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Writer's pictureEsmaeel Habibi

Ex Works vs Free On Board

Updated: Jan 25, 2021




Ex Works EXW is short for ‘Ex Works’ and refers to a door-to-door shipment. If you trade on EXW terms, you are responsible for the entire transport process, meaning it is your responsibility to arrange transportation from your supplier’s door to your address . Therefore, when you select a forwarder to handle the transport for you, make sure that the transport solution includes customs clearance in both the origin country and in the destination port Free on Board FOB is an abbreviation of ‘Free On Board’, and is a port-to-door shipment. This means that when you trade on FOB terms, your supplier is responsible for all local charges, which include transport to the port, handling of the cargo, and customs clearance at origin. This also means that you have to find a freight forwarder to take over your shipment and carry out the freight when your goods board the ship   As soon as your goods are aboard the ship or airplane, the transport responsibility and cost shifts from your supplier to you as importer EXW vs FOB the difference between the two is clear: Using EXW, you are responsible for all costs associated with your transport to the destination port, whereas, with an FOB agreement, you are only accountable for the costs that come after your goods have boarded the ship or aircraft

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