Regarding Condition types

[Former Member]

Hi, Guru's,

DDU/DDP Price what is this mean , it comes in pricing Condition type?could u please solve this one?

Thanks & Regards,

Chandrasekhar Reddy.

[Former Member]

hi

its actually a Free Works Offer (DDU/DDP)..

it is defined in the Logistics Delivery Sheet at the time of Bid Submission in the Delivery Process..

we dont actually this kind of process in indian business senerios..

Delivery date

The precise dates on which deliveries are due, are specified in the Purchase Order.

This brings uncertainty because the date defined in the Purchase Order refers to the

date when SIT needs the product to be available in Finspong. When other Incoterms

than DDU/DDP are agreed upon, SIT faces problems because the supplier’s leadtime

sometimes are not adjusted to meet with the date given by SAP R/3.

If the contract is of the type Departure the standard conditions are always EXW. This

means that the buyer is responsible for everything, included picking up the goods at

the supplier’s factory as well as arranging the transportation.

In the second group, Main Carriage Unpaid, the responsibility mainly lies by the

buyer. The supplier has fulfilled the commitments when the goods have been

delivered for transport at a settled location. Are the conditions FCA used the supplier

carries the costs and responsibility until the goods have been delivered to the

transportation firm.

The Incoterms DDU and DDP are included in the fourth group. These are the

opposite of EXW, and here the supplier is responsible for delivering the goods to the

buyer’s front door. The only difference with DDU is that the buyer pays the import

duties.

At SIT the Incoterms EXW and DDU/DDP are mainly used. During year 2006 the

management expressed a strategy which means passing on to DDU/DDP-agreement

to greatest possible extent. The objective is that the supplier should take the risk and

responsibility during the transportation. According to them it is also easier to define

when goods are delivered when practicing DDU/DDP. A result of changing from

any other Incoterm to DDU/DDP is increased purchase price. It is however not

stated by management which increases of price that is acceptable in making this

transformation possible.

At SIT the directives are to use DDU or DDP as far as possible. There are several

cases though where this is not profitable, neither for SIT nor for their suppliers. Often

SIT has better transport agreements, which can not be utilized with this strategy.

Consequently the supplier adds the increasing transportation costs to the price.

Before switching from, for example, EXW to DDU the actual cost increase must be

clarified. To start with, the motive of only using DDU must be made clear to all

employees concerned. Furthermore there might be other alternatives for reaching the

goal sought after. This can though only be achieved by explaining the goal to the

ones striving to attain them.

Reward if Useful

Thanx & Rgeards..

Naren..

[Former Member]

Hi,

I'm not sure what you meant by the DDU/DDP price.

But both DDU and DDP are incoterms which are used for exports.

Also check if you have any freight condition types which are maintained in your pricing procedure....since incoterms are used in that particular condition type.

Hope it helps.

[Former Member]

Can you please explain me in detail as to what is your problem and where do you find DDU/DDP.