Incoterms are the three-letter codes that decide, at every step between the loom and your warehouse, whose money and whose risk is in play. Rug quotes use a small set of them, and misreading the code is one of the few genuinely expensive documentation mistakes a new importer can make.
The Four You Will Meet
- EXW (Ex Works): you take over at the factory gate — inland transport in India, export clearance, everything. Rare in rugs and rarely wise for a first-timer.
- FOB (Free on Board): the supplier delivers export-cleared goods onto the vessel at an Indian port; you pay and manage from there via your forwarder. The standard of the trade — clean split, transparent costs.
- CIF (Cost, Insurance & Freight): the supplier also pays ocean freight and minimum insurance to your named port; risk still passes to you at loading. Convenient for a first order; slightly opaque on the freight component.
- DDP (Delivered Duty Paid): the supplier delivers to your door with duties paid. Maximum convenience, maximum hidden margin — and duty handled in your name by someone else, which some importers reasonably dislike.
The Distinction Everyone Misses
Cost and risk transfer are not the same thing. Under CIF the supplier pays the freight, but the goods travel at your risk from the moment they cross the ship's rail — which is why the insurance certificate matters and why you should know its terms.
Our Recommendation for First Orders
CIF for the very first shipment if you want simplicity; FOB with your own forwarder from the second onward for cost transparency and control. We quote both side by side as standard, with packing dimensions your forwarder can price from. Request a two-term quotation and compare with real numbers.