When importing from China—whether you’re an Amazon FBA seller, running an e-commerce brand, or managing a small trading business—the right shipping term can significantly impact your costs, timelines, and stress levels.
Terms like DDP, FOB, and EXW sound simple, but they determine who handles what in the supply chain, from factory pickup to final delivery. As a freight forwarder with 11+ years helping global importers, I’ve seen countless cases where the wrong choice led to unexpected fees, delays, or customs issues.
This guide breaks down DDP, FOB, and EXW in plain English, with real-world insights for shipping from China to the USA, Canada, Europe, or beyond. (For a full overview of all 11 Incoterms, check our previous post 11 shipping trade terms explained)
What Is FOB (Free On Board)?
FOB is the most popular shipping term for China imports—and for good reason.
Under FOB, the Chinese supplier handles everything up to the point the goods are loaded onto the ship or plane at the origin port.
Supplier’s Responsibilities (China Side):
- Trucking from factory to port
- Export customs clearance
- Origin terminal handling charges (THC—though some suppliers exclude this, so always confirm)
- Loading onto the vessel
Your Responsibilities as Buyer:
- Ocean or air freight
- Destination port fees
- Import customs clearance, duties, and taxes
- Final delivery to your warehouse or Amazon center
Why FOB Is a Favorite for Many Importers FOB strikes the perfect balance: the supplier manages China-side logistics (where language and local rules can be tricky), but you control the main freight. This means transparent pricing and no surprise markups from the supplier’s forwarder.
If you have a reliable freight partner, FOB often delivers the best cost predictability for growing businesses.
What Is EXW (Ex Works)?
EXW is the “minimal responsibility” option for the supplier—everything starts and ends at their factory door.
Supplier’s Responsibilities:
- Prepare and pack the goods
- Make them available for pickup at their premises
Your Responsibilities as Buyer:
- Factory pickup/trucking
- Export customs declaration in China
- Origin port handling
- International freight
- Import clearance, duties, and taxes
- Final delivery
When EXW Makes Sense EXW quotes often look cheapest upfront (low product price, no added services). It’s ideal if:
- You have strong control over China logistics
- You’re highly experienced with export clearance
- Your supplier refuses FOB
The Hidden Catch with EXW In reality, EXW frequently ends up more expensive than FOB. Once you factor in factory pickup, export fees, and port charges, the “savings” disappear. Many first-time importers learn this the hard way after their initial shipment.
What Is DDP (Delivered Duty Paid)?
DDP is the “hands-off” premium option—the supplier or their forwarder handles the entire journey, including duties and final delivery.
Supplier/Forwarder’s Responsibilities:
- Factory pickup
- Export clearance
- Main freight (sea, air, or rail)
- Import customs clearance
- Payment of duties, taxes, and VAT/GST
- Delivery to your door or Amazon FBA warehouse
Your Responsibilities as Buyer:
- Provide accurate delivery details
- Ensure the goods are importable under DDP rules
Why DDP Is So Popular (Especially for Amazon Sellers) DDP offers:
- One clear landed cost (no surprises)
- Zero customs paperwork on your end
- Faster, hassle-free deliveries
It’s a game-changer for small businesses or high-volume e-commerce sellers who want to focus on sales, not logistics.
Important Caution with DDP If a DDP quote seems suspiciously cheap, proceed with caution. Some providers cut corners on customs declaration to lower costs, risking delays, extra fees, or even seizure.
Always ask: “How will this be declared at destination customs?”
