Difference Between EXW vs FOB

Difference Between EXW & FOB

FOB or EXW? For many new importers incoterms can be overwhelming and confusing, as there are many things to be aware of: How does it work, who can I trust, what are incoterms, and which is the best solution for me? With this article we aim to introduce you to the most common incoterms, FOB and EXW, which are essential to be familiar with when you are importing from overseas. Knowing your incoterms can help you avoid unexpected charges.

Before you choose between exw vs fob, you will first need to understand the difference between the EXW vs FOB to fully understand the appropriate usage of these terms and what they encompass. 

EXW & FOB these two terms are related to Freight service. Both Exw vs Fob are Incoterms to refer to international shipments. It is a key factor for these clients who needs this service for better and reliable transportation of goods.

EXW vs FOB

FOB Meaning

Free on Board (FOB) is FOB is a shipping term that stands for “free on board.” A shipment term that defines the point in the supply chain when a buyer or seller becomes liable for the goods being shipped.

In FOB, the responsibility of loading the package on your desired ship falls on the seller, and only after that does the responsibility of goods passes on to you.

EXW Meaning

Incoterm EXW meaning the shipping arrangement in which a seller makes a product available at a specific location, and the buyer has to pick up by themselves.

In EXW, the arrangement means that the responsibility of collecting, loading, and transporting falls on you. The seller only has to let you the pick-up location.  

FOB / EXW  Conclusion

To sum up Exw vs Fob, the freight costs under EXW terms might be high, but you get a very clear idea of all of your costs and control most of them (except for the customs inspections).

The difference between fob and exw is the shipment location arrangement. Usually, goods shipped by EXW will generally be cheaper FOB, as Free on Board will make the supplier cover shipping, handling and customs clearance costs in the country of origin. However, EXW terms are generally riskier because the supplier is only responsible for the goods until they reach their destination.

If you have any questions about shipping terms, you can also contact us at any time.

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