Commercial: Commercial Learning

Freight Calculation:

C/O

DEFINATION: It meaning “Certificate of Origin”. This paper is wanted by BUYER. This paper is as certification of a country.

TYPE: This is two type: 1. C/O of yarn

2. C/O of garments.

1. C/O of yarn: This paper is used for incentive purpose. This paper is given by BTMA.

2. C/O of garments: This paper is used for BUYER and GSP.

Type of garments C/O:

1. Metropolitan chamber of commerce.

2. Dhaka “

3. SHIPPER

4. BKMEA

5. BGMEA

1. Metropolitan chamber of commerce: It is depend on BUYER requirement.

2. Dhaka chamber of commerce: It is depend on BUYER requirement.

3. SHIPPER: It is given on shipper pad for GSP. It S/B submitted in EPB with BKMEA.

4. BKMEA: Its give two type of C/O for garments and fabric supply.

5. BGMEA: It gives for only garments.

PAPER REQUIRED FOR C/O:

1. Commercial Invoice.

2. Packing list.

3. BL (Bill of landing) or AWL.

4. Bill of ENTRY (Import) or shipping bill(Export).

SHIPPING BILL: Its amount depend on Commercial invoice amount. Shipper have to pay shipping bill at rate of .20-.23 TK./ USD. The amount of commercial invoice is 3122 USD. Then

SHIPPING BILL = 3122 @ .2 = 624 TK.

5. C/O Form Rate: 30-50TK. It is available in JANATA BANK. Then approved C/O Form from EPB, BGMEA, BKMEA- 400TK.(Salad) otherwise 3 or 4 days delay. It you do not five salad.

6. Cash or Bank Draft Form for CO Form approved charge: 200TK. for all above enterprise. It is noted that BUYER want GSM for getting some tax free for ECC, BUYER get 13% tax free. GSP is one type C/O.

For FOB & C&F Order Shipper get Original BL. But for GSP purpose SHIPPING LINE give you NON neogosetatable BL copy which is submitted EBP. For payment shipping line original BL after 3 or 4 days from shipment.

SEA FREIGHT & AIR FREIGHT CALCULATION

1. Container Specification:

Type of container: 1.Steel dry cargo container

2. Flat rack (platform)

3. Open top container

4. REFER STAINLESS STEEL container.

In garment sector generally steel dry cargo container

SPECIFICATION - 20”(NORMAL) - 20” HI-CUBE - 40” NORMAL - 40” HI-CUBE

LENGTH 20” 20” 40” 40”

WIDTH 8 8 8 8

HIGHT 8”6 8”6 8”6 9”6

AIR CAPACITY

HOLD CAPACITY

G . W 30490KG

PAYLOAD

Main classes of A “ L/C ”:

1. 27: Sequence of total (NO OF PAGES)

2. 20/21 Document Credit no.

3. 31C: Date of Issue

4. 31D: Date and Place of Expirity

5. 32B: Currency Code / Amount

6. 40A: Form of Document Credit (Like at sight)

7. 43P: Part Shipment

8. 43T: Trans Shipment

9. 44A: On Board/AISP/Taking change of/f (A part of side)

10. 44B: For Transportation to

11. 44C: Latest date of shipment

12. 45A: Description of goods &/or services.

13. 46A: Documents required (1) B/L (2) C/O (3) IC (4) GOP (5) EXP

14. 47A: Additional conditions

15. 48: Period for presentation: 10 days or 21 days (15 best)

16. 49: Confirmation Instruction.

17. 50: Application

18. 59: Beneficiary

57D: Advise through Bank: Name & address.

71B: Charges: All banking charges are Applicant account / Beneficiary

78: Instructions to paying / Acc tg / Nego tg.

BANK LOAN

If any body take loan from any bank & he will not pay interest following in the bank rules:

1. Classified: If any body not pay interest within 6 month end of that period is called classified.

In this period bank calculate interest as a bank profit. It never been reduced.

2. Suspension: The period after 6 months of classified is called suspension. Bank show interest in lager. Its have chanced to reduce 50% depend on customer actual situation.

3. Bed loan: The period after 6 months of suspension is called Bed loan period. Bank don’t show interest in lager. It can reduce 100% but depend on customer actual situation.

SHIPPING TERMS

1. CM- cost of making / cutting & making.

2. FOB- free on board / freight on bord.

3. C& F- cost & freight / clearing & forwarding.

4. CIF- cost, insurance & freight.

5. CIFI- cost, insurance, freight & interest.

6. CIFE- cost, insurance, freight & exchange.

7. COD- cash with order

8. CWO- cash on delivery

9. FOW- free on wagon.

10. Franco- Exporter bear the transportation cost from Exporter store to

Importer store.

