FOB vs DDP when buying from China
Under FOB, the supplier delivers the goods onto the vessel at a Chinese port and you pay and manage freight, insurance, duties and customs clearance from there. Under DDP, the seller delivers to your address with freight, duties and clearance included in one price. FOB gives you more control; DDP gives you a fixed landed price and less work.
FOB (Free on Board)
The seller clears the goods for export and loads them onto the vessel at the named port, for example FOB Ningbo or FOB Shanghai. Risk passes to you once the goods are on board. You book the freight, insure the cargo and handle US customs through your own forwarder and broker.
DDP (Delivered Duty Paid)
The seller delivers the goods to your address, cleared for import, with duties paid. You receive one price that already includes freight, duties and clearance. Ask who acts as importer of record, because that party is legally responsible to US customs.
Comparison
| FOB | DDP | |
|---|---|---|
| Freight and insurance | You | Seller |
| US duties and tariffs | You | Seller, included in price |
| Customs clearance | Your broker | Seller's broker |
| Risk transfer | On board at the Chinese port | At your address |
| Price you see upfront | Product only | Full landed price |
| Best for | Buyers with their own forwarder | Buyers who want one fixed price |
How to choose
- Choose FOB if you already have a forwarder with good rates and want control over shipping.
- Choose DDP if you are new to importing or want the landed cost fixed before you commit.
- On either term, ask for a written breakdown so you can compare quotes fairly.
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