Is DDP door-to-door delivery?
Jul 09, 2024
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1, The definition and connotation of DDP
DDP, The full name is Delivered Duty Paid (named place of destination), which means that the seller, after completing the import customs clearance procedures at the designated destination, delivers the goods that have not yet been unloaded from the delivery transportation vehicle to the buyer, completing the delivery. This definition includes several key elements: firstly, the seller needs to transport the goods to the destination specified by the buyer; Secondly, the seller is responsible for handling import customs clearance procedures; Finally, the seller shall bear all risks and costs associated with transporting the goods to their destination.
From this definition, DDP seems to have some similarity to what we commonly refer to as "door-to-door delivery.". However, this similarity is only superficial, and we need to further explore the differences and connections between the two.
2, The difference between DDP and door-to-door delivery
Different scope of responsibility
"Home delivery" usually refers to delivering the goods directly from the place of shipment to the address specified by the consignee and completing the delivery. In this process, the main responsibility of the delivery party is transportation, which means that the goods are safely and punctually delivered to the destination. DDP not only includes transportation responsibilities, but also a series of complex responsibilities and obligations such as import customs clearance and tax payment.
Different risk-taking
In the case of door-to-door delivery, once the goods leave the place of shipment, the delivery party needs to bear the risk of possible loss, damage, and other risks that may occur during transportation. Under DDP terms, the seller not only bears transportation risks, but also risks that may arise during import customs clearance, tax payment, and other processes. This type of risk taking has a wider and more complex scope.
Different cost sharing
The cost of door-to-door delivery usually only includes direct costs such as transportation and possible loading and unloading costs. Under the DDP term, the expenses that the seller needs to bear not only include transportation costs, but also import taxes and fees such as tariffs, value-added tax, and handling fees. These expenses often account for a significant proportion and have a significant impact on the financial condition of the seller.
3, Application scenarios and advantages of DDP
Although the seller bears significant responsibility and risk under DDP terminology, DDP still has its unique advantages in certain specific scenarios. For example, when the buyer is not familiar with the import regulations and tax policies of the destination country, choosing the DDP term can avoid risks and losses caused by not understanding the relevant regulations. In addition, DDP can improve the efficiency and convenience of transactions, enabling buyers to receive goods and put them into use more quickly.