Quick Comparison Table: DDP vs FOB vs EXW
| Step in Supply Chain | EXW (Ex-Works) | FOB (Free On Board) | DDP (Delivered Duty Paid) |
| 1. Packing Goods | 🔶 Seller | 🔶 Seller | 🔶 Seller |
| 2. Inland Trucking (CN) | 🔵 Buyer (You) | 🔶 Seller | 🔶 Seller |
| 3. Export Customs (CN) | 🔵 Buyer (You) | 🔶 Seller | 🔶 Seller |
| 4. Origin Charges (OTHC) | 🔵 Buyer (You) | 🔶 Seller | 🔶 Seller |
| 5. Ocean/Air Freight | 🔵 Buyer (You) | 🔵 Buyer (You) | 🔶 Seller |
| 6. Dest. Charges (DTHC) | 🔵 Buyer (You) | 🔵 Buyer (You) | 🔶 Seller |
| 7. Import Duties & Tax | 🔵 Buyer (You) | 🔵 Buyer (You) | 🔶 Seller ⚠️ (Risk Area) |
| 8. Final Delivery | 🔵 Buyer (You) | 🔵 Buyer (You) | 🔶 Seller |
| STRATEGY VERDICT | Total Control (Best for consolidation) | Balanced Control (Best for scalability) | Zero Control (Hidden costs & Fraud risk) |
Real-World Insight: Many assume FOB is cheapest, but for most China imports, EXW ends up the most cost-effective long-term.
Common Mistakes & How to Avoid Them
Common Mistakes #1 Departure port charges are argued under FOB terms
Departure port charges are argued is one of the most classic headaches: my client agreed on FOB terms with their supplier, but when we(freight forwarder) booked the shipping and sent the local charges bill, the supplier flat-out refused to pay. They claimed they only cover “export fees” and told us to bill the buyer. After a ton of back-and-forth, my client ended up eating half the costs just to keep things moving.
How to Avoid? Spell it out upfront with your supplier. Most factories know the rules inside out, but some don’t (or pretend not to). Get written confirmation on exactly what costs they cover under the term. I’ve seen too many “FOB” deals turn into fights over terminal handling charges or trucking.
Common Mistakes #2 Neglect the FOB actual departure port
A lot of importers often neglect the actual loading port. Most importers think FOB (Free on Board) is the solution, but it often leads to “Port Drama.”
The Local Port Dispute: We often see suppliers quote FOB Jiangmen instead of FOB Shenzhen. Since Jiangmen is a feeder port, your cargo must be ferried to a major hub like Shenzhen for international loading. When unexpected ferry delays or transshipment costs arise, suppliers refuse to pay because they “delivered” to Jiangmen. This results in endless arguments and hidden fees.
But we are not stating that FOB jiangmen is not right, it’s actually a good solution and favorable way than truck to shenzhen, but during the actual work, there is lots of details to check and confirm, in conclusion, no trade term is pure bad or good, you have to be very clear and it has to be based on your actual shipping plan.
How to Avoid? Make sure the loading port is the main ports of China if you choose FOB, must be careful FOB shenzhen , FOB shanghai, not other small ports, if you are not sure, you can consult your freight forwarder or just choose the EXW term.
Frequently Asked Questions
1. Is DDP legal in the USA, Canada, EU, or Middle East? Yes—when done properly with full compliance. Reliable forwarders use legitimate declaration methods.
2. Is EXW better than FOB for most importers? Absolutely for beginners and mid-sized businesses. EXW avoids unpredictable origin charges and simplifies export clearance and give you more control of your shipment.
3. Can I use DDP for Amazon FBA shipments? Yes! DDP is one of the most convenient options for direct-to-FBA delivery.
4. Does DDP include all duties and taxes? Yes—customs clearance, duties, VAT/GST (where applicable), and final delivery are all covered.
How to Choose the Right Term for Your China Imports
Simple decision framework:
- Want zero hassle and clear costs? Go DDP.
- Need balance and good savings? Choose FOB.
- Prefer full control and have experience? Try EXW.
For first-time or small-volume importers, DDP or EXW usually provides the smoothest experience.
Final Thoughts
The right shipping term isn’t just technical—it’s about protecting your margins and peace of mind when importing from China. Understanding DDP, FOB, and EXW helps you avoid hidden fees, delays, and compliance risks.
At Kisun Shipping, we specialize in transparent, compliant solutions tailored for SMEs shipping from China to the USA, Canada, Europe, Middle East, and Southeast Asia.
Ready for a Custom Quote? Contact us for:
- Side-by-side DDP vs FOB vs EXW cost comparison
- Accurate door-to-door timelines
- Optimized routing for your products
- Risk-free customs planning
Get in touch today for a free consultation and transparent quotation. Let’s make your next import smoother and more profitable.
Want to know more about shipping from China? Contact us now!