International Commercial Terms (Incoterms) for B2B: The Ultimate Logistics Guide

Incoterms for B2B are 11 standardized three-letter rules published by the International Chamber of Commerce (ICC). They spell out exactly who pays for what, who carries the risk, and when that risk moves from seller to buyer in a global shipment. On a route as procedurally heavy as China to India, picking the wrong term — say, EXW when you needed DDP — is often the difference between a smooth delivery and a container stuck at customs.

Key Takeaways: International commercial terms (Incoterms) for B2B

We know the China–India corridor cold. Years of moving cargo through this specific lane means we’ve already solved the regulatory snags most freight forwarders are still learning.
DDP without the guesswork. Instead of leaving you to decode Incoterms alone, we offer full Delivered Duty Paid service — you get a landed cost up front, not a surprise invoice at the border.
One provider, start to finish. From our warehouses in China to last-mile delivery in India, we don’t hand your cargo off between five different vendors — we own the whole journey.
Compliance handled, not outsourced. BIS certificates, FDA registrations, Indian customs paperwork — our team manages it so you don’t have to become a customs expert overnight.

A Deeper Look at B2B Incoterms

Here’s where most of the trouble starts: businesses assume they know who’s responsible for what, and they’re wrong. Get the terms confused and you end up with cargo sitting in a bonded warehouse, demurrage fees stacking up by the day, and a supplier relationship under real strain.

At SCIC Group, this comes up in nearly every client conversation. So let’s walk through the 11 official ICC rules, grouped the way the ICC actually groups them — by which transport modes they apply to.

Rules That Work for Any Transport Mode

These seven terms apply whether your cargo moves by air, sea, rail, or some combination of the three.

EXW (Ex Works): The buyer takes on almost everything here. The seller’s only job is to make the goods available at their own location — a factory in Shenzhen, for instance. From that point, the buyer arranges and pays for transport, clears export customs, and carries all the risk.
FCA (Free Carrier): The seller clears the goods for export and hands them to a carrier the buyer has chosen, at an agreed location. Risk passes the moment that handoff happens.
CPT (Carriage Paid To): The seller covers freight costs to the named destination — but risk transfers much earlier, the instant the goods reach the first carrier at origin. Cost and risk don’t move together under this term, which trips people up.
CIP (Carriage and Insurance Paid To): Works like CPT, except the seller is also required to buy comprehensive insurance covering the buyer’s risk during transit.
DAP (Delivered at Place): The seller delivers the goods, ready to unload, at the named destination. Everything up to that point — cost and risk — sits with the seller, except import clearance, which stays with the buyer.
DPU (Delivered at Place Unloaded): Formerly DAT. The seller not only delivers but physically unloads the cargo at the named terminal, carrying all risk and cost through that step.
DDP (Delivered Duty Paid): The heaviest lift for the seller. Everything — cost, risk, import duties — is on them until the goods reach the buyer’s door. This is the model SCIC Group specializes in, precisely because it removes compliance headaches from your side of the table.

Rules Specific to Sea and Inland Waterway Transport

These four apply only to ocean freight and bulk cargo loaded straight onto a vessel.

FAS (Free Alongside Ship): The seller clears export customs and places the goods alongside the ship at the named port. Risk shifts right there, dockside.
FOB (Free On Board): One of the most common B2B terms in practice. The seller clears export and loads the goods onto the vessel the buyer nominated. Risk transfers the moment cargo touches the ship’s deck.
CFR (Cost and Freight): The seller pays ocean freight to the destination port, but risk still transfers at origin — as soon as goods are loaded aboard.
CIF (Cost, Insurance and Freight): Same cost structure as CFR, with one addition: the seller must also arrange and pay for marine insurance covering the buyer’s risk during the voyage.

Where Businesses Get Stuck — and How We Fix It

The problem: A lot of SMEs importing manufacturing equipment from China into India default to EXW or FOB without grasping how demanding Indian customs (ICEGATE) can be. Miss a BIS certificate, or underestimate the import duty, and your cargo can end up seized at Nhava Sheva or Chennai port — sometimes for weeks.

