Mastering Incoterms 2020: For Global Trade Excellence

Duration: 2 Days
Time: 9:00am to 5:00pm

Introduction

In international trade, understanding Incoterms is essential for defining the responsibilities, costs, and risks between buyers and sellers. Misinterpretation or misuse of Incoterms can lead to financial losses, disputes, and inefficiencies in global transactions.

This specialized training provides a structured approach to mastering Incoterms, ensuring participants can confidently apply them in trade agreements. The course covers the purpose, evolution, and significance of Incoterms, along with a deep dive into the respective group (E, F, C, and D).

Each module provides a comprehensive analysis of obligations, cost allocation, and risk transfer points, equipping participants with the knowledge to choose the most suitable Incoterm for any transaction. Through real-world case studies, common misconceptions and best practices are explored to enhance decision-making.

Additionally, the training highlights the key changes from Incoterms 2010 to 2020, cost and risk allocation principles, and effective negotiation strategies to optimize trade terms.

Participants will gain practical insights into selecting the right Incoterm based on transport mode, risk exposure, and financial implications. By the end of this course, participants will be equipped with the expertise to navigate international trade with precision, ensuring compliance, cost efficiency, and minimized risk in contractual agreements.

Learning Objectives

• Define the purpose, history, and significance of Incoterms in international trade.
• Differentiate the four groups of Incoterms (E, F, C, and D) based on their risk transfer points, obligations, and cost responsibilities.
• Explain the key obligations, cost structures, and risks associated with each Incoterm.
• Apply the appropriate Incoterm for different modes of transport and trade scenarios to ensure efficiency and compliance.
• Develop a strategic approach for selecting Incoterms based on risk management, cost optimization, and trade conditions.
• Navigate the key changes between Incoterms 2010 and Incoterms 2020 to understand their impact on international trade agreements.
• Assess the financial and risk implications of various Incoterms, including cost allocation, insurance requirements, and customs duties.
• Illustrate real-world case studies where Incoterms were effectively applied or misused, drawing lessons for best practices.
• Explain negotiation strategies to leverage Incoterms for favorable trade terms and risk mitigation.
• Apply Incoterms knowledge to prevent malpractice, disputes, and inefficiencies in global trade operations.
• Develop negotiation finesse using Incoterms for successful international deals.

Key Content

Module 1: Introduction to Incoterms
• Purpose, history, role in trade
• Evolution of Incoterms versions
• Key concepts: risk, delivery, obligation
• Significance of Incoterms
• Common misconceptions about Incoterms
• Quiz/Assessment

Module 2: Grouping Incoterms and Responsibilities
• E, F, C, D grouping Incoterm concepts
• Seller-buyer obligations within groups
• Incoterms for different modes of transport
• The 10 Articles Explanation
• Pros and cons of Incoterms
• Quiz/Assessment

Module 3: E Group Incoterms
• EXW, buyer-risk focus
• Seller-buyer obligations, costs, risks
• Risk transfer points and their significance
• Advantages and disadvantages for this Incoterm
• Best Scenarios to use for this Incoterms
• Summary table and graphic reference for this Incoterm
• Quiz/Assessment

Module 4: F Group Incoterms
• FCA flexibility and transport modes
• FAS, FOB for maritime transport
• Seller-buyer obligations, costs, risks
• Risk transfer points and their significance
• Advantages and disadvantages for respective Incoterms
• Best Scenarios to use for respective Incoterms
• Summary tables and graphics reference for respective Incoterms
• F Group Comparison Summary Table
• Quiz/Assessment

Module 5: C Group Incoterms
• CFR, CIF: Freight and Insurance
• CPT, CIP: Insurance coverage, risk
• Seller-buyer obligations, costs, risks
• Risk transfer points and their significance
• Advantages and disadvantages for respective Incoterms
• Best Scenarios to use for respective Incoterms
• Summary tables and graphics reference for respective Incoterms
• C Group Comparison Summary Table
• Quiz/Assessment

Module 6: D Group Incoterms
• DAP, buyer delivery notice
• DPU, unloading responsibility
• DDP, comprehensive obligations, duties & taxes
• Seller-buyer obligations, costs, risks
• Risk transfer points and their significance
• Advantages and disadvantages for respective Incoterms
• Best Scenarios to use for respective Incoterms
• Summary tables and graphics reference for respective Incoterms
• D Group Comparison Summary Table
• Quiz/Assessment

Module 7: Understand Cost and Risk Allocation
• Seller-buyer costs responsibility in respective Incoterms
• Varying risk transfer points, insurance significance
• Cost & Risk Summary By Incoterms
• Insurance and duties, taxes calculation
• Types of customs forms
• Key strategies for negotiating Incoterms by considering cost and risk

Module 8: 7 Key Changes of Incoterms (FY2010-FY2020)
• Key changes explained for seller-buyer roles, transportation, documentation
• Summary tables for 7 Key Changes FY 2010 and FY 2020
• Comparison between Incoterms version FY2010 vs version FY2020

Module 9: Case Studies and Real-World Scenarios
• Analysing intricate trade situation
• Problem-solving, optimal Incoterms selection
• Learning from real-world examples, outcomes
• Multiple examples for case studies & key learnings
• Factors to consider when choosing appropriate Incoterms
• Quiz/Assessment – Case Study Worksheet

Module 10: Advance and Practical Negotiation Strategies with Incoterms
• Leveraging Incoterms for negotiation goals
• Dynamics, psychology, and cultural factors
• Conditional terms, risk management, ethics
• Various useful and practical strategies to use in Incoterms negotiation
• Outcome for each strategy negotiation
• Lesson learned for each strategy negotiation
• Best Incoterms for different shipping scenarios
• Best Incoterms for different mode of transport
• Incoterms & Risk Management In International Trade
• Malpractice in Incoterms
• Standard Checklist on how to select appropriate Incoterms

Who Should Attend

Suitable for Director, Manager, Executive, Assistant and Officer
• International Trade
• Export and Import
• Supply Chain
• Logistic
• Warehouse
• Shipping
• Procurement
• Purchasing
• Administrative
• Customer Service
• Finance
• Sales & Marketing
• Clerical Staffs
• Legal
• Business Owner

Methodology

This comprehensive two days Incoterms course employs a dynamic training approach that blends interactive engagement, practical application, and real-world scenarios to ensure a rich and effective learning experience. The methodology is designed to cater to various learning styles, fostering active participation and knowledge retention.

The training unfolds through a combination of instructor-led presentations, group discussions, and hands-on exercises. Each module is introduced through concise presentations that simplify complex concepts, making them accessible to participants of all backgrounds. Engaging group discussions follow, encouraging participants to share insights and collectively deepen their understanding.

A key highlight is the integration of practical case studies and real-world scenarios. These examples resonate with participants, enabling them to apply theoretical knowledge to concrete situations, thereby enhancing their problem-solving skills and decision-making acumen. The course also incorporates group presentation on role-playing exercises to simulate negotiation scenarios, allowing participants to practice advanced negotiation strategies using Incoterms.

Furthermore, periodic Q&A sessions provide a platform for clarifying doubts and reinforcing concepts. This participatory approach ensures that participants actively engage with the material and have their queries addressed in real-time. By combining interactive presentations, collaborative discussions, realistic case studies, and negotiation simulations, this training methodology maximizes comprehension, equipping participants with practical skills and confidence to proficiently navigate the intricate realm of international trade using Incoterms.