11. CRF- clean report of finding

12. HS CODE- Harmonic system code.

CARGO BOOKING

Require paper: 1. commercial invoice.

2. packing list (with Gross weight & Net weight) CBM

1. Berthing: shipping line knows an inform when the ship loading.

Cut off: 12 hours before sailing is called cut off.

Special sailing: when the ship leave in port permission we take for putting the container in ship before 6 hours from sailing.

BANK INTEREST SYSTEM

If interest 14.5% & quarter system dt. 31/3/2002, 30/6/2002, 30/9/2002, 33/12/2002.

If any one pick money from bank then interest counting system given below:

12 days>31 days.

Draw dt. 20/01/02 – 20.02.02 interest- 2463TK

20.03.02 – 29.04.02 “ 4926 “

BB L/C Charges

1. Advising charge = 500

2. Stamp(150+35) = 185

3. Postage = 150

4. Bank commission = .8% (BBL/amount)

Acceptance charge =.8% (BBL/amount)

B/L:

For FOB:

1. THC (The terminal handing charge):

L/CL : 170TK/CBN

FCL : fixed for 20’ container

40’ “

2. B/L charge: 600-1500 (including stamp)

P & Q 600 (without stamp)

10 CBM – 20/150TK, 40/600TK, 40 HQ/600TK Revised stamp.

CONTAINER SPECIFICATIONS

(A) 20 Feet Container:
Length; 228"xWidth; 84"xHeight; 94"
225x84x94 = 1, 288 cubic inch
1800,288/39.37x39.37x39.37=29.50CBM.
A 20 Feet container has an air capacity of 29.50 CBM, but when you
ship goods packet in cartons or wooden crates, it can hold about
25-27 CBM.
( B) 40 Feet Container (standard):
Length;474"xWidth;84"xHeight;94"
474x84x94 = 3,742,704 cubic inch
3,742,704/39.37x39.37x39.37 = 61.32 CBM.
A 40 Feet container has an air capacity of 61.32 CBM, but when you
ship goods packet in cartons or wooden crates, it can hold about
55-57 CBM.
( C) 40 Feet High Cube Container:
Length;474"xWidth;84"xHeight;106"
474x84x106 = 4,220,496 cubic inch
4,220,496/39.37x39.37x39.37 = 69.15 CBM.
A 40 Feet container has an air capacity of 69.15 CBM, but when you
ship goods packet in cartons or wooden crates, it can hold about
65-67 CBM.

Fashion House BD
DETAIL PACKING LIST

MAIN MARKS							SIDE MARKS
PO # 7005						PO #	:7005
BUYERS: WAL-MART						BUYER	: WAL-MART
DESCRIPTION: 100% COTTON KNIT BOXER						SIZE	:S-L
QUANTITY: 54 PCS						QUANTITY	:54PCS
MADE IN BANGLADESH						G.W	:10.50
CARTON # 01 OF 353						N.W	:6.00
Assortment: Assort colour and assort size pack.						MEAS	:40X30X45CM

CTN #	TTL CTN	STYLE #	COLOUR	SIZE RATIO			QTYXCTN	t.Qnty
CTN #	TTL CTN	STYLE #	COLOUR	S	M	L	QTYXCTN	t.Qnty
		2211	WHITE	6	6	6	54X353=19062	19062
1-353	353	2212	BLACK	6	6	6
		2213	BLUE	6	6	6

TTL CTN 353 PCS TTL QUANTITY 19,062 PCS

COLOUR AND SIZE WISE QUANTITY BREAKDOWN

STYLE #	COLOR	S	M	L	TOTAL
2211	WHITE	2118	2118	2118	6354
2212	BLACK	2118	2118	2118	6354
2213	BLUE	2118	2118	2118	6354
TOTAL		6354	6354	6354	19062

TOTAL QUANTITY		:	1588.5 DZN 19062 PCS
TOTAL CTN		:	353 CTN
TOTAL N. WT		:	2118 KGS
TOTAL G. WT		:	3706.5 KGS
TOTAL CBM		:	19 CBM

Fashion House BD
Detail Packing List

Main Mark						Side Mark
PO	:	2159				PO	:	2159
Buyer	:	J.C Penny				Buyer	:	J.C Penny
Description	:	Men's L/S Shirt				QTY/CTN	:	30 Pcs
Assortment	:	Solid Colour Solid Size				Size	:	S, M, L, XL
QTY/CTN	:	30 Pcs				G. W.	:	14.00 Kg
Country of origin :						N. W.	:	10.00 Kg
Carton	#					Ctn Meas	:	60X45X65 cm
Destination	:	New York

Ctn #		COLOUR	Assortment				QTY Per Ctn Pcs	TTL	Total
Ctn #		COLOUR	S	M	L	XL	QTY Per Ctn Pcs	TTL	Total
01-07		Black	30				30	7	210
08-25		Black		30			30	18	540
26-35		Black			30		30	10	300
36-50		Black				30	30	15	450

