“Free Carrier (FCA)” means the seller, free-of-charge and at its own risk, brings the goods to a designated spot, within their own home country, where the carrier can take the baton. Think airports, shipping docks, warehouses, or wherever these transport titans hang their hats.
This initial step is called pre-carriage. And once it is complete and the handoff is made, it’s game time for the buyer, who then shoulders all the responsibility for the rest of the shipping journey.
Now these ‘pre-carriege perks’ are great for the buyer obviously. But what’s in it for the seller? Here are some of the main reasons behind choosing FCA shipping:
More time to secure payment before saying goodbye to goods!
FCA terms allow more time to the seller to make sure the payment for the cargo clears before they relinquish control.
Home Field Advantage:
The seller is positioned to gain a competitive advantage by providing pre-carriage shipping. Under FCA Incoterms, the seller is responsible for export clearance. After all it’s their neighbourhood and the know all the twists and turns. They may also have lots of unused ‘discount coupons’ with their local logistics suppliers, and can reduce the total cost of sourcing the products for their buyers.
To sum it all up, under FCA shipping terms the seller can leverage their connection and knowledge of the local market to increase efficiency and reduce costs of the first mile and the export customs clearance.
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