Incoterms 2020 for FMCG buyers: EXW, FOB, CIF and DAP compared
Every wholesale offer we issue names an Incoterm. It is the single line on the offer that decides how much the goods will actually cost you, and it is the line buyers most often skim past. Two quotes that look €400 apart on a pallet can be identical once you account for who is paying the freight — or €1,200 apart in the other direction.
This guide covers the five terms that account for almost all FMCG movements out of Poland. It is written from the loading side, which is where the arguments happen.
What an Incoterm actually settles
An Incoterm settles three things and nothing else:
- Cost. Which of us pays for carriage, loading, export clearance, insurance and import duties.
- Risk. The exact point at which responsibility for loss or damage moves from seller to buyer.
- Obligation. Who has to arrange each stage, which is not always the same as who pays for it.
It does not settle when title passes, it does not settle payment terms, and it is not a contract of carriage. Those are separate and must be agreed separately.
The rule that saves the most money: risk and cost do not always transfer at the same point. Under CIF they famously do not — you carry the risk from the moment the goods are loaded at the port of shipment, even though we are paying for the freight to your port. This surprises first-time buyers more than any other detail in the system.
EXW — Ex Works, Warszawa
You take the goods at our loading point. We make them available, palletised and wrapped; you arrange and pay for everything from that moment, including loading the truck, export clearance and all carriage.
When it makes sense: you already have a forwarder with a Polish presence and a rate better than ours, or you are consolidating with goods from several Polish suppliers into one groupage load.
The catch: EXW puts export clearance on you, and a non-EU buyer cannot usually file a Polish export declaration without an EU-established representative. In practice most non-EU buyers who ask for EXW actually want FCA. If you are outside the EU and unsure, assume FCA.
FCA — Free Carrier
We deliver the goods, cleared for export, to a carrier you nominate. If the named place is our premises, we load the truck; if it is elsewhere, we deliver but the unloading is yours.
When it makes sense: almost any time you would have reached for EXW. It gives you the same control over freight, but export clearance stays with us, where the paperwork and the EORI number already are.
The catch: "FCA" without a named place is meaningless. Always write FCA Warszawa (seller's premises), Incoterms 2020 or the equivalent for your chosen point.
FOB — Free On Board, Gdańsk or Gdynia
We deliver the goods on board the vessel you have nominated at the named port. Risk transfers when the goods are on board. Everything from that point — sea freight, insurance, destination handling, import duty — is yours.
When it makes sense: containerised shipments leaving the EU where you have a shipping line contract. Most experienced importers outside Europe buy FOB, because ocean freight is where the biggest savings sit and they can negotiate it better than we can.
The catch: FOB is a maritime term. It should not be used for road groupage into Germany, and it should not be used for containers handed over at an inland depot rather than at the ship's rail — that is FCA. Using FOB for a truck load is one of the most common errors we see on incoming enquiries.
CIF — Cost, Insurance and Freight
We pay for carriage to your named destination port and take out minimum-cover marine insurance. Risk still transfers when the goods are loaded on board at the origin port.
When it makes sense: a first order into a new market, or where you have no freight relationships yet and want one number to work from.
The catch, twice over. First, the insurance required under CIF is minimum cover — Institute Cargo Clauses (C). For high-value FMCG such as infant formula or branded personal care, that cover is thin. Ask for Clauses (A) explicitly and expect it to be priced in. Second, CIF ends at the destination port. Terminal handling charges, customs clearance, duty, VAT and onward carriage are still yours, and buyers who assume CIF means "delivered to my warehouse" get an unpleasant invoice from the port.
DAP — Delivered At Place
We deliver to your named address, ready for unloading. We carry cost and risk the whole way. Import clearance, duty and VAT remain yours.
When it makes sense: intra-EU road deliveries, where there is no customs frontier and DAP genuinely does mean the truck arrives at your door. This is our most common term for buyers in Germany, Czechia, Slovakia, the Baltics and Scandinavia.
The catch: for non-EU destinations DAP leaves you with clearance and duty at the far end. If you want the whole thing including duty, that is DDP — and we quote DDP only where we have a reliable clearance partner in the destination country, because taking on someone else's import duty exposure without one is how suppliers lose money.
A worked example
One EUR pallet of canned soft drinks, Warszawa to Hamburg, road. The goods cost the same under every term; only the add-ons move.
| Term | We pay | You pay | Risk transfers |
|---|---|---|---|
| EXW Warszawa | Picking, palletising | Loading, export clearance, all carriage | At our door, before loading |
| FCA Warszawa | Picking, palletising, loading, export clearance | All carriage | On loading to your carrier |
| DAP Hamburg | Everything to your address | Unloading; duty and VAT if non-EU | On arrival, before unloading |
The figures behind each column change weekly with fuel and capacity, which is why we quote them per shipment rather than publishing a table. What does not change is the split of responsibility above.
How to write it on your enquiry
Give us the term, the named place, and the year of the rules. All three:
- FCA Warszawa (seller's premises), Incoterms 2020
- FOB Gdynia, Incoterms 2020
- DAP Hamburg, Kirchenpauerstraße 1, Incoterms 2020
If you genuinely do not know which suits your route, say so. Put "not sure — advise me" on the quote form and we will price the two terms that make the most sense for your destination, so you can compare like with like.