Importer’s guide · Incoterms 2020

Whoever arranges the freight decides who is in charge.

It is the decision made before quoting and the one that most determines the final cost of your import. This page explains the three ways of buying, what you gain and give up in each, and how to ask your supplier to quote you ex works.

See the text for your supplier Compare the three scenarios

The starting point

There is only one question that matters.

In every import someone arranges the international transport. That someone chooses the forwarder, the carrier, the route and the price. And whoever does not arrange it, does not see it.

The usual scenario

Your supplier arranges it

The freight comes included in the price of the goods. It sounds convenient, which is why it is the most common scenario.

The supplier chooses the forwarder, and that forwarder works for them, not for you
The freight is blended into the unit price: you do not know how much you are paying for transport
You cannot compare rates or negotiate the international leg
If the cargo is delayed, your contact is the supplier, who is twelve time zones away
Local charges appear at destination that nobody quoted and that you still have to pay
You cannot consolidate with other suppliers: each one ships on their own

What we recommend

You arrange it

You buy the goods without freight and the chain is operated by DUCIS, with you as the principal.

You see the transport cost separately from the cost of the goods
You can quote the freight with whoever you want, every time
A single point of contact in your language and time zone, responsible end to end
All charges are on the table before shipping
You can bring several suppliers together in a single shipment
You decide the route according to what you need: faster or cheaper

The three scenarios

How much control you keep in each way of buying.

Seen from the buyer’s side, the eleven Incoterms 2020 boil down to three practical situations.

DDP · DAP

The supplier arranges and pays for all the transport

The goods arrive at your warehouse and you had no say at any stage. The price includes freight you never saw itemized and a margin you cannot audit. If something is delayed, there is nobody to call: the transport contract is not yours. Under DDP the supplier also handles the import clearance, something many foreign suppliers cannot do correctly in Chile.

Control 1/10

CIF · CFR · CPT · CIP

The supplier arranges the main freight; you take over from the port

The middle scenario and the most misleading one. You receive the cargo at the destination port, but the transport contract still belongs to the supplier. Local charges at destination —deconsolidation, issuing fees, storage, gate out— are paid by you, at the rate set by the agent your supplier chose. This is where cost surprises appear.

Control 4/10

EXW · FOB · FCA

You arrange the transport, DUCIS operates it

The supplier quotes only the goods. You arrange the transport and the cargo agent answers to you. You see every cost component, choose the route, can consolidate with other suppliers and have a single point of contact from the factory to your warehouse. It is how most of our clients operate.

Control 10/10

All eleven, one by one.

Select an Incoterm and see exactly what your supplier covers, what is left to you and when the risk becomes yours.

Any mode of transport

Sea and inland waterway only

FOB

Free On Board

Sea and inland waterway onlyRecommended by DUCIS

The supplier covers everything until the cargo is on board, and you nominate the forwarder for the rest. It is the balance point most used by importers who want control.

TransportSeller up to “Origin THC”, then buyer

InsuranceNot required by the Incoterm

Import dutiesPaid by the buyer

1Inland transport · at origin
2Export clearance · origin charges
3Origin THC · loading on board
4International freight · transit
5Destination THC · unloading
6Destination charges · terminal
7Transport and delivery · last mile

Covered by the sellerLeft to the buyerPoint where risk transfers

DUCIS operates shipments under all eleven Incoterms, including DAP and DDP. The difference is that before quoting them we explain what visibility you give up by choosing them.

OPTION 01

EXW — pickup at the factory

The supplier only makes the cargo available at their plant. We coordinate everything else. It is maximum control and where the cost difference is most noticeable.

Best when the supplier is small or new to exporting, when you buy from several suppliers in the same area, or when you want to know exactly what each leg costs.

Pickup at the plantWe coordinate the date, the truck and the type of cargo with our agent at origin. You only confirm that the goods are ready.
Export clearance at originMany suppliers do not handle it well. Our agent takes care of the customs paperwork in the country of departure.
Consolidation or container loadingIf there is more than one supplier, the cargo is brought together at an origin warehouse before shipping.
International freightOcean, air or road depending on what suits the volume, weight and urgency. We show you the alternatives with their transit times.
Import clearance at destinationCustoms, local charges and transport to your warehouse, with the detail of each charge before it is incurred.

OPTION 02

FOB and FCA — handover at origin

The supplier takes the cargo to the origin port, airport or terminal and clears it for export. From there, DUCIS operates.

Best when the supplier has export experience and the cost of the inland leg at origin is reasonable. It is the balance point between control and simplicity, and the most used for imports from Asia.

Watch the difference: FOB only applies to sea cargo. For air, road or a container delivered to a terminal, the correct term is FCA. Asking for “air FOB” is a frequent mistake that leads to disputes about who pays what.

