FOB vs CIF vs EXW

Inside - FOB vs CIF vs EXW $500 Profit Difference Foundation (1-9): Recap FOB till on board CIF till destination port with freight + insurance EXW at factory only, Why matters $1000 mistake FOB $1.6 buyer thought CIF $1.6 you pay freight $0.3 loss $300 1000 pcs, EXW $1.3 buyer thought FOB $1.3 you pay inland $0.05 CHA $0.07 loss $120, CIF $1.92 buyer thought FOB $1.92 extra $0.32 profit $320, FOB explained till on board seller ex + packing + inland + CHA + port till on board buyer freight insurance import risk on board cost on board sea only 80% MSME use technically FCA better example FOB JNPT $1.6 jute, CIF explained till destination port seller FOB + freight $0.3 + insurance $0.02 $1.92 risk on board same as FOB cost till destination seller pays freight insurance sea only buyer likes one price, EXW explained minimum seller only makes available at premises factory no loading no export customs no freight buyer everything loading inland export freight insurance import duty risk at factory cost at factory any mode example EXW Tiruppur $1.3 avoid MSME buyer may ask free export customs loss, Side by side table who pays what ex-factory EXW seller makes available buyer loads FOB seller includes ex packing inland CHA port till on board $1.6 CIF seller FOB freight insurance $1.92 inland EXW buyer $0.05 FOB seller $0.05 CIF seller $0.05 export CHA EXW buyer $0.07 FOB seller $0.07 CIF seller $0.07 port till on board EXW buyer $0.03 FOB seller $0.03 CIF seller $0.03 freight EXW buyer $0.3 FOB buyer $0.3 CIF seller $0.3 insurance EXW buyer $0.02 FOB buyer $0.02 CIF seller $0.02 import customs buyer all duty buyer all total seller EXW $1.3 FOB $1.6 CIF $1.92 buyer $0.62 $0.32 $0, Risk transfer EXW at factory FOB on board vessel loading port CIF on board same as FOB even though seller pays freight till destination if damaged after on board risk buyer buyer claims insurance seller provided EXW earliest factory, Cost transfer EXW at factory buyer everything after FOB on board seller till on board buyer after CIF till destination port seller till destination buyer after example jute 1000 pcs same total $1.92 different split Live Costing (10-15): FOB costing ex $0.9 packing $0.1 $1.0 inland Tiruppur JNPT $0.05 CHA $0.07 port $0.03 profit $0.35 FOB JNPT $1.6 FOB value GST RoDTEP e-BRC freight buyer $0.3 insurance buyer $0.02 CIF equivalent $1.92 seller profit $0.35 margin 28% investment till FOB $1.25 no freight, CIF costing FOB $1.6 freight $0.3 insurance 110% CIF $1.92 x 110% $2.11 insurance 0.5% $0.01 round $0.02 CIF Felixstowe $1.92 profit same $0.35 seller investment till CIF $1.92 need extra $0.32 working capital vs FOB but quote higher $1.92 buyer pays freight seller can add freight margin $0.05 extra profit forwarder $0.25 keep $0.05, EXW costing ex $0.9 packing $0.1 profit $0.3 EXW $1.3 seller investment $1.0 buyer pays inland $0.05 CHA $0.07 port $0.03 freight $0.3 insurance $0.02 $0.47 extra buyer total $1.77 vs FOB $1.6 CIF $1.92 profit less $0.18 less margin avoid EXW, Profit comparison FOB $0.35/pc 1000 pcs $350 CIF $0.35+freight margin $0.05 $0.40 $400 extra $50 EXW $0.30 $300 less $50 CIF max profit $400 if cheap forwarder $0.25 vs buyer $0.3 keep $0.05 FOB middle $350 EXW lowest $300 recommendation quote both FOB $1.6 CIF $1.92 buyer chooses never EXW only, Working capital EXW lowest $1.0 FOB medium $1.25 CIF highest $1.92 1000 pcs EXW $1000 FOB $1250 CIF $1920 low capital 50k quote FOB not CIF with advance 50% $960 of CIF $1920 covers ex $1000 inland CHA port $150 $1150 need $190 extra manageable, Freight who pays EXW buyer FOB buyer CIF seller who chooses forwarder EXW buyer FOB buyer CIF seller forwarder quotes JNPT Felixstowe LCL 1 CBM $280 $300 $320 choose $280 keep margin $20 vs buyer $300 if CIF you choose forwarder get 3 quotes if FOB buyer chooses no control no risk freight increase FOB better no freight risk CIF better if good forwarder cheap, Insurance who pays EXW buyer FOB buyer CIF seller 110% mandatory cost 0.5% $10 for $2000 coverage Clause C CIF 110% minimum FOB EXW buyer should take but may not risk no insurance damaged buyer may refuse payment recommendation even FOB EXW take insurance safety charge buyer $0.02 small saves $1.6 loss if container sinks UCP Article 28 110% CIF CIP