Incoterms 2020: EXW, FOB, CIF, DAP and DDP Explained

EXW (Ex Works): you collect the goods at the supplier's factory and handle everything. Maximum control, maximum work. FOB (Free On Board): the supplier delivers the goods on board the vessel; you handle ocean freight onward. The classic ocean term, and still the most common for Asia–Mexico container trade.

CIF (Cost, Insurance and Freight): the supplier arranges ocean freight and minimum insurance to the destination port; you handle Mexican customs and inland delivery. DAP (Delivered At Place): the seller delivers to your named destination, but you handle import customs and duties. DDP (Delivered Duty Paid): the seller handles everything including Mexican customs, duties and taxes: the simplest buying experience, usually at a premium.

If you work with a forwarder, EXW or FOB give you the most control: your forwarder manages the international leg with your interests in mind. CIF can look cheaper but often hides expensive destination charges set by the supplier's forwarder. DDP is the right choice when you have no Mexican entity or want a single all-in price: reputable forwarders quote DDP transparently with the duty and tax components identified.

Whatever term you choose, make sure the commercial invoice states it clearly: Mexican customs uses the Incoterm to validate the declared customs value.