Incoterms (International Commercial Terms) were first introduced in 1936 by the International Chamber of Commerce (ICC) with a simple yet powerful goal: to standardize the language of international trade. Since then, they have been updated several times to keep pace with the evolution of global logistics. The latest version, currently in effect, is Incoterms 2020, which includes 11 key terms that clearly define responsibilities, costs, and risks in the delivery of goods between the seller and the buyer.
As freight forwarders and transport operators, we at Gruber Logistics face operational challenges every day where it’s crucial to know who is responsible for the goods, who pays for transportation, who covers the insurance, and where the seller’s risk ends and the buyer’s begins. Whether it’s a local pickup or an international multimodal shipment, Incoterms help us work clearly, efficiently, and safely.
Three letters can change everything. If we see EXW (Ex Works) in a contract, it means the seller makes the goods available at their premises: all responsibilities from that point onward lie with the buyer. On the other hand, DDP (Delivered Duty Paid) means the seller takes care of everything up to the final delivery, including duties and taxes. These aren’t minor details—they shape our daily actions, from transport planning to cost calculations.
Incoterms aren’t just theory or classroom material, even though they’re included in technical school curricula. They are the beating heart of our operations: every parcel, pallet, or container we handle is governed by one of these codes. Knowing them is essential to working effectively, avoiding mistakes, and delivering a professional service that meets our clients’ expectations.
Incoterms connect the world of production (the secondary sector) with that of logistics and services (the tertiary sector). They are a common language, recognized worldwide, that enables engineers, customs officers, transporters, and commercial operators to understand each other instantly. Maps, charts, and diagrams are easy to find online, but our message is clear: for us, Incoterms are not abstract—they are part of our daily reality. That’s why at Gruber Logistics, we know them, we apply them, and we respect them.
Understanding the meaning of Incoterms is essential for anyone involved in international trade: they are not just abbreviations but actual contractual rules that define roles and responsibilities with precision. With practical examples like FCA, CIF, or DAP, it’s possible to tailor each shipment to the legal and logistical needs of the parties involved. However, choosing the right term is never a random decision—it requires experience, contextual awareness, and careful evaluation of the type of goods, mode of transport, and destination country. That’s why at Gruber Logistics, we support our clients in making this strategic choice, offering expert guidance to set every shipment on the right course from the very beginning.
