FOB vs EXW vs CIF: Choosing the Right Trade Term for Furniture

Two factories can quote you a dining chair at almost the same number and still end up costing you very different amounts. The difference is usually the trade term — EXW, FOB or CIF — written at the bottom of the quotation. For European furniture importers, the trade term decides who books the vessel, who pays for inland haulage, who clears export customs, and who carries the risk while your chairs are on the road or on the water.

Many first-time buyers compare only the unit price and later discover that "cheap" EXW terms pushed thousands of euros of freight, documentation and risk onto their own team. Understanding FOB vs EXW vs CIF is therefore one of the highest-leverage decisions in your sourcing project.

At Olleo Furniture, an upholstered seating factory in Anji, Zhejiang, we quote FOB Ningbo or FOB Shanghai as our standard term, and we also support EXW, CFR and CIF. This guide explains what each term covers and how to choose the right one for your next order.

EXW (Ex Works): Maximum Control, Maximum Work

Under EXW, the seller's job ends at the factory gate. You collect the goods — usually through your appointed freight forwarder — and everything after that point belongs to you:

• You arrange inland transport from the factory to the port.

• You handle Chinese export customs clearance and documentation.

• You book the vessel or aircraft and pay the international freight.

• You carry the risk from the moment the goods leave our workshop.

EXW works well when you already have a trusted forwarder with an office in China, or when you are consolidating goods from several factories into one container. Because the factory price excludes local charges, EXW looks cheapest on paper — but the local leg in China can quietly add real cost. If your forwarder charges premium rates for pick-up, export declaration and port handling, a "cheaper" EXW quote can end up more expensive than a competitor's FOB offer.

FOB (Free On Board): The Balanced Default

Under FOB, the factory delivers the goods cleared for export onto the vessel at the named port — for us, FOB Ningbo or FOB Shanghai. The factory pays and handles:

• Inland transport from the Anji factory to the port.

• Export customs declaration and all export documents.

• Terminal handling charges at the Chinese port.

From the moment the container is loaded on board, risk and cost transfer to you. You still book the ocean freight and arrange insurance and import clearance in Europe — but the trickiest local leg is our responsibility, not yours.

For most European buyers, FOB is the sensible middle ground. You keep control of your freight forwarder and your ocean rates, while relying on the factory's local knowledge and established trucking relationships. A factory that regularly ships FOB also signals a healthy export operation that knows the port routines inside out.

CIF (Cost, Insurance and Freight): Factory-Arranged Shipping

Under CIF, the factory goes one step further: we arrange and pay for ocean freight to your named European port and include marine insurance. The term is often chosen by smaller importers, wholesalers testing a new product line, or buyers who simply want a single landed cost figure without negotiating with carriers.

CIF has trade-offs you should weigh:

• The factory may not have your freight-forwarding leverage, so ocean freight inside a CIF quote can be above spot rates.

• Under CIF, the seller typically arranges only minimal insurance coverage — many buyers supplement it with their own policy.

• Risk still transfers to the buyer once goods are on board, even though the seller pays the freight — a point that confuses many new importers.

In short, CIF buys convenience, not protection — if you are comfortable managing freight, FOB usually gives the better total cost.

Quick comparison — who does what under each term:

How to Choose the Right Term for Your Order

There is no universally "best" Incoterm — the right choice depends on your experience, your forwarder network and your order profile. Use these questions as a quick self-check:

1. Do you have a forwarder with China operations? If yes, FOB lets you plug their rates into your landed-cost model while the factory handles the local leg.

2. Are you consolidating multiple suppliers into one container? EXW from each factory, with your forwarder coordinating collection, can be efficient — if their China-side charges are competitive.

3. Is this your first order or a small trial order? CIF removes logistics friction while you validate a new line. Once volumes grow, switch to FOB and capture the freight savings yourself.

4. Do you want a clean landed cost for budgeting? CIF gives you one number covering goods, freight and insurance; just verify what insurance level is actually included.

Whichever term you choose, always compare quotes on the same basis. A CIF price and an FOB price are not comparable until you add ocean freight, insurance and destination charges to the FOB number — and remember that under all three terms, EU import duty and VAT are always the buyer's responsibility.

What Olleo Furniture Offers on Every Term

Trade terms only work well when the operation behind them is disciplined. Our commitments apply whether you buy EXW, FOB or CIF:

• MOQ 100 pieces per model, with mixed colors allowed within the same model — small enough to test a design, large enough to keep unit economics healthy.

• 35-day lead time from order confirmation, so your shipment plans stay predictable.

• EN 12520 certified seating for home use and EUDR-registered sourcing with certified timber, which simplifies both your compliance file and your customs paperwork.

• Full OEM/ODM support and a reply to every inquiry within 24 hours.

Frequently Asked Questions

Which term is cheapest for a European furniture importer?
Usually FOB. You pay the factory for delivery to the port and use your own forwarder's ocean rates, which are often lower than freight built into a CIF quote. EXW can be cheaper only if your forwarder's China-side charges are genuinely low.

Does CIF mean the factory is responsible if the goods are damaged at sea?
No. Under CIF, cost and freight are the seller's responsibility, but risk transfers to the buyer once the goods are loaded on board at the Chinese port. Insurance covers the transit loss — check the coverage level included in the quote.

Can Olleo quote multiple trade terms for the same order?
Yes. We routinely quote EXW, FOB Ningbo/Shanghai, CFR and CIF side by side so buyers can compare total landed cost before deciding.

Ready to compare real numbers? Send us your target port and preferred term for comparable quotes. Browse our upholstered dining chairs and sofa collection to shortlist models, then contact our export team — we will reply within 24 hours with an EXW/FOB/CIF comparison for your specification. If compliance documentation is on your checklist, our EN 12520 buyer guide is a good place to start.