Incoterms define exactly where the seller's responsibility ends and yours begins. Picking the wrong one can quietly erode your margin through unexpected freight, insurance or customs costs. Here is how the five most-used terms work in practice.
EXW — Ex Works
You collect the goods at the seller's premises and handle everything thereafter. Maximum control, maximum responsibility — best for experienced buyers with strong freight partners.
FOB — Free On Board
The seller delivers, clears for export and loads onto the vessel at the origin port. Risk transfers once goods are on board. A popular, balanced choice for container cargo.
CFR & CIF — Cost & Freight / plus Insurance
The seller arranges and pays ocean freight to your destination port; under CIF marine insurance is also included. Convenient when you prefer the exporter to manage the main carriage.
DDP — Delivered Duty Paid
The seller delivers to your door with all duties and taxes paid. The most turnkey option, ideal for landlocked buyers or those wanting a single all-in price.
Our recommendation
New buyers often start with CIF or DDP for simplicity, then move to FOB as their logistics capability grows. We quote all five terms so you can compare landed cost accurately.
