Best Incoterms

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  Seller’s Responsibility: The seller delivers goods to the port of departure, handles export customs, and loads them onto the ship.
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  Buyer’s Responsibility: Once the goods are loaded onto the ship, the buyer assumes responsibility for transportation, shipping costs, insurance, and customs clearance at the destination.
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  Best for: Buyers who want more control over shipping costs, transit times, and routing, and prefer to manage the freight forwarding process themselves.
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  Typical Use: Common for ocean freight.

Advantages of FOB:

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  Offers control over shipping costs and timing.
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  Buyers can choose their preferred freight forwarders.
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  Provides transparency on the shipping process.

Disadvantages:

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  The buyer takes on all responsibility for the shipment once it’s on the ship, including any risks during transit.

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  Seller’s Responsibility: The seller arranges and pays for shipping and insurance up to the destination port.
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  Buyer’s Responsibility: Once the goods reach the destination port, the buyer assumes responsibility for unloading, customs clearance, and delivery.
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  Best for: Importers with trusted suppliers or those who want a simplified, low-risk process but are willing to pay a premium for convenience.

Advantages of CIF:

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  Minimizes the buyer’s risk, as the supplier handles shipping and insurance.
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  The buyer doesn’t have to worry about handling logistics until the goods arrive at the destination port.

Disadvantages:

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  Higher cost due to the supplier’s shipping and insurance arrangements.
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  The buyer has limited control over the shipping process, such as the choice of insurance and shipping company.

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  Seller’s Responsibility: The seller’s responsibility ends when the goods are made available for pickup at their premises (or another agreed location).
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  Buyer’s Responsibility: The buyer is responsible for arranging and paying for all transportation, export customs, risks, and delivery costs.
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  Best for: Experienced importers who have their own logistics network and want the lowest possible cost.

Advantages of EXW:

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  Full control over shipping, including choosing the freight forwarder and transportation options.
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  Potentially lower costs if the buyer can manage logistics efficiently.

Disadvantages:

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  The buyer is responsible for all risks and costs from the point of pickup, including export customs clearance and transportation from the seller’s location to the destination port.

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  Seller’s Responsibility: The seller is responsible for all costs, including delivery to the buyer’s location, customs clearance, import duties, and taxes.
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  Buyer’s Responsibility: The buyer simply receives the goods at the agreed destination, without handling any customs or import duties.
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  Best for: Buyers who want a simple and risk-free process, where all responsibilities are handled by the supplier.

Advantages of DDP:

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  The buyer bears minimal risk and responsibility, as the seller handles everything.
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  No need for the buyer to deal with customs clearance, taxes, or duties.

Disadvantages:

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  DDP is typically the most expensive Incoterm due to the seller’s extensive responsibility.
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  Limited control over shipping choices and delivery timing.

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  Seller's Responsibility: The seller delivers the goods to the agreed destination, handling all shipping.
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  Buyer's Responsibility: The buyer is responsible for import customs clearance.
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  Best for: Buyers who want specific location delivery but handle duties themselves.

Advantages of DAP:

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  Simplifies the shipping process, as the seller manages most responsibilities.
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  The buyer only needs to handle import customs clearance.

Disadvantages:

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  The buyer still bears some responsibility for customs duties.