Overview of the Situation
Bolloré Logistics Canada provides a variety of logistics services, including international maritime shipping. In 2019, the company was involved in a case that focused on the use of Incoterms in international trade transactions (Vincenti & Roy, 2017). Specifically, the case entailed a shipment of industrial machinery from Canada to Saudi Arabia, where the parties had agreed to use the FOB Incoterm, which outlined the seller’s responsibility for goods until they were loaded onto the vessel.
During the shipment, the machinery arrived late and was damaged, leading to a dispute between the buyer and the seller over who was responsible for the repairs. The court ruled in favor of the seller and posited applying Incoterms in international trade transactions to prevent disputes (Vincenti & Roy, 2017). However, in cases where issues with the shipment itself arise, other legal principles such as negligence or breach of contract may need to be relied upon to determine liability.
Managerial Issues
The Bolloré Logistics Canada case has brought up several managerial issues. Firstly, it highlights the significance of accurately interpreting and applying Incoterms in international trade transactions to avoid misunderstandings or disputes. Secondly, it highlights the need for proper handling of goods during transportation to avoid damage or delays, which is critical for customer satisfaction and reducing potential financial losses.
The other issue, as highlighted by Vincenti and Roy (2017), is that the case reveals the significance of effective communication with customers to ensure that all parties understand their responsibilities and obligations in the transaction. Bolloré Logistics Canada needs to establish efficient communication channels with customers and guarantee that the transaction’s terms are clearly defined and understood by all parties involved to avoid any misunderstandings or potential disputes.
Alternative Solutions
The managerial issues can be addressed through alternative solutions. However, the recommended Incoterm based on the perspectives of the buyer and seller varies in each case. In the Bolloré Logistics Canada case, EXW is suggested as the suitable Incoterm due to the long distance between the buyer and seller (Vincenti & Roy, 2017).
The buyer will control shipping arrangements and costs, while the seller will only be responsible for making the product available at the right time and destination. For the ProLab+ and Clinica Alana case, FCA is recommended, giving Clinica Alana the flexibility to choose the best transportation mode. ProLab+ will bear the risk and cost of the product’s shipment until delivery. In the Cirque Hemisphere and Athens Theatre case, CFR is the proposed Incoterms. The seller will arrange transportation but will no longer be liable to insure the shipment, benefiting the buyer and increasing the likelihood of future contracts.
Recommended Solution
Justifying a recommended solution can help to anticipate and address potential objections or concerns. EXW is the most appropriate Incoterm for the Atlas mining and Amiko mine case as it transfers the cost and risk to the buyer, with the seller only being responsible for product availability at the right place and time. FCA is best for ProLab+ and Clinica Alana, allowing the buyer to select the best transportation mode while the seller bears the risk and cost of shipment (Vincenti & Roy, 2017). In the case of Cirque Hemisphere and the Athens Theatre, CFR is the most suitable Incoterm, as it transfers the responsibility of goods delivery and expenses to Cirque Hemisphere, building trust and establishing a relationship between the seller and buyer.
Reference
Vincenti, L., & Roy, J. (2017). Bolloré Logistics Canada and the use of Incoterms in international maritime shipping. International Journal of Case Studies in Management (IJCSM), 15(1), 1-17.