If you’re an Amazon FBA seller importing from China , you’ve probably encountered the shipping terms FOB (Free on Board) and EXW (Ex Works) . These are among the most commonly used Incoterms in international trade, and choosing between them can significantly impact your costs, logistics, and overall efficiency .
At first glance, the difference might seem minor, but in reality, it determines who is responsible for what —from getting your goods out of China to ensuring they reach an Amazon fulfillment center. Pick the wrong one, and you might end up dealing with unexpected costs, customs issues, or shipping delays.
So, which one is better for Amazon FBA sellers? The short answer: It depends on your experience, order volume, and whether you want to handle logistics yourself or let your supplier take care of it.
In this guide, I’ll break down the differences between FOB and EXW in a clear and practical way , highlighting their pros, cons, and the best choice based on your situation. By the end, you’ll know exactly which shipping term works best for your Amazon FBA business.
What Do FOB and EXW Actually Mean?
Before we dive into which shipping term is better for your Amazon FBA business, let’s break down what FOB (Free on Board) and EXW (Ex Works) actually mean. Understanding these terms will help you see the responsibilities, risks, and costs involved with each option.
What is FOB (Free on Board)?
With FOB , your supplier takes care of all the initial logistics, ensuring that your goods are ready to leave China smoothly. Under this arrangement, your supplier is responsible for:
✅ Preparing your goods for export (packaging, labeling, and documentation)
✅ Handling all export paperwork and customs clearance
✅ Transporting the goods to the port of departure
Once the goods are loaded onto the ship or plane , ownership and responsibility shift to you , meaning you now handle:
➡️ International freight costs (ocean or air shipping)
➡️ Import duties and customs clearance in your country
➡️ Final delivery to Amazon’s fulfillment center
👉 Key Benefit: Your supplier takes care of the most complex part—export logistics—so you don’t have to deal with customs clearance or inland transportation in China.
What is EXW (Ex Works)?
With EXW , your supplier has the most minimal responsibility. Essentially, they do one thing:
✅ Make the goods available at their factory or warehouse
Everything else—from picking up the shipment to delivering it to Amazon— falls entirely on you . That means you need to handle:
➡️ Local transport from the supplier’s warehouse to the port
➡️ Export customs clearance (which can be complicated and costly)
➡️ International shipping and import duties
➡️ Final delivery to Amazon’s fulfillment center
👉 Key Risk: Since the supplier is not responsible for anything beyond their warehouse , if there are any issues with export documentation, customs clearance, or local transportation, it’s your problem to fix, not theirs .
The Big Difference? FOB Saves You Time and Headaches
With FOB , your supplier is involved in the export process, making sure your goods are cleared for shipping.
With EXW , you are responsible for everything from pickup to export, which can be overwhelming if you don’t have a solid freight forwarder.
For most Amazon FBA sellers, FOB is the smarter and easier option , but we’ll break that down further in the next sections.
Key Differences Between FOB and EXW for Amazon FBA
Now that we’ve covered what FOB and EXW mean, let’s compare them side by side. The main differences lie in who handles logistics, who pays for what, and the level of risk involved .
| Factor | FOB | EXW |
|---|---|---|
| Who Handles Export Paperwork? | Supplier – They take care of customs clearance and documentation | Buyer (You) – You must arrange export clearance, which can be complex |
| Who Pays for Local Transport? | Supplier – They deliver the goods to the port of departure | Buyer (You) – You arrange and pay for trucking to the port |
| Logistics Complexity | Lower – The supplier manages the first part of the shipment | Higher – You must coordinate every step from pickup to export |
| Upfront Cost | Slightly higher – Since the supplier covers export costs, FOB pricing is usually a bit higher | Lower – The supplier’s responsibility ends at their warehouse, so the price looks cheaper |
| Risk Level | Lower – If there are export issues, the supplier is responsible | Higher – You are fully responsible for any customs or shipping problems |
| Best for Beginners? | Yes – FOB simplifies logistics, making it ideal for first-time Amazon FBA sellers | No – EXW requires experience in freight forwarding and export compliance |
What This Means for Amazon FBA Sellers
- FOB is easier to manage because your supplier takes care of export customs and delivery to the port.
- EXW looks cheaper at first but can be more expensive in the long run due to hidden costs like export fees and inland transport .
- For most Amazon FBA sellers, FOB is the better choice because it reduces risk, complexity, and unexpected costs .
