What are the abbreviations for export agency methods? What services do EXW/FOB/CIF/DDP actually represent?

I.Export RepresentationWhat are the common abbreviations for methods?

The commonly used export agency method abbreviations in international trade mainly originate from the International Commercial Terms (Incoterms® 2025) formulated by the International Chamber of Commerce:

• EXW(Ex Works) Factory delivery
• FCA(Free Carrier) Free carrier
• FOB(Free On Board) Free on board
• CFR(Cost and Freight) Cost and freight
• CIF(Cost Insurance and Freight) Cost, insurance, and freight
• DAP(Delivered At Place) Delivered at place
• DDP(Delivered Duty Paid) Delivered duty paid

How are responsibilities divided for these abbreviations?

According to the latest version of Incoterms® 2025, the division of responsibilities for major trade terms is as follows:

• EXW
  • The seller is only responsible for preparing goods at the specified location
  • The buyer bears all transportation risks and costs
• FOB
  • The seller is responsible for costs before goods cross the ships rail
  • The buyer bearsMaritime TransportationMain freight and insurance costs
• CIF
  • The seller pays freight to the destination port and basic insurance
  • Risk transfer still takes place at the ships rail at the port of shipment

How to avoid misunderstandings in term usage?

Common issues in practice and corresponding suggestions:

• Mismatched transportation methods

  For example, FOB is only applicable to sea transport,Air TransportationFCA should be chosen instead

• Confusion over risk transfer points

  The 2025 edition particularly emphasizes risk definition during electronic document exchange

• Inadequate insurance coverage

  CIF defaults to minimum coverage only; it is recommended to add additional coverage based on cargo characteristics

How should companies of different scales choose agency methods?

• Preferred solution for small and medium exporters
  • Recommend FOB mode to control domestic segment costs
  • Suggest purchasing domestic freight insurance as supplementary coverage
• Applicable model for large manufacturers
  • Adopt DDP to enhance end-customer experience
  • Need to establish professional overseas customs clearance teams

What are the considerations regarding the latest policies?

According to 2025 international trade regulations:

• The legal validity of electronic bills of lading requires special agreement under DAP/DDP terms
• Carbon emission surcharges must clearly specify allocation methods in CIF/CFR
• Cross-border E-commerceB2B transactions are recommended to prioritize FCA terms