Your Chinese supplier sends a quote, and at the bottom it says FOB, EXW or CIF. Three letters decide whether that amount is the end of the bill or only the start of it. Below is one order quoted four ways, with no figures at all, so you can see what each quote covers and what is left to you.
First: which edition applies
The current edition is Incoterms 2020, with 11 rules. There is no Incoterms 2026, whatever the search suggestions say. In its 2026 workplan, ICC wrote that it is beginning work on the revision, laying the groundwork for Incoterms 2030. No new rules have been published, and none apply yet.
So in the contract and the proforma, ask for three things together:
- the rule (for example FCA, FOB, CIF);
- the exact named place (a warehouse address, a port name);
- the edition: "Incoterms 2020".
"FOB China" without a port, or "CIF Skopje", is a signal to ask questions. CIF is a sea-only rule and needs a destination port. Skopje, Belgrade and Pristina are not seaports.
Incoterms do not say when or how you pay, or when the goods become yours. ICC states this explicitly. Deposit and balance are agreed separately; see paying a Chinese supplier.
One order, four quotes
Take this order:
- Product: plastic storage boxes, same model and packing in every quote
- Quantity: 600 cartons, about 18 CBM
- Supplier: a factory near Yiwu
- Destination: your warehouse in the Balkans, through Thessaloniki
The supplier offers four versions: EXW factory, FCA or FOB Ningbo, CIF Thessaloniki and DDP your warehouse. Each has a different amount. Before you compare them, check which rows of the table below are already inside each one.
← Scroll to see all columns →
| Cost line | EXW factory | FCA / FOB Ningbo | CIF Thessaloniki | DDP your warehouse |
|---|---|---|---|---|
| Goods and standard packing | supplier | supplier | supplier | supplier |
| Loading at the factory | you | supplier | supplier | supplier |
| Export clearance in China | you | supplier | supplier | supplier |
| Inland transport in China | you | supplier | supplier | supplier |
| Origin terminal charges | you | FCA: you, FOB: supplier | supplier | supplier |
| Sea freight to Thessaloniki | you | you | supplier | supplier |
| Cargo insurance | you, if you want it | you, if you want it | supplier, minimum cover | as agreed |
| Destination port charges | you | you | you, unless in the carriage contract | supplier |
| Import clearance | you, through a forwarder | you, through a forwarder | you, through a forwarder | supplier |
| Customs duty | you | you | you | supplier |
| Import VAT | you | you | you | supplier |
| Delivery to your warehouse | you | you | you | supplier |
| Unloading at your warehouse | you | you | you | you |
The table is for comparing quotes. A supplier may bundle several rows into one figure. Your job is to know which rows are in it, so you neither pay for them twice nor forget them.
Where the risk passes
Cost and risk do not always pass at the same point.
- EXW: risk is yours once the goods are made available at the factory, before loading.
- FCA: risk is yours once the goods are handed to your carrier at the named place.
- FOB and CIF: risk is yours once the goods are on board in China. Under CIF the supplier pays for the ship, but the sea risk is yours.
- DDP: risk stays with the supplier until the named place in your country, import cleared and ready for unloading.
FOB or FCA when the goods travel in a container
ICC says FOB is not appropriate where goods are handed to the carrier at a container terminal before they are on board. In that case it says the parties should consider FCA. The same applies to CIF: for a container handed over at a terminal, the rule is CIP.
In practice it works like this. A full container leaves from the Chinese port nearest the supplier, which can be Ningbo, Shanghai or another port. With us, shared (LCL) cargo first goes into our warehouse in China, where it is collected and checked, and then leaves from Ningbo. Either way, the supplier hands the goods over before they are on board. FCA with an exact handover address describes what actually happens.
You can still accept a FOB quote. Just ask exactly where the supplier hands the goods over and who pays the terminal charges.
Three common mistakes
1. Paying for freight twice
The supplier quotes CIF Thessaloniki. You also ask a forwarder for a price from China to your warehouse and add the two together. The sea leg is now paid twice: once inside the goods price and once to the forwarder.
The same happens in a calculator. If you enter the CIF amount as the goods value and then add freight from China, the ship is counted twice. With CIF, enter in the freight field only what CIF does not cover, such as the destination port charges and the truck from Thessaloniki.
2. Assuming CIF protects you until arrival
CIF sounds like "the supplier looks after it to the destination". It does not. Risk is yours from the moment the goods are on board in China. The supplier only has to buy minimum insurance under Institute Cargo Clauses (C), to the destination port. That is narrower than Clauses (A). For valuable or fragile goods, agree wider cover or buy it yourself.
The supplier made the carriage contract, not you. Under the ICC rules, the policy must entitle you to claim directly from the insurer. Ask for the policy or insurance certificate before you pay the balance.
3. Accepting DDP without knowing who the importer is
DDP to your warehouse looks easiest: one figure, and the goods arrive cleared. Under ICC rules the seller must then clear the goods for import and pay import duty and taxes. ICC also says that a seller who is unable to obtain import clearance should consider DAP or DPU.
Whether a Chinese seller can actually do this depends on the rules in your country. Before you pay a DDP price, ask who will be named as importer and in whose name duty and import VAT are paid. Your forwarder can tell you whether the answer holds up.
If the answers are vague, DAP or FCA with your own forwarder is the cleaner route. Then you know exactly who handles clearance and whose name is on the documents.
Where we fit
If you buy FCA or FOB, you arrange the transport from China, and you can ask us to quote for that part. Our strongest operational presence is in Yiwu, with Ningbo a focus for containers. LCL is charged per CBM, with a minimum of 1 CBM. Weight-based pricing per kg is for air freight.
We do not carry out customs clearance. A forwarder handles clearance, duty and VAT, your own or one we recommend. We deliver the goods to the customs warehouse and hand over the export documents and the documents needed for clearance. Many clients already have their own forwarder. The documents you need are listed in import documents for goods from China, and the split of roles is on customs documents and delivery.
The duty for your exact goods is confirmed by your forwarder.
The freight price for your shipment is in the quote.
Checklist before you accept a quote
- It states the rule, the exact named place and "Incoterms 2020".
- I know which rows of the table are inside the supplier's amount.
- I know where risk passes and whether the goods are insured after that.
- For CIF, I have seen the policy and know what it covers.
- For DDP, I know who the importer is and in whose name duty and VAT are paid.
- Payment terms are agreed separately, not through the Incoterm.
Next step: run your quotes through the calculator
Take the quotes you have and enter the amounts in the landed cost calculator. Enter each cost once. For DDP, do not add duty and VAT again if the documents show they have been paid. If you need transport from China for an FCA or FOB order, send the carton dimensions, gross weight, product details and the supplier's handover place through the contact form, so we can agree the right transport type.
