing, insurance, loading, transportation of goods, etc. When buying and selling on a free-plant basis, the contract price consists of the cost of the goods themselves. >

Let's consider an example of the enlarged calculation of the cost of goods, taking into account transport and other costs associated with the execution of a foreign trade contract on purchase and sale under basic conditions.

Product Costs

+ planned profit

= Price from the supplier factory (EXW)

+ transportation to the railway station

+ cost of forwarder's services

+ insurance

+ cost of loading in the car

= Price ex-car/freight platform (FOK/FOT)

+ freight to the border

= Price product delivered to border (DAF)

+ freight to destination/destination port

= Price freight, freight paid (FCP)

+ expenses in the port: transportation, warehousing, postage, commission of the freight forwarder in the port, additional expenses (telex, telephone, fax, etc.)

+ export duties

= Price freely alongside the ship (FAS)

+ costs for documents, shipping costs, bill of lading costs, sea freight

= Cost cost & freight (CFR) + insurance

= Cost cost, insurance & freight (CIF)

+ cost of transshipment in the port of destination, import duty and document processing

= Price French-pier (EXQ)

+ the cost of transportation to the buyer's location = Price "delivered, duty paid (DDP)

In the invoice for the delivered goods, the invoice price is indicated.

Depending on the basis of the supply, it may include the cost of transporting goods, handling, insurance, payment of export and import duties and other charges.

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