Alibaba.com
Free Trade Tools
By Alibaba.com

TRADE TERM PLANNING

Incoterm cost and responsibility compare

Compare the operational scope behind EXW, FOB, CIF, DAP, and DDP before a supplier quote makes one option look simpler than it is.

PLANNING INPUTS

Cost layers for the same shipment

Use your current best planning estimates. The total physical supply-chain cost is comparable across terms; the tool highlights who manages each layer.

This is an operational comparison, not legal or tax advice. Always state the Incoterm version and precise named port or place in the purchase agreement.

COMPARE TERMS

Same shipment, different control points

Total planning cost: $4,700

FOB

Free On Board

Buyer-managed estimate: $1,450

The seller delivers cleared goods on board the vessel at the named port. The buyer controls the main carriage.

Seller arranges

  • Origin handling
  • Export clearance
  • Loading on board

Buyer arranges

  • International freight and insurance
  • Destination delivery
  • Import clearance and taxes

Risk transfers

When the goods are on board the vessel at the named port of shipment.

Confirm before agreeing

Use FOB only for sea or inland-waterway shipments; name the actual loading port.

Incoterm FAQs

Which Incoterm is cheapest?

No Incoterm is automatically cheapest. The same physical shipment still has origin, freight, destination, and tax costs. The difference is who arranges, advances, and manages each step, and where risk transfers.

Does CIF include import duty?

Usually no. CIF typically covers cost, insurance, and freight to the named destination port. The buyer commonly handles destination charges, import clearance, duties, and taxes after arrival.

Is DDP always simpler for the buyer?

DDP can simplify coordination, but it only works well when the seller can legally and operationally manage import clearance and tax in the destination. Confirm the importer-of-record arrangement and exactly which local charges are included.