A First-Time Importer's Guide to Shipping from China: Incoterms, Documents, and Costs

Start With Incoterms, Because They Decide Who Pays for What

Incoterms (International Commercial Terms) define exactly where the seller’s responsibility ends and the buyer’s begins. For a first-time importer, the terms you’ll run into most often are:

• EXW (Ex Works): the factory hands goods over at its own door. You (or your freight agent) handle everything from there — domestic trucking, export customs, international freight, import customs, final delivery. Cheapest quoted price, most responsibility on you.
• FOB (Free On Board): the seller handles getting goods to the origin port and loaded onto the vessel. You take over from there — international freight, import customs, final delivery.
• CIF (Cost, Insurance, Freight): the seller pays for international freight and minimum cargo insurance up to the destination port, though the risk passes to you once the goods are loaded on the vessel at origin. You handle import customs and final delivery.
• DDP (Delivered Duty Paid): the seller handles everything, including import duties, all the way to your door. Highest quoted price, least work for you. (We offer this as a DDP door-to-door shipping service.)

Side by side, under Incoterms 2020:

Incoterm	Seller covers	You handle	Transport mode
EXW	Goods ready at the factory door	Trucking, export customs, international freight, import customs, delivery	Any
FOB	Delivery to origin port, loaded on the vessel	International freight, import customs, delivery	Sea and inland waterway only
CIF	Freight and minimum insurance to destination port (risk passes at loading)	Import customs, delivery	Sea and inland waterway only
DDP	Everything to your door, including import duties	Unloading at your door	Any

A quoted product price under EXW terms is not directly comparable to a DDP quote from a different supplier — always confirm which Incoterm a price reflects before comparing two quotes.

Documents You’ll Actually Need

• Commercial invoice — states the transaction value, used for customs valuation.
• Packing list — itemizes what’s in each carton, used by customs and by the freight forwarder for cargo handling.
• Bill of lading (sea) or air waybill (air) — the shipping document and proof of the contract of carriage.
• Certificate of origin — required for some destination countries or to claim preferential tariff treatment under trade agreements.
• Product-specific certifications — varies heavily by category (electronics, children’s products, cosmetics, and food-adjacent products often have additional requirements specific to the destination country).

Where Your Freight Cost Actually Comes From

A landed cost estimate that only accounts for “shipping” usually misses several real cost components:

1. Domestic trucking from factory to port or airport
2. Export customs clearance and documentation fees
3. International freight itself (the line-haul cost)
4. Import duties and taxes at destination (rate depends on product classification and destination country)
5. Import customs clearance and destination handling fees
6. Last-mile delivery to your final address or warehouse

Sellers who only budget for the line-haul freight quote are often surprised by the accumulated cost of the other five items.

The Single Most Common First-Time Importer Mistake

Treating the cheapest quoted price as the actual cost. An EXW quote that looks dramatically cheaper than a DDP quote from another supplier usually just means more of the actual cost and coordination work has been pushed onto you — not that the total landed cost will actually be lower.

Simplifying This for Your First Shipment

If this is your first time importing, working with one vendor that handles packing, documentation, and freight booking together removes most of the coordination risk — you’re not chasing down which of three separate vendors dropped the ball when something goes wrong. If you haven’t picked a supplier yet, our product sourcing service can start one step earlier. Tell us about your first shipment and we’ll walk you through exactly what it needs.