Sub Total								50	1500

51-70		Blue	30				30	20	600
71-100		Blue		30			30	30	900
101-150		Blue			30		30	50	1500
151-170		Blue				30	30	20	600

Sub Total								120	3600

Colour & size wise break down
COLOUR	Assortment				Total
COLOUR	S	M	L	XL	Total
Black	210	540	300	450	1500
Blue	600	900	1500	600	3600

MAIN MARKS						SIDE MARKS
PO #	3005					PO #	: 3005
STORE	: WAL-MART					STORE	: WAL-MART
DESCRIPTION : 100% COTTON MEN'S T- SHIRT						SIZE	: S - L
STYLE #	COLOUR	ITEMS #				QUANTITY : 48 PCS
2305	WHITE	M - 7700				G. W.	: 14.50 KGS
QUANTITY	: 48 PCS					N. W.	: 11.00 KGS
MADE IN BANGLADESH						MEAS	: 55X40X70XCM
CARTON #	01 OF 500
Assortment	: Solid Colour & Assort Size

CTN #	TTL CTN	STYLE #	COLOUR	SIZE RATIO			QTY X CTN = TTL
CTN #	TTL CTN	STYLE #	COLOUR	S	M	L	QTY X CTN = TTL
1-125	125	2305	WHITE	16	16	16	48 X 125 = 6000 PCS
126-245	120	2306	BLACK	16	16	16	48 X 120 = 5760 PCS
246-375	130	2307	BLUE	16	16	16	48 X 130 = 6240 PCS
376- 500	125	2308	STONE	16	16	16	48 X 125 = 6000 PCS
TTL
TTL CTN	500			TTL QUANTITY 24000 PCS

COLOR AND SIZE WISE QUANTITY BREAK DOWN
STYLE #	COLOUR	S	M	L
			M	L
2305	WHITE	2000	2000	2000
2306	BLACK	1920	1920	1920
2307	BLUE	2080	2080	2080
2308	STONE	2000	2000	2000
TOTAL		8000	8000	8000

TOTAL QTY		: 2000 DZ 24000 PCS
TOTAL CTN		: 500 CTNS
TOTAL N. WT		: 5500 KGS
TOTAL G. WT		: 7250 KGS
TOTAL CBM		: 77 CBM

20ft	L	W	H	CUFT	CUM
CONTAINER SPC	20'	8'	8' 6"
CONTAINER	19'4 1/4"	7' 8" 5/8	7' 10"	1165
CONTAINER	5.899 mm	2.325 m	2.386 m
40ft	L	W	H	CUFT	CUM
CONTAINER SPC	40'	8"	8' 6"
CONTAINER	39' 5 5/8"	7' 8 5/8"	7' 10 1/4"	2392
CONTAINER	12.02 mm	2.34 mm	2.39 mm
40ft	L	W	H	CUFT	CUM
CONTAINER SPC	40'	8'	9' 6"
CONTAINER	39' 5"1/2	7' 8"1/2	8' 10 1/4"	2696
CONTAINER	12.02 mm	2.35 m	2.69 m

Sea Freight and Air Freight:

Although most orders for garments are placed by buyers on FOB basis, with buyers to pay for freight at the shipping destination, it is still necessary for the shipper or the agent to know how to calculate sea freight and air freight as buyers always need to know how much freight the merchandise cost per dz. If you are required to sell on CIF basis, (with the shipper to prepay for freight at the shipping port) you will need to calculate the freight accurately for your own costing.

1. Sea freight:

Sea freight is usually charged based on volume—how much per CBM (cubic meter)—very rarely by weight as “density cargo”. In fact ANERA (Asia North America eastbound rate agreement) has designed the freight tariff more based on the usual value of the type of goods, than the usual weight of them, taking into consideration that for low value merchandise they should give a low freight rate in order to make it possible for the importers to buy goods overseas. However, for high value merchandise, they should charge a high freight rate, as it is believed that the buyer can afford to pay more on freight. The have designed the freight tariff in such a way that everybody can do business and there is sufficient profit for the shipping lines.

Container size	Calculated Capacity	Practical capacity	Container FCL rate	FCL rate for CBM	LCL Rate per CBM
20” Capacity	29.5 CBM	27 CBM	3500	130	160
40” Normal	61.32 CBM	54 CBM	5000	92	160
40” Hi Cube	69.15 CBM	62 CBM	6500	92	160

Note: FCL: Full container Loading

LCL: Loose container Loading

If you ship very heavy goods as loose cargo because the size of the shipment is very small, the shipping lines will charge you by weight or by volume whichever is higher.

