I know you’re probably looking for the best Incoterm that will help you reduce liability and cost.
Well, the reality is:
Every Incoterm has advantages and disadvantages, depending on whether you’re the seller or buyer.
Also, the circumstances you’re doing the business also play a vital role.
Today, I want to talk about EXW Incoterm.
I will explain what it is and how it works.
Furthermore, I’ll walk you through its advantages and disadvantages.
And, later, you’re going to learn about buyers’ and sellers’ obligations under EXW incoterm.
If you’re looking for a reliable freight forwarder to help your shipping from China, BRF ロジスティクス can be your better choice.
What Is EXW (Ex Works)?
EXW, an acronym for Ex Works. It implies that the delivery of goods is regarded as complete once the seller delivers them to the buyer’s location.
The buyer’s location can be his/her warehouse or factory.
With EXW terms, the seller is not responsible for loading the goods onto the transporting vessel or handling the export customs clearance.
This Incoterms gives the supplier the least responsibilities.
You should avoid it in case the buyer is not in a position to directly or indirectly manage the process of exporting goods.
The EXW shipping term is flexible, you can apply it, despite the mode of transport.
Nevertheless, if both transaction parties choose to share the risks and responsibilities associated with loading the product during shipment, the agreement must be plainly declared.
EXW shipping terms are more suitable for domestic transport of goods.
Where the buyer can employ the services of, their logistic partners or freight forwarding agent to manage the transport.
This way, it will be cheaper and efficient, unlike when the seller manages the whole delivery process.
Key Responsibilities Under EXW
| 責任 | Seller (China) | Buyer (Importer) |
|---|---|---|
| パッケージ | はい | いいえ |
| Loading onto Truck | No (unless agreed) | はい |
| 輸出通関手続き | いいえ | はい |
| Transportation to Port | いいえ | はい |
| Freight Shipping | いいえ | はい |
| Import Clearance & Delivery | いいえ | はい |
Advantages and Disadvantages of EXW
In Ex Works, the importer is liable for all the risks and expenses from the point and time the goods have been made available to them.
So diligence and comprehensive planning are necessary.
EXW can be complicated and tricky for a buyer shipping from China.
This is because they will still require the supplier’s authority or communication in order to clear the merchandise through customs.
Or, give documents to freight partners during the transportation process.
Shipping on Ex Works terms may be the best alternative for sellers with inadequate knowledge in logistics and overseas shipping from China.
Considering that the only responsibility borne by the seller is to make sure that the goods have been packaged properly for delivery to the purchaser’s disposal.
There are minimal consequences for the supplier.
But irrespective of the reduced risk, the EXW terms may not be the most economical choice for the seller.
When you decide to solely use EXW Incoterm as a supplier, a buyer may opt to select another seller with a more appealing and simpler deal.
Step-by-Step: How to Ship Under EXW from China
1. Confirm EXW Terms with the Supplier
Ensure that the seller agrees to provide EXW terms and specify the pickup location (factory address, warehouse, etc.).
2. Appoint a Freight Forwarder
Hire an experienced China-based freight forwarder (like BRF SHIPPING GROUP) to handle:
3. 配置する Cargo Pickup
Your forwarder collects the goods from the seller’s premises, often by truck.
4. Handle Export Customs
As the buyer, you’re responsible for export declarations and any required licenses or documentation.
5. Ship the Cargo
Select your preferred shipping method (FCL, LCL, air freight) and manage transport to your destination port.
6. Clear Customs and Receive Goods
Upon arrival, work with your forwarder or customs broker to:
Clear import customs
Pay duties/VAT
Arrange delivery to your warehouse or customer
What is the Difference Between EXW and FOB in Shipping Terms?
Both EXW and FOB are Incoterms dictating various responsibilities of buyers and sellers in international shipping.
However, they vary in a few aspects, which include the following;
Under EX works, the seller is not mandated to load the cargo on buyer’s designated mode of transport.
Instead, it is the buyer’s responsibility to ensure they take the goods to the respective buyer’s selection. While at it, it is the buyer that incurs the transport charges.
Shipping and associated risks are no longer a liability for the seller under EXW option; hence this incoterm tends to favor the shipper.
On the other hand, under FOB, the seller must load goods on the buyer’s preferred shipping method and the selected shipping point.
In some instances, the seller may also be responsible for the goods throughout the trip to the ultimate seller’s destination.
In essence, FOB means the seller retains ownership and liability of the goods until they are loaded “on board” shipping vessels.
But immediately after the goods are loaded on the vessel, the risk transfers to the buyer.
Technically, EXW is more favorable to the seller even though the seller also has limited responsibilities.
However, FOB is relatively more favorable to the buyer than a seller. It incorporates more responsibilities to the vendor.
Tips for Successful EXW Shipping from China
Work with a Local Forwarder: This ensures smoother pickup and export clearance in China.
Check Export Capabilities: Confirm your supplier can assist with documentation if needed.
Use a Pre-Shipment Inspection: To verify goods before shipment since you won’t be present on-site.
Understand Chinese Export Laws: Know the required documents and licenses.
Is EXW Right for You?
| Situation | Recommendation |
|---|---|
| Experienced importer with local forwarder | EXW is a good choice |
| New to international shipping | Consider FOB or CIF instead |
| Large shipments with complex logistics | EXW may not be ideal |
| Buying from small factories without export license | May face delays or legal issues |
What are the Ideal EXW Tips and Tricks to know?
When opting for EXW, you must ensure that you use a few but critical tips and tricks such as the following;
- If the exporter will assist in loading the commodities, ensure to include the arrangement somewhere in the contract.
This, however, should never be a problem if you are importing from China, particularly with a reputable freight forwarder such as Bansar.
- Under EXW, the buyer is not obliged to arrange a contract of carriage. It, therefore, implies that the importer may sell the commodities to a customer who will then organize how to collect the same.
- Always ensure that the exporter hands over a courier receipt or FCR to the buyer’s freight forwarder. This is a better option rather than handing over the Bill of Lading or Airway bill.
- Sellers will never have direct evidence of export in case they should otherwise be able to claim a rebate from domestic sales tax.
Why Choose BRF LOGISTICS for EXW Shipping?
Local teams in major Chinese export cities
Experts in handling EXW pickups & export documentation
End-to-end freight solutions tailored to your needs
Real-time tracking and customs support
よくある質問（FAQ）
Q1: Can a Chinese supplier refuse to help with export clearance under EXW?
Yes. Under EXW, the seller has no obligation to assist, though many still help out informally.
Q2: Who pays for customs duties under EXW?
The buyer is responsible for all customs duties, taxes, and clearance both at export and import.
Q3: What if I can’t clear Chinese customs myself?
Hire a freight forwarder with export clearance services. BRF SHIPPING GROUP can act on your behalf.
Q4: Is EXW cheaper than FOB or CIF?
It may seem cheaper upfront but could cost more in coordination and risk if not handled well.
