Incoterms Cost & Risk Simulator

About This Tool

Incoterms (International Commercial Terms) are standardized trade terms published by the International Chamber of Commerce (ICC). The current version is Incoterms 2020. These 11 three-letter codes (EXW, FOB, CIF, etc.) define the allocation of costs and risks between seller and buyer, and are a required element in international quotations, contracts, and invoices.

Quick Guide to Choosing an Incoterm

• Minimize seller's responsibility: EXW (goods available at the seller's premises)
• Seller handles export clearance: FCA / FOB / FAS
• Seller pays main carriage: CPT / CFR / CIP / CIF
• Seller bears transport & risk to destination: DAP / DPU
• Seller covers everything including import duties: DDP

Sea-Only vs. All Modes

• Sea and Inland Waterway Only (FAS / FOB / CFR / CIF): Designed for vessel-based shipping. For containerized cargo, FCA / CPT / CIP are generally more appropriate
• Any Mode (EXW / FCA / CPT / CIP / DAP / DPU / DDP): Suitable for sea, air, road, rail, and multimodal transport

Common Choices

• Manufacturing exports: FOB (buyer arranges and pays for ocean freight) is traditional
• E-commerce / small parcels: DDP (seller handles everything, buyer simply receives) is growing
• Heavy machinery / plant equipment: CIF (seller pays freight and insurance to destination port)

Note: This tool displays the standard cost allocation per Incoterms 2020. Actual transactions are governed by the specific terms in each contract. Consult the ICC or a trade specialist for details.