How to choose

The two key parties involved in an international trade transaction are the buyer and the seller. Although both have entered into a mutually beneficial sales agreement, the contract may contain terms that define the different roles, responsibilities, and costs of each party.
Incoterms are a set of pre-defined international rules that should be used in a sales transaction. They specify the conditions for transporting the shipment and outline the respective responsibilities of the importer and the exporter.

The best Incoterms for sellers

There are a total of 11 Incoterms you can choose from. As a supplier/seller, some are more advantageous for you, as they give you greater control over the overall delivery costs.

CFR & CIF: Cost and Freight – Cost, Insurance and Freight
The terms CFR and CIF are usually good options for the seller because they are competitive and do not involve much risk. Under these Incoterms, you have control over the international transport costs up to the port of destination. This gives you the flexibility to choose more cost-effective shipping options, such as the best routes, rates, and transit times.
DDP & DAP: Delivered Duties Paid – Delivered at Place
Under DDP and DAP, the seller is responsible for delivering the goods to the designated location or the buyer’s warehouse in the country of destination. This means that since you will control a large part of the shipping process, including what happens in the destination country, you must make sure you are familiar with the import laws and regulations of that country.
FOB: Free on Board
The FOB Incoterm is one of the most commonly used in international trade. When working under FOB, the seller is responsible until the goods are loaded onto the vessel at the port of origin. This means you have very little control over delivery times and costs. However, this may work well for suppliers who prefer not to negotiate sea freight rates or simply see no benefit in tracking the shipment.

CFR & CIF: Cost and Freight – Cost, Insurance and Freight
DDP & DAP: Delivered Duties Paid – Delivered at Place

These two Incoterms may seem to provide more control and competitiveness, but they also come with greater responsibilities and risks, especially when dealing with a country you are not familiar with.