Language is one of the most complex and important tools of International Trade. As in any complex and sophisticated business, small changes in wording can have a major impact on all aspects of a business agreement.
Word definitions often differ from industry to industry. This is especially true of global trade. Where such fundamental phrases as “delivery” can have a far different meaning in the business than in the rest of the world.
For business terminology to be effective, phrases must mean the same thing throughout the industry. That is why the International Chamber of Commerce created “INCOTERMS” in 1936.
INCOTERMS are designed to create a bridge between different members of the industry by acting as a uniform language they can use. Standard Terms have been designed and developed which define the Sellers and the Buyers obligations, risk and actions. They can be read in XXX languages, so making business understanding much closer.
Incoterms are covered in detail in our Fundamentals of Futures and Trade Dynamics course. Each delegate is given a copy of our Incoterms Wall Chart, shown below.
Read the comments of previous delegates on this course:
"Once again we need to thank you and your wonderful organisation for helping us solve a problem. Steve came to our aid when we were trying to negotiate with our landlord. "Trying" being the operative word. We were up against a brick wall. Steve managed to chip away at the bricks and provide us with some light.
He helped us negotiate with the landlord and advised us which route to take." - Vivienne