The Incoterm (International Commercial Terms) sets out the conditions agreed upon between the exporter and the importer regarding the delivery of goods, transaction costs, and responsibilities of each involved party. The most commonly used Incoterms when importing from China are CIF and FOB, two modalities of managing maritime transportation that have significant differences in terms of costs, timeframes, cargo security, and logistics chain efficiency, among other aspects. It is advisable to always choose the Incoterm that offers greater control over times and costs to avoid delays, unexpected expenses, or damage to the goods. Beginner importers or those with little experience often prefer the CIF modality for convenience. However, when dealing with China, the FOB Incoterm is generally safer and more competitive. In any case, it is advisable to delegate the negotiation of Incoterms to an experienced management company to secure the best conditions.
Importing with CIF Incoterm
With the CIF Incoterm modality, the reception of goods at the destination is usually carried out by a customs agent. The buyer (importer) assumes payment for expenses at the destination, customs clearance, taxes, and transportation to their facilities. Although this modality is more convenient and economical for the importer, it is important to remember that control over freight management is lost, and the agent invoices expenses at the destination, which may include their own concepts or surcharges.
Importing with FOB Incoterm
The responsibilities of importing under the FOB Incoterm lie with the importer, from contracting to freight management. It might seem like a more complex process, but having absolute control over the shipment makes it much safer. Additionally, this modality allows the importer to negotiate prices and insurance, as well as obtain tax benefits, thereby reducing costs. In summary, importers have two Incoterm modalities at their disposal, CIF and FOB. Our experience in managing imports from China allows us to advise our clients on the most advantageous option in each case. If you wish to import from China, feel free to request advice from our professionals regarding the most suitable Incoterm. Our company specializes in locating verified suppliers, as well as in all types of import-related management.
