What does CFR mean in shipping terms?

What does CFR mean in shipping terms?

When goods are bought or sold Cost and Freight (CFR) it means that the Seller is responsible for the delivery of the goods to a ship and loading the goods onto the ship. The seller is also responsible for any customs export documentation and export licences if needed.

What is CFR incoterm agreement?

The CFR Incoterm or “Cost and Freight” is an Incoterm that is exclusive to ocean freight shipping. It states that the seller is not only responsible for delivering the goods to the port specified by the buyer, but also bears the transportation costs of the goods to the destination port.

Who pays freight in CFR?

The term CFR means that the seller has more responsibility; they will pay for and arrange transportation. This can be contrasted with a seller under a FOB shipping transaction; where the seller is merely responsible for delivery of the goods to the port of origin; they will then be transported.

Which is better CIF or CFR?

In short, it is the seller who must ensure the goods under CIF, while that responsibility lies with the buyer under CFR. Thus, in broad terms, CIF is generally the safer and more time-effective option for buyers, as it reduces insurance arrangement obligations.

What is difference between FOB and CFR?

Key Takeaways. Free on Board means the seller is responsible for the product only until it is loaded on board a shipping a vessel, at which point the buyer is responsible. With CFR, the seller must arrange and pay all costs to ship the product to a destination port, at which point the buyer becomes responsible.