The Big Three: FOB, CIF, DDP
Incoterms define who pays for shipping and who takes the risk. Here are the 3 most common for tool importers:
FOB (Free On Board)
We deliver to the China port. You handle the sea freight, insurance, and everything after.
CIF (Cost, Ins, Freight)
We pay sea freight to your port. You handle customs clearance and delivery to your warehouse.
DDP (Delivered Duty Paid)
We do everything. Sea freight, Customs, Duty, Tax, and Truck delivery to your door.
FOB: The Illusion of "Cheap"
Many new buyers ask for FOB prices because they look lower.
Example: An FOB Drill Bit set might be $10.00. The DDP price might be $13.50.
You think you are saving $3.50. But you aren't accounting for:
- Freight Forwarder fees (often higher for small shipments).
- Customs Broker entry fees ($100+ per entry).
- ISF Filing fees (USA).
- Port congestion surcharges.
- Import Duty (Tariffs).
Often, doing it yourself ends up costing $14.00+, plus hours of paperwork.
Why We Recommend DDP
For orders under one full container (LCL), DDP is usually the winner.
We consolidate your shipment with our other large shipments. This gives us bulk shipping rates that you cannot get as an individual buyer. We handle the customs headache. You just receive the goods.
Importer's Checklist
Before you sign, ask these questions:
- Is the pallet wood treated? (Yes, we use fumigated plywood pallets compliant with IPPC).
- Do you have HS Codes? (Yes, we provide the correct HS Codes for lower tariffs).
- Is insurance included? (Included in CIF and DDP).
