When importing goods from China, understanding shipping terms is essential for controlling costs, responsibilities, and delivery risks. The four most commonly used Incoterms are EXW, FOB, CIF, and DDP. Each term defines who is responsible for transportation, customs procedures, insurance, and delivery at different stages of the shipment.
Choosing the right shipping term can help your business reduce risks and improve supply chain efficiency.
What Is EXW (Ex Works)?
Under EXW (Ex Works), the seller makes the goods available at their factory or warehouse. The buyer is responsible for almost every part of the shipping process.
Buyer responsibilities usually include:
- Pickup from the supplier
- Inland transportation in China
- Export customs procedures
- International freight
- Import customs clearance
- Import duties and taxes
- Final delivery
Best for: Experienced importers with their own freight forwarding arrangements.
What Is FOB (Free On Board)?
FOB is one of the most popular shipping terms in international trade.
Under FOB:
- The seller prepares the goods for export.
- The seller completes export customs clearance.
- The seller delivers the cargo to the designated port and loads it onto the vessel.
- The buyer is responsible for ocean freight, import customs clearance, duties, and final delivery.
Best for: Importers who want greater control over international shipping while allowing the supplier to manage export procedures.
What Is CIF (Cost, Insurance and Freight)?
With CIF shipping:
- The seller arranges ocean freight to the destination port.
- The seller provides marine insurance according to the applicable Incoterms requirements.
- The buyer is generally responsible for import customs clearance, import duties, local charges at destination, and inland delivery after the cargo arrives.
Best for: Buyers who prefer the seller to arrange the main ocean transportation while handling import procedures themselves.
What Is DDP (Delivered Duty Paid)?
DDP is one of the most convenient shipping terms for many importers.
Under DDP, the freight forwarder or seller (depending on the agreement):
- Arranges transportation
- Manages export procedures
- Coordinates import customs clearance
- Handles agreed duties and taxes
- Delivers the cargo to the final destination
This provides a simple door-to-door shipping solution with fewer logistics tasks for the buyer.
Best for: First-time importers, e-commerce sellers, and businesses looking for a hassle-free shipping experience.
Which Shipping Term Should You Choose?
Your choice depends on your experience and business needs.
Choose EXW if you have an experienced logistics team and want full control of the shipping process.
Choose FOB if you want your supplier to handle export formalities while you manage international transportation.
Choose CIF if you prefer the seller to arrange ocean freight to the destination port.
Choose DDP if you want a complete door-to-door logistics solution with minimal coordination.
Tips for Selecting the Right Shipping Term
Before confirming your order:
- Compare total shipping costs, not just product prices.
- Understand which party is responsible at each stage.
- Confirm who arranges customs documentation.
- Check whether insurance is included.
- Discuss delivery timelines with your freight forwarder.
Working with an experienced China freight forwarder can help you choose the most suitable shipping term for your shipment.
Frequently Asked Questions
Which shipping term is best for beginners?
Many first-time importers choose DDP because it simplifies transportation and customs coordination.
Is FOB cheaper than DDP?
Not necessarily. FOB and DDP include different responsibilities and cost components. The best choice depends on your shipment, destination, and logistics requirements.
Does CIF include import duties?
No. Under CIF, buyers are generally responsible for import duties, taxes, customs clearance, and local destination charges.
Can a freight forwarder explain which Incoterm is right for my shipment?
Yes. An experienced freight forwarder can recommend the most appropriate shipping term based on your cargo, destination, delivery schedule, and budget.
Request a Shipping Solution
If you are unsure whether EXW, FOB, CIF, or DDP is the best choice for your shipment from China, send us your product details, shipment size, pickup location, and destination. Our experienced logistics team will recommend the most cost-effective and efficient shipping solution for your business.