Two chairs with the same unit price can land at wildly different costs depending on the Incoterm. The term isn’t paperwork — it’s the exact point where risk and cost transfer from the factory to you. Here is how to read the three importers actually use.
What an Incoterm really controls
An Incoterm (International Commercial Term) divides responsibility for transport, insurance, and the risk of loss between seller and buyer. Pick the wrong one and you either overpay for a service the factory marks up, or inherit risk you didn’t budget for. The three you’ll meet most for furniture are EXW, FOB and CIF.
EXW — Ex Works: lowest quote, most risk on you
Under EXW the factory’s only job is to have the goods ready at its dock. You arrange pickup, export clearance, freight, insurance and import. The quote looks cheapest because it excludes almost everything — but you now own every link and every point of failure. EXW suits experienced importers with their own freight forwarder.
FOB — Free On Board: the importer-friendly default
FOB is the standard for furniture importing. The factory delivers to the port of loading, handles export clearance, and loads the container. Risk transfers when the goods are on the vessel; from there you book and pay ocean freight and insurance. You keep control of the freight (and the margin) while the factory handles the local leg. 我们默认 T/T：30% 定金，70% 发货前付清。简单直接，也是大多数买家偏好的方式。
CIF — Cost, Insurance and Freight: convenience at a markup
Under CIF the factory also books ocean freight and insurance to your destination port. It’s convenient — one invoice, less to coordinate — but the factory’s freight rate is rarely your best rate, and you have little visibility or control over the carrier. Pay for ease, not for savings.
Which one protects your margin (a numbers example)
Say the chair FOB is $40 and ocean to your port is $2,800 for a 520-chair container ($5.38/chair). Under CIF the factory might quote $47/chair ‘delivered to port’ — burying freight at $7/chair and pocketing the difference. FOB lets you negotiate freight yourself and keep that $1.62/chair. Over a 5,000-chair yearly program that’s about $8,100 back in your margin.
How to choose per order
First import or no forwarder → CIF for simplicity. Want control and best freight → FOB (the norm). EXW only if you already run your own logistics. Whatever you choose, confirm it in writing alongside the payment terms so there’s no ambiguity on who pays what.
Frequently Asked Questions
Which Incoterm is best for a first-time importer? CIF for simplicity (factory handles freight), or FOB with a freight forwarder you trust. Avoid EXW until you run your own logistics.
Does FOB include import duty? No — FOB ends at the origin port. Import duty, VAT and last-mile are always the buyer’s, under any term.
Need the exact numbers for your project?
The figures above are industry baselines. For a real quote — loading count for your specific model, MOQ, lead time and certifications for your market — contact our sourcing team with your target specs.