Next, we’ll dive into why FOB is usually the best option for Amazon sellers and when EXW might be worth considering .
Why FOB is the Best Choice for Most Amazon FBA Sellers
If you’re an Amazon FBA seller , especially if you’re new to importing, FOB is almost always the smarter choice . It simplifies the shipping process and reduces risks that could cause delays or add unexpected costs . Here’s why:
🔹 Less Work for You
With FOB , your supplier takes care of the export process , which includes preparing documents, clearing customs, and transporting goods to the port. You don’t have to worry about arranging export clearance, dealing with Chinese regulations, or hiring a local trucking service.
🔹 No Hidden Export Fees
Many sellers choose EXW because it seems cheaper upfront , but they don’t realize that they’ll need to pay extra for export clearance, local transport, and documentation . These costs can quickly add up , making EXW more expensive than expected.
With FOB, all export costs are included in the supplier’s price , so you get a clear and predictable cost structure .
🔹 Lower Risk of Delays
When using EXW , if there’s a problem with customs clearance , you are responsible for fixing it— even if you don’t know what went wrong .
With FOB, the supplier handles customs clearance , so if there’s an issue, they are responsible for solving it . This minimizes the chances of delays that could disrupt your Amazon FBA inventory flow .
🔹 Easier for Amazon FBA Compliance
Amazon has strict requirements for product labeling, barcodes, and packaging . With FOB, your supplier can ensure these requirements are met before shipping , reducing the chances of your shipment being rejected by Amazon .
If you use EXW , you may have to coordinate these requirements yourself , which adds another layer of complexity.
When EXW Might Be a Better Option
While FOB is the best choice for most Amazon FBA sellers , there are situations where EXW can make sense —but only if you know what you’re doing.
Who Should Consider EXW?
✔️ Sellers with a Trusted Freight Forwarder – If you already work with a reliable logistics partner who can handle everything (export clearance, transport, and customs), EXW gives you more control over the process .
✔️ Bulk Shipments with Significant Cost Savings – If you’re ordering large volumes , negotiating EXW pricing with a freight forwarder might reduce overall costs.
✔️ When Suppliers Don’t Offer FOB – Some small suppliers prefer EXW because they lack export licenses or don’t want to deal with export procedures. In this case, you may have no choice but to arrange shipping yourself.
⚠️ The Hidden Costs of EXW
At first, EXW pricing looks cheaper because the supplier is only responsible for producing the goods. But you must factor in additional costs , including:
➡️ Local transport from the supplier’s factory to the port
➡️ Export customs clearance and documentation
➡️ Potential additional taxes and fees before shipping
If these costs aren’t calculated before making a decision , you might end up paying more with EXW than you would with FOB.
🔸 Real-World Example: Is EXW Really Cheaper?
Let’s say you receive two quotes from a supplier:
- EXW Price: $10,000
- FOB Price: $10,500
At first, EXW looks like the better deal , right? But now, let’s add the hidden costs of EXW:
- Local transport to the port: $300
- Export customs clearance: $500
- Other documentation fees: $200
Total EXW cost: $11,000 🔺 (more expensive than FOB!)
This is a common mistake sellers make when choosing EXW— they don’t factor in these extra costs and end up losing money.
👉 When to Use EXW? Only If You’re Experienced
- If you’re new to Amazon FBA , FOB is the safer choice .
- If you have logistics experience and a strong freight forwarder , EXW might work—but only if you do the math first .
🚀 Pro Tip: Before choosing EXW, always ask your freight forwarder for a full breakdown of all additional costs so you can compare it fairly to an FOB quote.
Common Mistakes to Avoid
Choosing between FOB and EXW seems straightforward, but many Amazon FBA sellers make costly mistakes that can lead to unexpected fees, delays, or logistical headaches. Here are the most common pitfalls and how to avoid them.
🚫 Thinking EXW is Always Cheaper
Many sellers assume that EXW is the cheaper option because the supplier’s quote looks lower. But in reality, EXW comes with extra costs , including:
❌ Export customs clearance fees
❌ Local transport from the supplier’s warehouse to the port
❌ Export documentation and taxes
✅ Solution: Before choosing EXW, ask your freight forwarder for a full cost breakdown so you can compare it fairly to an FOB quote.
