Points to remember

1. If you are offering an agency to someone, convince him that your products are worth selling and will find a market in his area.

2. Be clear about the type of agency you are offering: exclusive or non­ exclusive, on a consignment basis or a sale and retail basis.

3. Offer terms and suggest methods of settlement of accounts. Be positive about the support that you, the principal, can provide for your agent.

4. If you are asking for an agency, make sure the manufacturer appreciates the standing of your company and convince him that his products will be well represented.

10.7

Words to remember

an agent

an agency

a broker

a principal

a client

an importer

an exporter

a competitor

a rival

to offer an agency

sole/exclusive agency

non-exclusive agency

consignment basis

commission basis

'del credere' commission

own account basis

c.i.f. invoice values

net invoice values

a reference

Trade Journals

departments of trade

Chambers of Commerce

consulates

Trade Associations

a broker/dealer

the Stock Exchange

shares

commodity markets

the Metal Exchange

bullion

foreign currency

insurance brokers

insurance cover

underwriters

compensation

indents - open/closed/specific

a confirming house

an export manager

a manufacturer

a supplier

a factor

non-recourse factoring

recourse factoring

a manufacturer's agent

a buying agent/house

to develop a market

to create a demand

to renew a contract

11 Transportation and shipping

Road, rail and air transport and documentation; shipping (types of vessels, shipping organizations, shipping documentation and insurance, forwarding agents); container services and documentation; chartering ships.

11.1

Road, rail, and air

The three main methods of transporting goods, besides shipping which we will deal with in a separate section, are road, rail, and air.

11.1.1

Road transport

Road transport tends to be comparatively cheaper and more direct than rail, and in the past few years haulage (trucking) has doubled in the UK. The reasons for this include the increased capacity for lorries to carry goods, particularly with the introduction of containers (large steel boxes which allow for bulk transportation), faster

services, with road improvements (motorways), and accessibility abroad with ferries (boats crossing the Channel) offering rolling-on and rolling-off facilities, i.e. trucks can drive on to a Channel ferry, cross, then drive off without unloading.

11.1.2

Rail transport

Rail transport is faster than road, which is necessary especially when transporting perishable goods, i.e. fish, fruit, meat, etc., and can haul bulk commodities (oil, grain, coal) in greater volume than road transporters.

There is a link between road and rail through companies such as Freightliners, but transshipment (transferring goods from train to truck) can still be a problem. Special ferries are available to take trains across the Channel to link up with European rail services, and British Rail also has container facilities. Nevertheless, rail transport tends to be comparatively more expensive than road haulage.

11.1.3

Air transport

Some goods lose value over time, e.g. newspapers, or deteriorate, e.g. flowers; therefore, airtransport is used for speed, particularly over long distances. Insurance tends to be cheaper as consignments spend less time in transit. However, with bulk consignments, air is much more expensive, and can be uneconomical.

The main document used is the Air Waybill (AWB), which consists of 12 copies distributed to the airline, exporter, importer, and customs, see 11.2.9. Unlike the bill of lading, 11.3.3, the Air Waybill is only a receipt and cannot be transferred to another person.

11.1.4

Documentation

Consignment notes are used in road and rail transportation, see 11.7.7, and like the AWB they are not documents of title so ownership of the document does not mean ownership of the goods. They are not negotiable, i.e. they cannot be bought, sold, transferred by the consignor (the exporter), or the consignee (the importer).

Consignment notes and waybills are obtained by the consignor filling out an instructions for despatch form, and

paying the freight charges (the cost of sending the goods). These charges are calculated in size (volume), weight, or value, and sometimes risk, particularly if special precautions have to be taken.

Most freight companies are private carriers, which means they are only responsible for negligence (not taking proper care of the goods).

In the Economic Community, and European Free Trade Area (EFTA) movement certificates are used especially for container shipments, see 11.5, if the consignment is taken through different customs posts to member countries.

Since the late 1980s many of these customs forms have been included in one document, the Single Administrative Document abbreviation: (SAD). This is an eight-part set of forms for export declarations. In addition the Simplified Clearance Procedure abbreviation: (SCP) is also used to make documentation easier for exports and agents.

Correspondence in transport is generally between the sellers and freight firms, or sellers and forwarding agents, who send goods on behalf of the seller. The customers are kept informed by advice notes which give details of packing and when goods will arrive.

HOMEMAKERS Ltd.

54-59 Riverside, Cardiff CF1 1JW

Telephone: (0222) 49721 Registered №.C135162

Telex: 38217

Transport Manager 10 November 20—

Cartiers Ltd.

616-9 Cathays Park

Cardiff CFl 9UJ

Dear Sir,

Would you please quote for collecting, from the above address, and delivering the following consignment to R. Hughes & Son Ltd., 21 Mead Road, Swansea?

6 divans and mattresses 700cm x 480cm

7 bookcase assembly kits packed in strong cardboard boxes, measuring 14 cubic metres each

3 coffee table assembly kits, packed in cardboard boxes, measuring 10 cubic metres each

4 armchairs, 320 x 190 x 260cm

The divans and armchairs are fully protected against knocks and scratches by polythene and corrugated paper wrapping, and the invoiced value of the consignment is £1,660.50.

I would appreciate a prompt reply, as delivery must be made before the end of next week.

Yours faithfully,

R, Cliff

11.2