DDP, FOB, CIF: Which Shipping Term Should You Use When Importing from China?

When you agree a purchase with a Chinese supplier, one of the most important decisions you'll make isn't about the product  it's about the shipping terms. The Incoterm you choose determines who pays for what, who handles customs, and who bears the risk if something goes wrong in transit.

Here's what the three most common terms actually mean.

FOB  Free on Board

Under FOB, the supplier's responsibility ends when your goods are loaded onto the ship at the Chinese port. Everything from that moment  freight, insurance, import customs clearance, duty payment, and delivery to your warehouse  falls on you.

FOB gives experienced importers maximum control over their logistics costs. But it requires you to have a freight forwarder and customs broker already in place in your country, and the knowledge to use them correctly.

CIF  Cost, Insurance and Freight

CIF means the supplier pays for freight and insurance to your destination port. But once the ship docks, you take over: import clearance, duty payment, and inland transport are your responsibility.

CIF reduces your exposure compared to FOB, but still leaves you handling the most complex part of the import customs — on your side.

DDP  Delivered Duty Paid

DDP Shipping from China is the most buyer-friendly term available. Under DDP, the seller or their logistics partner handles the entire journey: export clearance from China, international freight, import customs clearance, all duties and taxes, and final-mile delivery to your address.

You pay one all-inclusive price. The goods arrive at your door. Nothing else to pay.

Who Should Choose DDP?

• First-time importers unfamiliar with customs procedures

• Businesses importing regulated goods like solar panels, batteries, or EV equipment that attract specific duty classifications

• Amazon FBA sellers — Amazon requires DDP for all inbound inventory

• Any buyer who wants a fixed landed cost for accurate financial planning

The One Thing to Watch Out For

Some suppliers offer 'DDP' pricing but actually clear goods through informal channels — undervaluing shipments to avoid duties. This shifts legal liability onto you as the importer. Always use a licensed, legally registered sourcing company with a verifiable import/export licence.