Importing Linen: FOB, CIF, LC, TT and the Documents

FOB, CIF and CNF side by side

The three terms differ in how far the seller's price reaches. Nothing else changes: the goods, the specification and the packing stay the same.

Which term should you ask for?

It depends on whether you already have a freight rate. There is no better term, only a term that fits how you buy.

If you work with a freight forwarder and hold a contracted rate, FOB usually serves you better. You keep control of the routing, and you pay the rate you negotiated rather than one passed through.

If you would rather see one figure that lands the container at your port, ask for CIF or CNF. The quotation is then simpler to compare against a domestic supplier's price.

One caution on comparing quotations. An FOB price and a CIF price for the same linen are not comparable figures. Check which term each quotation is written on before you judge them.

How LC and TT differ

An LC is a letter of credit: your bank undertakes to pay once the shipping documents match what the LC asks for. A TT is a telegraphic transfer, a bank to bank payment.

Under an LC the bank sits between the two sides. The seller ships, presents the documents, and the bank pays against them. The documents have to match the LC exactly, so the wording is agreed before the LC is opened.

A TT is faster and costs less in bank charges. There is no bank checking the documents, so it rests on the working relationship between buyer and seller.

We accept LC or TT. Which one suits you is usually decided by your bank and by whether this is a first order or a repeat.

Which documents travel with the container

Four documents go with every shipment we send. Your customs broker needs them to clear the goods, and your bank needs them if you are paying by LC.

• Commercial Invoice: what was sold, at what value, on what terms. Customs assess duty from it.
• Packing List: what is in each carton and how the container is loaded. Your warehouse checks the delivery against it.
• Bill of Lading: the carrier's document for the cargo. It is also the document that releases the container at your port.
• Certificate of Origin: where the goods were made. Some markets need it to apply a duty rate.

Standards and test reports

Tell us the standard or test report your market needs, and we arrange it with your order.

OEKO-TEX STANDARD 100 is the one asked for most often on textiles. It is a test for harmful substances, carried out on the finished article by an authorised institute. It is a test result, not a quality grade: it says nothing about thread count or towel weight.

Public buyers and hospital groups sometimes ask for a flammability or a colour fastness report instead, or for a report under their own national standard. These are tests on the goods as well, so the requirement belongs in the specification before production starts, not after. Hospital bed sheets and draw sheets are the lines where this comes up most.

Samples, and how the order size works

Samples are available before production. This is the point to settle the specification, because changing it after the run has started is not practical.

If you are matching linen you already use, send one piece of each item. We read the fabric and the construction from it. That is a closer match than a written specification on its own. The choices on each item sit on its own page, such as flat sheets, fitted sheets and bath towels.

Minimum order is one 20ft container. You can mix products in the same container, as long as the order fills it and each product runs at three to four thousand pieces or more. A mixed container often carries bed linen, table linen and towels on one order.

We also hold stock in Australia and New Zealand, and hospitals, laundries and accommodation groups order from it. Smaller orders can ship from that stock. Ask us what is in the warehouse.