Two quotes arrive in the same week for the same container of dirt bikes. One says FOB Ningbo. One says CIF Mombasa. The second number is bigger, so it looks like the safer, more complete offer. It is not the same product, and comparing them directly is how dealers lose the margin they thought they had locked. The US Department of Commerce explains why in one line on its Incoterms page: these terms “specify who is responsible for paying for and managing the shipment, insurance, documentation, customs clearance, and other logistical activities” (trade.gov, Know Your Incoterms, checked 28 October 2026). Change the term and you changed who pays for which line, and where the risk sits if something goes wrong at sea.
What each term actually hands over
Both FOB and CIF are among the eleven International Chamber of Commerce rules that trade.gov documents. Neither is “better”. They simply cut the transaction at different points, and a dealer needs to know where the cut is before signing.
| Cost line | FOB (named port of loading) | CIF (named port of destination) |
|---|---|---|
| Goods and export packing | Seller | Seller |
| Inland haul to the port, export clearance | Seller | Seller |
| Ocean freight | Buyer books and pays | Seller, inside the quoted price |
| Marine insurance | Buyer, if wanted | Seller, minimum cover typical for the trade |
| Import duty, tax, destination handling, port charges at arrival | Buyer | Buyer, still |
| Where the goods risk passes to the buyer | When the cargo is on board at the loading port | Also when the cargo is on board at the loading port |
That last row is the one dealers miss. CIF moves more cost to the seller. It does not move more risk. Your cargo is still your cargo once it is on the vessel, and a CIF price that looks complete can still leave you paying destination charges, storage and broker fees that were never inside the number.
Why the FOB quote is the one you can compare
FOB stops at the loading port, which means every supplier quoting FOB is quoting the same slice of the journey. You can put three factories side by side, see the real spread on goods and packing, and then buy freight where you buy freight. A CIF quote hides the freight inside the goods price, so two factories quoting CIF on the same route are telling you almost nothing about which one is cheaper to buy from. The difference you see might be nothing more than a forwarder markup.
There is a second reason that matters more to a dealer with a margin to protect: you cannot manage a cost you cannot see. When the ocean freight sits inside the unit price, a rate spike six weeks before shipment either eats the supplier’s margin or yours, and the argument happens after the order is signed instead of before.
Five questions that turn a CIF number into something usable
- Which port pair, and which inland leg? CIF to “your country” is not a quote. Ask for loading port, discharge port, and whether the inland haul from discharge to your yard is inside or outside the number.
- What insurance cover, at what value? Minimum trade cover and all-risks cover are different prices. Ask which one is in the quote and on what declared value.
- Which destination charges are excluded? Terminal handling, port dues, container cleaning and demurrage are almost always the buyer’s. Get them named so you can price them locally.
- Who books the space, and who owns the bill of lading? The name on the bill of lading decides who can claim and who can release cargo. A CIF deal with unclear bill of lading handling is a slow-motion dispute.
- What happens if the sailing is rolled? Storage and re-booking charges at origin need an owner before the container leaves the yard, not after.
The dealer move: normalise the quote before you compare
In practice the workable pattern is to ask every supplier for the same sheet: FOB price per model and configuration, crate dimensions and quantity per container (our own loading plan by model shows the shape of that sheet), loading port, and the document set that travels with the shipment. Then price freight separately with your own forwarder, and compare the two totals only after you have added the same destination charges to both.
This is also how FCDC Motor quotes. Goods price is quoted per model and per configuration, freight is quoted separately against your destination port and crate plan, and the export document set is listed rather than implied. Import duty and destination taxes stay outside our quote, because they belong to your broker and your tariff line, the same split described on our customs and import page. A single headline number that folds all of it together hides the assumptions, and the assumptions are where the deal actually breaks.
| Field on the normalised sheet | Why it decides the comparison |
|---|---|
| Model, configuration, engine code | A price without the configuration is not a price; the same model name can ship in more than one build |
| Incoterm plus named port | Fixes the cut point for cost and risk |
| Crate count and loading plan | Freight is priced per crate volume, not per emotion |
| Spare parts ratio in the same shipment | Parts landed later as parcels cost more than parts landed in the container, see the first-container parts ratio |
| Document set | Invoice, packing list and battery transport documents have to exist before the vessel sails |
FAQ
Is CIF more expensive than FOB?
The CIF number is larger because it includes freight and insurance, but that does not make the deal worse by itself. It becomes worse when the freight inside it was never itemised, so you cannot tell a fair rate from a padded one. Ask for the freight line separately even on a CIF offer.
Under CIF, when do I own the risk?
When the cargo is on board at the loading port, not when it reaches your port. Insurance inside a CIF price covers the voyage, but a claim still needs documents and a named insured. Confirm who is insured and who files if a crate arrives damaged.
Can FCDC Motor quote CIF instead of FOB?
Ask, and we will tell you what can be arranged for your destination and what stays outside it. What we will not do is fold destination duty and tax into a headline number, because those depend on your tariff line and your broker’s entry, not on our invoice.
Send the model mix, the destination port and the quantity to Get Quote, and the reply comes back split by goods, freight and documents so the two quotes in front of you can finally be compared side by side.