1. EXW: what is it and what are its pros and cons?
2. Plus more Incoterms explained.
What is the advantage for the shipper in EXW?
When goods are sold on an EXW basis, the seller is not responsible for any costs or risks associated with getting the goods to the buyer. The buyer is responsible for arranging and paying for transportation, import/export clearance, and insurance. This can be advantageous for the seller because it allows them to sell the goods at a lower price, since they are not including the cost of shipping in the sale price. It can also be advantageous for the buyer because they can choose their own shipping method and carrier, which gives them more control over the cost and timing of delivery. How is EXW calculated? EXW stands for Ex Works. It is a pricing term used in international trade that indicates that the price of goods does not include the cost of transportation to the buyer's location. The buyer is responsible for arranging and paying for transportation from the seller's location.
What is Incoterm code?
Incoterm code is an international trade term that defines the responsibilities of buyers and sellers for the delivery of goods. The code is used to determine which party is responsible for paying freight charges, insurance, and other costs associated with the transport of goods. It also clarifies which party is responsible for the risk of loss or damage to the goods during transport.
Which is better ex works or FOB? There is no definitive answer to this question as it depends on a number of factors, including the nature of the goods being shipped, the relative costs of transportation, and the terms of the sales contract.
In general, "ex works" (also known as "EXW") is a more advantageous terms of sale for the seller, as it requires the buyer to bear the costs and risks of transportation. "FOB" (or "free on board"), on the other hand, is more advantageous for the buyer, as the seller is responsible for the costs and risks of transportation up to the point of delivery.
It is important to note that the terms of sale must be carefully negotiated between the buyer and seller, and that any ambiguities should be avoided. What are the pros and cons of an ex works agreement? An ex works agreement is a contract between a buyer and a seller that stipulates that the seller will make the goods available at their premises for the buyer to collect. The buyer is responsible for arranging and paying for transportation of the goods. The advantage of this type of agreement is that it is usually the cheapest option for the buyer as the seller is not responsible for any additional costs. The disadvantage is that the buyer has to manage the logistics of collection and transport, which can be complex and time-consuming.