Incoterm and Named Place
Incoterms are standardized trade terms that are commonly used in international commercial transactions. They define the responsibilities of the buyer and seller in a transaction, including the transfer of goods and payment, and help to ensure that both parties understand their obligations and rights. Incoterms are published by the International Chamber of Commerce (ICC) and are regularly updated to reflect changes in international trade practices.
The named place is the specific location that is agreed upon by the buyer and seller as the point at which the obligations and rights of both parties under the Incoterm are fulfilled. For example, in the Incoterm FOB (Free on Board), the named place is the port of shipment, and the seller's obligations are fulfilled when the goods are placed on board the vessel at that location. In the Incoterm CIF (Cost, Insurance, and Freight), the named place is the port of destination, and the seller's obligations are fulfilled when the goods are delivered to the named place. The named place is an important part of the Incoterm, as it determines which party is responsible for various tasks and costs associated with the transaction.
By using Incoterms, you can avoid misunderstandings and ensure that your transactions are completed smoothly and efficiently.
How Incoterms are used in Lyte ERP
In Lyte ERP transactions, there are two fields that pertain to Incoterms: the "Incoterm" field and the "Named Place" field. These fields are used to ensure that the Incoterm and named place are accurately recorded in the transaction.
- The "Incoterm" field is a link field that allows you to select the applicable Incoterm from a list of standardized trade terms.
- The "Named Place" field is a text field that becomes visible after you have selected an Incoterm. This field allows you to type in the specific location that has been agreed upon as the point at which the obligations and rights of both parties under the Incoterm are fulfilled.