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Invoicebus for Logistics

[Music] this time let's take a look at offshore trade when you hear the term offshore trade it may sound complicated offshore trade is commonly called between three countries and intermediate trade and it's one of the main trade forms once you get used to it it is not so difficult the method is beneficial for both importers and exporters therefore if you are dealing with trade you will use offshore trade however brokers and freight forwarders need to be very careful when dealing with offshore trade as it requires more processes than having just an importer and an exporter in this video we will use a business example of importing thailand mangoes to america using a japanese broker offshore trade requires a third country's broker in addition to an exporter and an importer the following is an example of how it would look exporter thailand broker japan importer america money product and documentation are the keys to international logistics in offshore trade money and product flow differently also the documentation flow is more complicated and you may experience difficulty until you get used to it now let's have a closer look first of all let's take a look at the money flow once the japanese broker and the american importer make a deal american importer will make payment to japanese agent then japanese agent will make payment to the exporter in thailand when japanese agent issues an invoice to american importer the margin for japanese agent is included in this secondly let's take a look at the product flow a freight forwarder in thailand will make arrangements for an american freight forwarder the product will be delivered directly from thailand to america without going through japan the broker country in offshore trade an importer and an exporter will both benefit by having an intermediate broker the benefits for exporters are reduction in negotiation time with an importer and reduced cost of sales promotion reduced risk of collection from new importers by having an experienced intermediate broker the benefits for importers are an intermediate broker can negotiate the sales cost and the importer will receive reduced sales cost compared with importing goods themselves reduction in transportation as the product is shipped directly from an exporting country to an importing country the product will not go through the third country therefore it will not be taxed as you can see both exporters and importers will benefit from using offshore trade in offshore trade a broker needs to be careful that an importer does not make direct contact with the supplier leading to a direct business arrangement in the future there are cases when supplier information is provided to an importer while trading this time we will use an example of a broker dealing with a business while not disclosing a supplier there is a recognized trade technique which can be used in a situation like this it is called switch invoice and switch bl let's take a look first on the invoice will be thailand which is the exporting country and is shown as seller thailand company buyer america company notify japan company for export customs clearance the product is shipped directly from an exporting country to an importing country if the term is cif they need to use an invoice with the total billing amount which must include the cost of the product as well as the shipping weight and insurance costs this invoice does not included a margin for japanese agent an invoice issued by japanese agent to the american importer will be shown as seller japan company buyer america company you may notice that the supplier information regarding thailand is not included in this invoice this type of invoice is called switch invoice please note for us to be able to understand the difference easily the cost shown is exaggerated on purpose if the first invoice for export customs clearance is sent to america the importer by mistake they will discover the cost difference between the billing amounts from the japanese broker the importer could then discover the broker's margin therefore you can never make this mistake this may cause a trust problem between a broker and an importer therefore a freight forwarder needs to be extra careful when dealing with invoices as you can switch an invoice you can switch bl when transporting goods without disclosing an exporter to an importer with the switchbl you can use a broker's company name on behalf of an exporter's company name now let's take a closer look at how switch bl works first a thailand freight forwarder who is an exporting country will issue a bl this bl is shown as shipper thailand company consignee japan company this bl includes the following place of loading exporting country thailand place of discharge importing country america this original bl will be sent to a japanese broker next the japanese broker freight forwarder will switch bl and this will be sent to an american importer the change point is as follows shipper japan company consignee america company by using switch invoice and switch el you can prevent the american importer discovering the thailand supplier information master bl when a house bl is issued at the place of loading in thailand is as follows shipper freight forwarder in thailand consignee freight forwarder in america this is correct as it displays the same flow of the cargo the difference between the house bl and a master bl is explained in the video link located in the comment section of this video let's take a look at offshore trades bl and cargo flow first a bl is issued in thailand and the original is sent to japan a freight forwarder in japan will switch the bl the switched bl will be sent to america from japan the cargo loaded vessel departs from the place of loading to the place of discharge therefore it is important to make bl arrangements quickly when sending cargo by using offshore trade to nearby countries let me also explain a certificate of origin for offshore trade you can take advantage of customs duty if the trade is between fta and epa countries and provide a certificate of origin issued by an exporting country to an importing country in offshore trade if an exporting country and an importing country are part of fta and epa the benefit is still applicable even when using an intermediate broker in this case you will need a certificate of origin from an exporting country you need to be aware that even if you are not disclosing an exporter suppliers information by using a switch invoice and a switch bl the exporters information will be written on the certificate of origin if you do not understand the risk of disclosing the exporters information on the certificate of origin it may cause some problem there are many advantages using offshore trade however you need to be careful when handling documents if you make a mistake by sending documents by mistake information could be disclosed to an importer a broker and an exporter will lose trust from their customer and porter when using offshore trade it is important to maintain good communication between each business partner to check and confirm during the process in this channel i explain about the technical term and job description in logistics if you are interested in logistics work or if you already work in the logistics industry i believe that this channel will be a good support for your job if this time video get the good support for your understanding please subscribe press good or comment anything well see you next time