What is Quotation? Meaning of Quotation ↓
A Quotation is a concern offer made past times a seller to an interested buyer to sell for sure goods at specific prices together with on for sure terms together with conditions.
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It is a respond past times the seller to the prospective buyer. Hence, the quotation missive of the alphabet should live on prepared carefully past times the seller. It should comprise data on all points mentioned inward the question letter.
The seller should post the best possible quotation thus that it induces the buyer to house an lodge because it is the footing on which the interested buyer decides whether to purchase or not.
The quotation must live on clear, courteous together with concise.
Contents of Quotation ↓
The quotation may comprise the next points :-
- Details most lineament of goods offered for sale.
- Details most quantity of goods offered for sale.
- Type of quotation.
- Sale cost per unit of measurement of the commodity.
- Term of payment similar Cash or Credit, merchandise discount, cash discount together with other allowances if any.
- Time, way together with house of delivery.
- Details of duties, Octroi, etc., payable.
- Details of packing, labelling, insurance, etc.
- Net cost payable.
- E together with O.E. (errors together with omissions expected)
Kinds / Types of Quotations ↓
Following are the psyche kinds or types of quotations :-
1. Loco Price Quotation
Loco agency 'On the spot'. Therefore, the loco cost refers to the cost of goods at the mill or godown of the seller. Once the goods are out of the sellers' mill or warehouse, all the expenses for carrying the goods from the seller's warehouse to the buyer's house are to live on borne past times the buyer. This is the lowest cost quotation.
2. Station Price Quotation
Under this quotation, seller's responsibleness is to post the goods to the nearest railway station from his warehouse. It includes the cost of railroad vehicle of goods to the station. Since he delivers the goods upto the station, he charges a picayune higher price. All farther expenses on goods such equally freight, insurance, etc. accept to live on borne past times the buyer.
3. Free On Rail (FOR) Price Quotation
Free On Rail (FOR) cost quotation covers the expenses of carrying the goods to the railway station nearest to seller summation the loading expenses, freight together with unloading expenses are to live on borne past times the buyer.
FOR cost quotation = Station cost quotation + Loading Charges
4. Cost together with Freight (C & F) Price Quotation
Cost together with Freight (C & F) cost quotation includes the cost of the goods together with all the expenses similar railroad vehicle to the seller's nearest station, dock together with loading charges together with freight. Expenses similar insurance, unloading together with cartage to the buyer's house are to live on borne past times the buyer.
C & F cost quotation = FOR cost quotation + Railway Freight.
5. Cost Insurance together with Freight (CIF) Price Quotation
There is a run a hazard involved inward transporting goods together with this run a hazard is covered past times insurance. Generally, the buyer pays insurance charges simply if CIF quotation is mentioned together with thus the seller pays for the insurance charges along amongst other previous mentioned prices. So, the cost includes cost of the goods summation railroad vehicle upto seller's nearest station, loading, freight together with insurance charges.
CIF cost quotation = C & F cost quotation + Insurance.
6. Franco Price Quotation
Franco cost quotation is the highest cost quotation. Inspite of beingness the highest quotation, buyers prefer this quotation because nether this price, the goods are delivered to the buyers at their door-step. The buyer is relieved from the tension of transporting goods from the seller's warehouse to his ain warehouse.
Franco cost quotation = All expenses upto the buyer's warehouse.
7. Free Alongside Ship (FAS) Price Quotation
Free Alongside Ship (FAS) cost quotation includes the cost of the goods together with all the expenses to deliver the goods at the dock nearest to the seller. The buyer has to acquit the expenses of loading, insurance, freight together with the customs duty, etc., inward add-on to the cost of goods. Though this quotation is used inward around countries, it is non inward operate inward India.
FAS cost quotation = Loco cost quotation + cost of railroad vehicle of goods upto the harbour nearest to the seller.
8. Free On Board (FOB) Price Quotation
Free On Board (FOB) cost quotation is similar to FOR inward inland trade. This is commonly used inward unusual trade. Under FOB quotation, the seller quotes a cost which includes all the expenses incurred untill the goods are truly delivered on board the ship at the port of shipment.
FOB cost quotation = cost of goods + expenses upto goods on ship's board.
9. Cash With Order (CWO) Price Quotation
In Cash With Order (CWO) cost quotation, the buyer has to post cash along amongst the order, otherwise, the lodge may non live on executed.
10. Cash On Delivery (COD) Price Quotation
In Cash On Delivery (COD) cost quotation, the buyer has to pay cash later receiving the delivery of the goods ordered past times him.
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