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INCOTERMS® 2020

Incoterms® 2020 cost calculator

See which shipping costs the seller and the buyer pay under each Incoterms® 2020 rule, from EXW to DDP, and the price the seller needs to quote to cover them.

By the CalcBloc teamLast verified

Your details

01Sale

02Shipping costs

Price to quote under FOB

$20,500

goods $20,000 + $500 of costs the seller pays; the buyer pays $4,110 more

Costs the seller pays
$500
Costs the buyer pays on top
$4,110
Total landed cost for the buyer
$24,610
Risk passes
when the goods are on board the ship
  • Under FOB, risk passes when the goods are on board the ship. The seller's price should cover the goods plus every cost the seller bears under the rule.
  • This is a simplified cost split for quoting, not the rules themselves: who pays terminal handling and unloading can depend on the carriage contract and the named place. Agree the details in the sales contract. The Incoterms® Rules are protected by copyright owned by ICC.
  • Insurance: only CIF and CIP oblige the seller to insure (CIF to minimum Institute Cargo Clauses (C), CIP to Clauses (A)). Under the D rules the seller carries the risk to destination and usually insures; under the others the buyer decides.

Price to quote under FOB: $20,500 goods $20,000 + $500 of costs the seller pays; the buyer pays $4,110 more

Who pays under FOB
Show the breakdownSellerBuyer
Loading at the seller's premises$50$0
Export clearance$100$0
Transport to the port or terminal$200$0
Origin terminal handling and loading on board$150$0
Main freight$0$2,000
Cargo insurance$0$60
Destination terminal handling$0$180
Transport to the final destination$0$300
Unloading at the destination$0$70
Import clearance, duty and import VAT$0$1,500
Total$500$4,110

Price to quote under each rule

RuleSeller's priceRisk passes
EXW$20,000at the seller's premises, when the goods are made available
FCA$20,350when the goods are handed to the buyer's carrier
FAS$20,350when the goods are placed alongside the ship
FOB$20,500when the goods are on board the ship
CFR$22,500when the goods are on board the ship at the port of shipment
CIF$22,560when the goods are on board the ship at the port of shipment
CPT$22,680when the goods are handed to the first carrier
CIP$22,740when the goods are handed to the first carrier
DAP$23,040at the named destination, ready for unloading
DPU$23,110at the named destination, once unloaded
DDP$24,540at the named destination, cleared for import, ready for unloading

$20,500

goods $20,000 + $500 of costs the seller pays; the buyer pays $4,110 more

How it's calculated

An Incoterms® rule decides which shipping costs are in the seller's price and which the buyer pays separately, and where the risk passes. The calculator assigns each cost of a typical shipment to the seller or the buyer under the rule you choose, then adds the seller's share to the goods value to give the price the seller needs to quote. A second table compares all 11 rules.

The split follows the ICC's Incoterms® 2020 rules and the US International Trade Administration's summary of them.International Chamber of CommerceU.S. International Trade Administration The Incoterms® Rules are protected by copyright owned by ICC; this page gives only a simplified summary for costing.

The split

  • EXW: the buyer pays everything from the seller's door, including loading and export clearance.
  • FCA, FAS: the seller clears the goods for export and gets them to the buyer's carrier (or alongside the ship).
  • FOB: as FAS, plus loading on board at the port.
  • CFR, CIF: as FOB, plus main freight to the destination port; CIF adds insurance.
  • CPT, CIP: carriage to the named destination; CIP adds insurance.
  • DAP: everything to the named place except unloading and import clearance.
  • DPU: as DAP, plus unloading. DDP: as DAP, plus import clearance, duty and import VAT.

Worked example

On goods worth $20,000 with $500 of loading, export clearance and port costs, an FOB price needs to be $20,500. Selling CIF, with $2,000 of freight and $60 of insurance, the price becomes $22,560, and DDP, which adds destination charges and $1,500 of import duty and VAT, $24,540.

FOB on $20,000 of goodsSELLER COSTS $500
LineSellerBuyer
Loading at the seller's premises$50$0
Export clearance$100$0
Transport to the port or terminal$200$0
Origin terminal handling and loading on board$150$0
Main freight$0$2,000
Cargo insurance$0$60
Destination terminal handling$0$180
Transport to the final destination$0$300
Unloading at the destination$0$70
Import clearance, duty and import VAT$0$1,500
Total$500$4,110

Assumptions and limitations

  • Simplified. Who pays terminal handling and unloading can depend on the carriage contract and the named place.
  • Insurance: only CIF and CIP require the seller to insure; the calculator treats insurance as a seller cost under the D rules because the seller carries the risk.
  • Agree details in the contract, including the named place, which changes what each party pays.
FAQ

Questions people ask

What are Incoterms?

Incoterms® are standard trade terms published by the International Chamber of Commerce that set out who arranges and pays for each stage of an international shipment and where the risk of loss passes from seller to buyer. The current version, Incoterms® 2020, has 11 rules, from EXW, where the buyer does almost everything, to DDP, where the seller delivers with import duties paid.

What is the difference between FOB and CIF?

Both are for sea freight and pass risk to the buyer once the goods are on board the ship at the port of shipment. Under FOB the buyer pays the main freight and insurance; under CIF the seller pays the freight to the destination port and buys minimum insurance cover for the buyer. So a CIF price is higher, but the buyer carries the risk from the same point.

Which Incoterm should a small exporter use?

Many small exporters use FCA rather than EXW, because under EXW the buyer must handle export clearance in the seller's country, which can be impractical. For container shipments, FCA and CPT or CIP are often more appropriate than the sea-only FOB, CFR and CIF rules, because the goods are handed over at a terminal before loading.

Who pays import duty and VAT under DAP and DDP?

Under DAP the seller delivers to the named place but the buyer handles import clearance and pays duty and import VAT. Under DDP the seller pays them too. DDP can be hard for a foreign seller, since it may need to register for VAT in the destination country to pay and recover the import VAT.

Is this calculator a substitute for the Incoterms rules?

No. It is a simplified cost split for working out a quote. The rules themselves set out each party's obligations in detail, and who pays charges such as terminal handling depends on the contract of carriage and the named place. Agree the rule, the named place and any variations in writing with your buyer.

Sources

  1. International Chamber of CommerceIncoterms® 2020 · retrieved 2026-10-20
  2. U.S. International Trade AdministrationKnow your Incoterms · retrieved 2026-10-20

By the CalcBloc teamLast verified

How every figure is checked: methodology.