EXW (Ex Works): what the factory price covers, and what it does not

Who does what under an EXW price

An EXW quote is the factory's price for goods ready to collect. Everything that moves them is on you.

The two traps: loading and export clearance

Delivery under EXW happens when the seller places the goods at the buyer's disposal, without loading them or clearing them for export^[1]. The goods are placed, not loaded. The seller may well load your truck anyway. If cartons are damaged while it does, the ICC's note on the rule says the risk might arguably lie with the buyer^[1], who had no hand in the loading. A buyer who wants the seller to carry that risk should ask for FCA instead, under which a seller delivering at its own premises must load the goods.

Export clearance is the second trap. It is your job under EXW, even though the seller is the party based in the exporting country. The ICC advises a buyer who expects difficulty to choose FCA, where the obligation and cost of export clearance sit with the seller. It also notes that EXW may be suitable for domestic trades^[1], where nothing crosses a border.

When an EXW quote still works

EXW is workable when your freight forwarder has an office or agent near the factory and can collect, clear and ship the goods for a known fee. If not, ask the seller for an FCA or FOB price and compare the difference with what your forwarder charges for pickup and export clearance. If the FOB price is higher by less than those origin charges, the FOB quote is the cheaper one.

EXW and the value you pay duty on

For goods entering the United States, the value that duty is charged on excludes international freight and insurance^[2], and when the price is ex-factory, the foreign inland freight is not added to it^[3]. So the freight you pay on top of an EXW price does not raise your US duty. The European Union works the other way: its customs value includes transport and insurance up to the point where the goods enter the EU^[4], so an EU importer pays duty on the freight to the border as well.

Line	Amount
EXW price, 2,000 units at $4.00	$8,000
Pickup, loading and export clearance through your forwarder	$440
Ocean freight and insurance to the US port	$930
Value for US duty (the EXW price)	$8,000
Duty at 10% (assumed)	$800
Port, customs fees, broker and delivery at destination	$510
Landed cost	$10,680
Landed cost per unit	$5.34

Illustrative figures, not a quote. Real prices depend on the spec, quantity and factory.

An EXW price usually looks lower than an FOB price from the same factory, because it leaves out the origin charges; once you add them, the landed cost can come out level. Compare EXW quotes with the other Incoterms on landed cost per unit, never on the unit price alone. Every quote we send names its rule and named place, so you can see which costs sit outside our price.