The supplier delivers to the terminalThey take the cargo to the agreed port or airport and handle the export clearance.
Receipt by our agentWe check packages, dimensions and documents before shipping, not after.
International freightContracted by you through us, at a rate and route that you approve.
Clearance and deliveryCustoms, local charges and last mile to your warehouse.

The practical part

How to ask your supplier.

The conversation often stalls because the supplier is used to quoting with freight included. These two texts solve ninety percent of cases. Copy the one that applies and send it as is.

To request an EXW quote

Dear Supplier,

Please quote this order EXW your factory, excluding freight and export charges. We arrange the international transport with our own freight forwarder.

Please confirm the following so we can schedule the pickup:
· Exact pickup address and contact person
· Number of packages, dimensions and gross weight per package
· Whether the cargo is palletized and stackable
· Earliest date the goods will be ready
· HS code and commercial invoice value

Our forwarder will contact you directly to coordinate collection.

To request an FOB or FCA quote

Dear Supplier,

Please quote this order FOB [origin port name] for sea freight, or FCA [terminal or airport] for air and road freight. We arrange the international transport with our own freight forwarder.

Please confirm:
· Port or terminal of departure
· Number of packages, dimensions and gross weight
· Earliest date the goods will be ready
· HS code and commercial invoice value
· Any local charges at origin that are not included in your price

Our forwarder will contact you to coordinate the booking.

If the supplier insists on quoting CIF or DDP, still ask for the EXW or FOB price to compare. The difference between the two prices is what they are charging you for transport. With that number you can decide with data.

The advantage that only exists if you are in control

Multi-supplier consolidation.

If you buy from three suppliers in the same region and each ships on their own, you pay three freight charges, three sets of shipping documents and three customs clearances. When you control the logistics, that becomes one.

Buying DDP or CIF

Three separate shipments

Supplier A→Freight 1→Clearance 1

Supplier B→Freight 2→Clearance 2

Supplier C→Freight 3→Clearance 3

Each supplier arranges on their own and nobody coordinates the dates. Three freight invoices, three sets of local charges, three clearances with their fees. The cargoes arrive in different weeks.

Buying EXW or FOB

A single shipment

Supplier A

Supplier B→Origin warehouse→One freight→One clearance

Supplier C

We pick up from the three suppliers, consolidate at an origin warehouse and ship as a single load, with one transport document and one customs clearance. Everything arrives together and you receive a single cost.

Frequently asked questions

What people ask us before switching.

My supplier says they get a better freight rate than I do. Is that true?

Sometimes it is, especially if they are a large exporter with their own volume. The way to find out is simple: ask them for the EXW or FOB price as well as the CIF. The difference between the two is what they charge you for transport. Compare it with our quote for the same shipment. If your supplier really does get a better rate, you will see it in the number and there is no reason to change. In practice, that difference usually includes a margin that is not declared.

Isn’t it more work for me to coordinate the transport?

No, because we do the work. You confirm the goods are ready and we coordinate pickup, documentation and shipping with the supplier. What changes is not the operational workload but who answers to you: under EXW or FOB the forwarder is your service provider, not your goods supplier’s.

What if my supplier refuses to quote EXW or FOB?

It is uncommon and almost always gets resolved. The real reasons tend to be two: they do not know how to break down the price, or the freight is part of their margin. In the first case the text on this page settles the conversation. In the second, the refusal itself is valuable information about how much you are overpaying. If the supplier is strategic and will not budge, FOB is usually the acceptable middle ground for both.

What is the real difference between FOB and FCA?

FOB only applies to sea transport, and the seller’s responsibility ends when the cargo is on board the vessel. FCA applies to any mode and ends when the seller hands over the cargo at the agreed place, which can be a terminal, an airport or even your own plant. For air freight, road freight or containers delivered to a depot, the correct term is FCA. Using FOB in those cases leaves a gap over who bears the terminal charges, and that is where disagreements appear later.

Can I arrange the insurance myself?

Yes, and it is advisable. When the supplier arranges the freight under CIF, the insurance is usually the mandatory minimum cover, which covers much less than most people assume. By arranging it yourself, you define the cover according to the value and nature of the cargo. We can handle it as part of the shipment or you can take it out with your own broker.

What if I have been buying DDP for years?

There is no need to change everything at once. The usual approach is to start with one shipment from one supplier and compare the result with what you were paying. If the number confirms what you expected, it is extended to the rest. If not, you lost nothing. We also operate DAP and DDP when it makes sense for a specific operation.

Next step

Bring us a shipment and compare.

Send us the details of a purchase you currently make under CIF or DDP. We quote you the same shipment under EXW or FOB, with each cost component separated, so the comparison is about numbers and not arguments.

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