🚫 Choosing EXW Without a Freight Forwarder
If you pick EXW but don’t have a freight forwarder , you’re taking on a huge logistical burden . You’ll need to:
❌ Find a trucking service to transport your goods
❌ Handle export paperwork and customs clearance
❌ Ensure everything is correctly labeled and prepared for Amazon
For beginners, this can cause major delays or compliance issues with Amazon.
✅ Solution: If you don’t have a freight forwarder, FOB is a safer choice since your supplier handles export logistics.
🚫 Not Confirming What’s Included in FOB Pricing
Just because a supplier offers FOB , it doesn’t always mean everything is included. Some suppliers might quote FOB but exclude certain fees , such as:
❌ Export documentation costs
❌ Handling fees at the port
✅ Solution: Before agreeing to FOB terms, ask your supplier for a detailed breakdown of what’s included . This ensures there are no surprises when your shipment is ready to leave.
🚫 Assuming FOB is Always an Option
Some small suppliers or factories don’t have an export license , so they can’t legally offer FOB . Instead, they’ll only sell under EXW , meaning you must handle the shipping process from their warehouse.
✅ Solution: If a supplier only offers EXW, ask if they can recommend a freight forwarder or use a sourcing agent who can handle the export process for you.
🔹 Final Tip: Always Get Quotes for Both FOB & EXW
To make the best decision, always request quotes for both FOB and EXW , and then compare the total costs, including hidden fees. This way, you can avoid unexpected expenses and choose the most cost-effective option for your Amazon FBA business. 🚀
FOB vs EXW: Which One Should You Choose?
Now that we’ve broken down the key differences, costs, and risks, the final question remains: Which shipping term is the right choice for your Amazon FBA business?
Here’s a quick decision guide based on your situation:
| Scenario | Recommended Term |
|---|---|
| New Amazon FBA seller | FOB ✅ (Easier to manage, less risk) |
| Small orders or sample shipments | FOB ✅ (Less hassle, supplier handles export) |
| Bulk orders & experienced with logistics | EXW ✅ (Can reduce costs if managed well) |
| Have a reliable freight forwarder | EXW ✅ (Gives you more control) |
| Supplier doesn’t offer FOB | EXW ⚠️ (But check total export costs first!) |
👉 Final Verdict: FOB is the Best Option for Most Amazon Sellers
- If you’re just starting out , FOB is the safest and most efficient choice because it simplifies logistics.
- If you have experience and a strong freight forwarder , EXW can sometimes save you money , but only if you properly calculate the extra costs.
- Always ask for both FOB and EXW quotes and compare the full cost—including export fees—before making your decision.
🚀 Bottom line: Unless you’re confident in handling logistics, FOB is the best choice for Amazon FBA sellers.
How to Negotiate the Best Shipping Terms with Your Supplier
Once you’ve decided whether FOB or EXW is best for your Amazon FBA business, the next step is negotiating the best shipping terms with your supplier. Suppliers often default to EXW pricing , but with the right approach, you can secure a better deal and avoid hidden costs .
✅ Ask for FOB First
Many suppliers already prefer FOB because it simplifies their own logistics. Instead of assuming EXW is the only option , directly ask:
“Can you provide FOB pricing to [nearest major port]?”
If they agree, this means they’ll handle export clearance and local transport , making the process easier for you.
✅ If They Insist on EXW, Ask for a Breakdown of Export Costs
If your supplier only offers EXW , don’t just accept it— ask for full transparency on additional costs . Some suppliers will help estimate the costs of:
🔹 Trucking to the port
🔹 Export clearance and documentation fees
🔹 Handling charges before departure
This helps you calculate the true cost of EXW vs FOB and avoid hidden expenses .
Example negotiation:
📌 “If we go with EXW, can you tell me how much export clearance and trucking will cost? Would you be able to arrange these for me?”
Sometimes, suppliers can help coordinate these services even if they don’t provide FOB directly.
✅ Work with a Good Freight Forwarder
If you must use EXW , you need a reliable freight forwarder to handle:
✔️ Local transport from the supplier to the port
✔️ Customs clearance and export documentation
✔️ Shipping to your country and Amazon FBA warehouse
🚀 Pro Tip: If you’re using EXW, choose a freight forwarder with experience in Amazon FBA to ensure they meet Amazon’s strict receiving requirements .
✅ Get Everything in Writing
To avoid misunderstandings and unexpected fees , always request a detailed written agreement that includes:
✔️ Exact responsibilities of the supplier (who covers what?)
