Title: Analysis of COD and DDP Models: Differences and Risk Management

Title: Analysis of COD and DDP Models: Differences and Risk Management

A deep understanding of the differences between COD and DDP helps enterprises make correct choices and effectively manage risks in cross – border trade.

Main Differences:

• Liability Boundaries: The liability of COD sellers ends at the agreed delivery location of the goods. DDP sellers are required to deliver the goods intact to the buyer and complete all import procedures, with the liability scope extending to the territory of the importing country.
• Tax Handling: Tax payment in COD is the responsibility of the buyer. DDP sellers must accurately calculate and pay various taxes in the importing country, requiring extremely high tax knowledge and operation capabilities.

Precautions:

• COD: Formulate clear return and exchange policies, clarify the conditions, processes, and cost – bearing parties for returns and exchanges, and avoid disputes with buyers due to return and exchange issues. At the same time, pay attention to the settlement cycle and handling fees for cash collection to ensure fund security and income.
• DDP: Regularly pay attention to changes in policies and regulations of the importing country, and adjust customs clearance strategies and cost budgets in a timely manner. During transportation, purchase sufficient insurance for the goods to reduce economic losses caused by unexpected events.