Incoterms are standard trade terms, published by the International Chamber of Commerce, that say who arranges and pays for each part of the journey from factory to buyer and at which point the risk of loss passes. For fitness accessory imports, the terms you will see most are EXW, FCA, FOB, CIF and DDP.
This guide is for brands, online sellers and distributors placing their first international orders. It explains what each common term covers, how they compare, what changed in Incoterms 2020 and what Amazon sellers need to know before choosing a term for stock heading to a fulfillment center.
What Do Incoterms Cover and What Do They Not Cover?
An Incoterm answers three practical questions: where the seller delivers the goods, who pays for which transport and costs, and when the risk of loss or damage moves from seller to buyer.
Incoterms do not decide the price, the payment terms, when ownership of the goods passes or what happens if the goods are faulty. Those belong in your purchase order or sales contract. A term written alone also needs a named place and the edition, for example FOB followed by the loading port and the words Incoterms 2020, so there is no doubt about where delivery happens.
Which Incoterms Do Fitness Accessory Buyers Use Most?
The current edition, Incoterms 2020, has eleven rules. Seven work for any mode of transport and four are only for sea and inland waterway shipments. In practice, most accessory orders use one of five.
| Term | Seller Delivers | Risk Passes to Buyer | Typical Use |
|---|---|---|---|
| EXW, Ex Works | Goods ready at the seller’s premises | When goods are made available at the premises | Buyers with their own forwarder at origin |
| FCA, Free Carrier | Goods handed to the buyer’s carrier at a named place | On handover to that carrier | Containers and air cargo with the buyer’s forwarder |
| FOB, Free On Board | Goods loaded on the vessel at the named port | Once goods are on board | Sea freight where the buyer books the ship |
| CIF, Cost Insurance and Freight | Goods on board, with sea freight and insurance paid to the destination port | Once goods are on board at origin | Sea freight where the seller books the ship |
| DDP, Delivered Duty Paid | Goods delivered at the named destination, import duties paid | At the destination | Buyers who want one delivered cost |
Notice that under CIF the seller pays the freight to your port, yet the risk still passes at the origin port. If cartons are damaged at sea, you claim on the insurance rather than from the seller.
Who Pays for What Under Each Term?
The responsibility table below shows the main cost points for an export from the factory to your warehouse.
| Cost Point | EXW | FCA | FOB | CIF | DDP |
|---|---|---|---|---|---|
| Export packing | Seller | Seller | Seller | Seller | Seller |
| Loading at the factory | Buyer | Seller | Seller | Seller | Seller |
| Export customs clearance | Buyer | Seller | Seller | Seller | Seller |
| Main sea or air freight | Buyer | Buyer | Buyer | Seller | Seller |
| Cargo insurance | Buyer’s choice | Buyer’s choice | Buyer’s choice | Seller, minimum cover | Seller’s choice |
| Import clearance and duties | Buyer | Buyer | Buyer | Buyer | Seller |
| Delivery to your warehouse | Buyer | Buyer | Buyer | Buyer | Seller |
EXW looks simple but places export clearance on the buyer, which can be hard to arrange in another country. Many buyers who want EXW-style control actually use FCA instead.
What Changed in Incoterms 2020?
Three changes matter most for accessory buyers moving from older contracts.
CIP Insurance Raised
Under CIP, the seller must now provide broad cover under Institute Cargo Clauses (A). CIF still requires only the minimum Clauses (C) unless you agree more.
FCA With an On-Board Bill
Buyer and seller can agree that the buyer’s carrier issues an on-board bill of lading to the seller, which helps when payment is by letter of credit.
DAT Became DPU
Delivered at Terminal was renamed Delivered at Place Unloaded, and the place no longer has to be a terminal.
The International Chamber of Commerce notes that FCA often fits containerized goods better than FOB, because the seller usually hands containers to the carrier at a terminal before they are loaded on board.
What Should Amazon Sellers Know Before Choosing a Term?
Amazon states in its seller help pages that it will not act as importer of record for FBA inventory shipments. Someone else, usually the seller or a customs broker or forwarder acting for the seller, must be named as the importer.
Amazon also requires inbound international shipments to arrive with all duties, taxes and freight already paid, and refuses shipments that arrive with charges to collect. In practice, most sellers either import to their own address or a forwarder’s warehouse first, or use a forwarder that clears customs as importer and delivers to the fulfillment center with everything paid.
Rules change, so check the current Amazon import guidance for your marketplace and confirm your importer of record with your customs broker before the goods leave the factory.
How Do You Choose the Right Term for Your Order?
- Choose FCA or FOB when you have a forwarder you trust and want control of freight cost and timing
- Choose CIF or CIP when you prefer the seller to book the main transport
- Choose DDP only when the seller can legally act as importer in your country or names a partner who can
- Avoid EXW unless your forwarder can handle export clearance at origin
- Always write the named place and the edition, such as Incoterms 2020
- Agree insurance cover in writing, especially under CIF
The term also shapes how you compare quotes. A DDP price and an FOB price are not comparable until you add freight, insurance, duties and delivery to the FOB figure.
How Do Incoterms Fit Into an Order With Oath and Oak?
At Oath and Oak, orders ship by air or sea, and the trade term is agreed in your written quotation along with packing, carton marks and documents. Tell us your delivery country, whether you use a forwarder and whether goods go to your warehouse or a fulfillment center, and we suggest the term that fits.
Carton labels, packing lists and invoices are prepared to match the agreed term, so your forwarder or broker has what they need at each handover. Our wholesale page explains how volume orders and restocks are planned.
Which Incoterm Mistakes Cause Problems?
No Named Place
FOB with no port named leaves both sides guessing about where delivery and risk transfer happen.
Assuming CIF Means Full Cover
CIF requires only minimum insurance by default, which may not cover all damage to finished goods.
Choosing DDP Without an Importer
A seller abroad cannot always act as importer, and shipments without one can be held or refused.
Comparing Quotes on Different Terms
An FOB quote looks cheaper than a DDP quote until freight, duties and delivery are added.
Treating Incoterms as the Whole Contract
Payment, ownership and quality claims still need their own clauses in the order terms.
What Else Do Buyers Ask About Incoterms?
Which term is most common for sea freight orders?
FOB is widely used, with the buyer’s forwarder booking the vessel. FCA is often a better technical fit for containers, and more buyers are moving to it.
Are Incoterms legally binding?
They apply when the contract refers to them. Writing the term, the named place and the edition in your purchase order makes them part of the agreement.
Do Incoterms set when I pay?
No. Payment timing and method, such as a deposit and balance, are agreed separately in the order terms or quotation.
Which term suits air shipments of samples?
Express courier samples often move on a delivered basis set by the courier, while larger air cargo commonly uses FCA or a delivered term agreed with the forwarder.
Where can I read the official rules?
The International Chamber of Commerce publishes the Incoterms 2020 rules and guidance. Your freight forwarder or customs broker can also explain how each term works for your route.