✔️ What’s included in the FOB or EXW price
✔️ Breakdown of any additional charges
📌 Example confirmation message:
“Just to confirm, for FOB to [port name], you’ll handle export clearance, local transport, and customs paperwork. There will be no additional fees on my side until the goods are loaded onto the ship/plane. Please confirm.”
A clear agreement ensures no last-minute surprises and makes it easier to dispute unexpected fees.
🚀 Takeaway: Always Negotiate & Compare Costs
- Start with FOB negotiations first —it’s usually the best option for Amazon FBA.
- If stuck with EXW, get a full breakdown of additional costs before committing.
- A strong freight forwarder can make EXW manageable , but only if you trust them.
- Always get everything in writing to protect yourself from hidden fees.
By negotiating smartly, you can optimize your shipping costs and avoid costly mistakes , making your Amazon FBA business more profitable and hassle-free .
Making the Right Choice for Your Amazon FBA Business
Choosing between FOB and EXW for your Amazon FBA shipments is a critical decision that impacts costs, logistics, and overall efficiency . While both options have their place, the right choice depends on your experience level and ability to manage shipping logistics .
💡 FOB is usually the best choice for Amazon FBA sellers because it’s easier, safer, and more predictable . Your supplier takes care of export customs and transport to the port, reducing risks and hidden costs.
💡 EXW can work if you have experience and a trusted freight forwarder , but it comes with more risks and responsibilities . If you don’t factor in export fees and local transport costs, you might end up paying more than you expected .
💡 Before choosing, always calculate your total landed cost , not just the supplier’s price. Hidden expenses can make EXW more expensive than FOB , so make sure you compare both options carefully.
🚀 Need help shipping your Amazon FBA goods from China? Work with a trusted freight forwarder to ensure a smooth process, avoid delays, and eliminate unexpected costs!
By making an informed decision , you can streamline your logistics, optimize your shipping costs, and grow your Amazon FBA business without unnecessary headaches .
FAQ: FOB vs EXW for Amazon FBA Sellers
What is the main difference between FOB and EXW?
FOB (Free on Board) means the supplier handles export clearance and delivers the goods to the port. Once the shipment is loaded onto the ship or plane, responsibility transfers to the buyer. EXW (Ex Works) means the supplier only makes the goods available at their warehouse, and the buyer is responsible for all transportation, export clearance, and shipping logistics.
Which shipping term is better for Amazon FBA?
For most Amazon FBA sellers, FOB is the better choice because it simplifies logistics, reduces hidden costs, and minimizes risks. EXW is only recommended for sellers with an experienced freight forwarder who can efficiently handle export procedures.
Is EXW cheaper than FOB?
At first glance, EXW pricing appears lower because it only includes the cost of the goods. However, hidden costs such as export fees, local transport, and documentation can make EXW more expensive than FOB. It is essential to calculate the total cost, including all additional charges, before making a decision.
Can I ask my supplier to offer FOB instead of EXW?
Yes, many suppliers prefer FOB because it simplifies their own shipping process. It is always advisable to ask for an FOB quote first. If a supplier only offers EXW, you should request an estimate of export costs so that you can compare the total price accurately.
What happens if there is a problem with export customs?
With FOB, the supplier is responsible for clearing the goods through export customs, which means they must resolve any issues before shipping. With EXW, the buyer is fully responsible for export clearance, meaning they will need to handle any customs problems themselves or rely on a freight forwarder.
Can I use EXW if I am new to Amazon FBA?
While it is possible to use EXW, it is not recommended for beginners unless they have a reliable freight forwarder to manage export logistics. FOB is a safer and easier option, as it allows the supplier to take care of export formalities.
Do all suppliers offer FOB?
Not all suppliers offer FOB, especially smaller manufacturers that do not have an export license. In such cases, they can only provide EXW, and the buyer must arrange for export clearance and shipping. If a supplier only offers EXW, working with a freight forwarder can help simplify the process.
How do I avoid hidden fees with FOB or EXW?
For FOB, it is important to confirm with the supplier that all export costs, including customs clearance and transportation to the port, are included in the price. For EXW, you should request a detailed breakdown of additional costs, such as local transport and documentation fees, to ensure there are no surprises later.
What is the safest option if I do not want to deal with shipping headaches?
FOB is the safest option for most Amazon FBA sellers because the supplier handles export logistics, reducing the risk of unexpected complications. If using EXW, it is crucial to have a reliable freight forwarder who can manage the entire shipping process efficiently.
