Three letters in your contract decide who pays, who insures, and who carries the risk. Get them wrong and it costs you.
Incoterms are the three-letter rules that split cost and risk between buyer and seller. Most Bangladesh garment exports move on FOB, but that is not always the smartest choice.
The terms you will meet most
- EXW: buyer does almost everything from your factory gate.
- FOB: you deliver on board at Chattogram, risk passes there.
- CFR and CIF: you pay ocean freight to destination; with CIF you also insure.
- DAP and DDP: you deliver to the buyer's door, with DDP paying import duty too.
The trap in the C terms
Under CFR and CIF, you pay the freight but risk passes to the buyer once goods are on board. The buyer carries the sea risk on a journey you booked.
Try our free visualizer
Our Incoterms visualizer lights up who pays each leg and where risk transfers, for all eleven terms. It is the fastest way to see what a term really costs you.
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