1 CBM (100 cm X 100 cm X 100 cm) = 1000 Kg

2. Air freight:

Unlike sea freight, the airlines have decided to charge for the heavy merchandise (high density goods) by weight, and lightweight merchandise (low density goods) by volume. However, as airplanes can take less weight than ocean liners, the way they

Set the standard, in the garment industry, when you ship goods by air, you have a 70% chance to be charged by weight, about 30% chance by volume.

The followings are the relationship between weight and volume as set by IATA ( International air transport association).

a. From most shipping locations in the Far east to the U.S. destinations and Canada 7000 cubic cm = 1 kilo.

b. From certain locations in the Far east to the U.S. destinations and Canada 6000 cubic cm = 1 kilo

Therefore when you have low density goods to ship by air, in order to determine if you should try to make the cartons as small as possible to save freight. First you check with the local air forwarding agent by asking him in the country where you are, how many cubic cm is considered 1 kilo in weight. They will tell you either 7000 or 6000. This is the answer you need.

Then you physically check the weight and measurements of the good s packed for the air shipment. Now we have the 3 answers as follows, for example:

a. The country is Bangladesh and the formula is 6000 cubic cm = 1 kilo

b. The measurements of the cartons are 50cmX 60cmX 40cm

c. The gross weight of the cartons are 16 kilo per carton.

Now let us find out if we should try to make the cartons smaller to save air freight by doing the following calculation,

Multiply 5 by 60 by 40 = 120000 cubic cm.

120000 cubic cm divided by 6000= 20 kilo

Now you know, by volume the one carton is of 2 kilo, but by actual weight the carton is of only 16 kilo. You also know the airline will charge whichever is higher, in this case, they will charge you for 20 kilo, by volume. If the air freight rate is 2.80 per kilo this carton will cost you $ 56.00.

Now, in order to save some money, let us try to make the carton smaller, usually by cutting the height of the carton. Lets say we have succeeded in cutting down the height by 5 cm, and see how much money we can save.

** Original size of the carton: 50 X 60 X 35 cm (=20 kilo)

** Now cut down to 50 X60 X 35 cm= 105000 cubic cm.

105000 / 6000 = 17.5 kilo

Now by using the new carton, we have saved 2.5 kilo and this carton will cost only $ 49.00 (17.5 Kilo X 2.80)

Shipping Terms

1. CM: Cost of making/ cutting and making

2. FOB: Freight on board

3. C & F: Cost and freight / Clearing and forwarding

4. CIF: Cost, insurance and freight

5. CIFI: Cost, insurance, freight and interest

6. CIFE: Cost, insurance, freight and exchange

7. COD: Cash on delivery

8. CWO: Cash with order

9. FOW: Free on wagon

10. Franco: (…Named Port of Shipment)

11. FOB: Free on Board (…Named Port of Shipment)

12. CFR: Cost and Freight (…Named Port of Destination)

13. CIF: Cost, Insurance and Freight (…Named port of Destination)

14. CPT: Carriage Paid To (…Named Place of Destination)

15. CIP: Carriage and instruction paid to (…Named Place of Destination)

16. DAF: Delivered at frontier (..Named Place)

17. DES: Delivered Ex Ship (…Named Port of Destination)

18. DEQ: Delivered Ex QUAY (…Named Port of Destination)

19. DDU: Delivered Duty Unpaid (…Named Place of Destination)

20. DDO: Delivered Duty Paid (…Named Place of Destination)

Country and port:

Country	Port & price	Buyer
Sweden	Hamburg	New Wave Mode Lab
Sweden	Gothenburg	Cellbes Post Order AB
Spain	Barcelona (1500)	Geologistics Barcelona S.A.
Italy	Genova	Samar Spa
Sweden	Barcelona	Rueca Europea S. L.
France	Leharve (1200)
U.K.	Liverpool (1400)
Germany	Quaken Bruech (1645)	Centerline mode Vertriebs GMBH
Netherlands	Rotterdam

FREIGHT

Both air transportation and sea transportation used in delivering goods from one country to another. However, the calculation for the changes of air freight and sea freight are different, as following:

1. Sea Freight

Sea freight is changed on a volume (cubic meter or CBM) basis. Firstly, the volume of a carton is calculated by multiplying the length by the width by the height of the carton. Secondly, the freight charges for the deliver merchandise can be calculated by multiplying the volume of a carton by the number of needed cartons by the price charged per cubic meter (CBM).

Sea Freight Charges:

= Volume per carton in CBM x number of cartons x cost of sea freight per (CBM).

Where

Volume per carton (CBM)

Length(cm) x Width(cm) x Height(cm)

= -------- -------- --------

100 100 100

Length(cm) x Width(cm) x Height(cm)

= ---------------------------------

1728 x 35.32

Commercial

Monday, April 25, 2011

Commercial Learning

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