How SCIC Group solves it: For the China-to-India lane specifically, we usually steer clients toward DDP or DAP. Because we have people and partnerships on the ground in both countries, we handle Chinese export clearance, the transit itself, and the notoriously tricky Indian customs process — all under one roof. You get a transparent duty estimate before goods ever leave the warehouse, so nothing derails your supply chain mid-shipment.

🧮 Understanding Volumetric Weight (The Part Most Guides Skip)

Knowing your Incoterm is only half the job — knowing how carriers actually bill you is the other half. Whatever term you’re shipping under, EXW, FOB, or DDP, carriers charge based on whichever is higher: your cargo’s actual weight, or its volumetric (dimensional) weight.

What is volumetric weight, exactly? Aircraft and vessels have limited space, not just limited weight capacity. A giant box of pillows might weigh next to nothing, but it eats up the same space as 500 kg of steel. Volumetric weight is how carriers make sure they’re paid for the space your cargo occupies, not just its mass.

The standard formulas:

Shipping Method	Formula
Air Freight Express	(Length × Width × Height in cm) ÷ 5000
Standard Air Freight	(Length × Width × Height in cm) ÷ 6000
Sea Freight (LCL)	Calculated per Cubic Meter (CBM); 1 CBM ≈ 1,000 kg

A quick example: Say you’re shipping 5 boxes of electronics from Shenzhen to Mumbai under CIF terms. Each box measures 50cm × 50cm × 50cm and weighs 15 kg.

Actual weight: 5 × 15 kg = 75 kg
Volumetric weight: (50 × 50 × 50 ÷ 5000) × 5 = 125 kg

Since 125 kg is the larger figure, that’s what the airline bills you for — not the 75 kg the boxes actually weigh. This is exactly the kind of detail our team flags early, helping clients repack more efficiently so they’re not overpaying for empty space.

Restricted & Hazardous Items to Watch For

Certain categories of goods face tighter scrutiny when entering Thailand or India, regardless of which Incoterm you’re using. If any of these apply to your shipment, it’s worth talking to a specialist before you book:

Batteries & electronics: Lithium-ion batteries need MSDS documentation and UN38.3 test reports.
Chemicals & liquids: Industrial chemicals require HAZMAT declarations and specific packaging, or they risk confiscation.
Pharmaceuticals & medical devices: Need FDA (Thailand) or CDSCO (India) pre-approval, often with cold-chain handling.
Food & agricultural products: Subject to phytosanitary inspection and quarantine review.

Incoterms at a Glance: Cost & Risk Transfer

Incoterm	Seller Pays Freight?	Risk Transfers At	Import Duty Handled By
EXW	No	Seller’s premises	Buyer
FCA	No	Named place / first carrier	Buyer
FOB	No	On board the vessel at origin port	Buyer
CFR	Yes (to destination port)	On board the vessel at origin port	Buyer
CIF	Yes (including insurance)	On board the vessel at origin port	Buyer
CPT	Yes	First carrier at origin	Buyer
CIP	Yes (including insurance)	First carrier at origin	Buyer
DAP	Yes	Named destination	Buyer
DPU	Yes	Destination, unloaded	Buyer
DDP	Yes	Buyer’s door	Seller

Frequently Asked Questions (FAQ)

Q1: What's the best Incoterm for importing from China to India?

If you want full control over shipping costs and already have your own customs broker in India, FOB is a solid choice. But if you don’t have that customs presence, DDP through a partner like SCIC Group is the safer, more hands-off route — you’re not left navigating Indian customs solo.

Q2: Does SCIC Group issue tax invoices for B2B logistics services?

Yes. As a fully compliant logistics partner, we provide proper, legal tax invoices covering freight, duties, and handling — so your business can claim these expenses without issue.

Q3: Under CIF vs. CFR, who's responsible for cargo insurance?

Under CIF, the seller must purchase and pay for marine insurance. Under CFR, that obligation doesn’t exist — insurance is on the buyer, and it should be in place from the moment cargo boards the vessel.

Q4: Can I ship liquid chemicals by air freight into Thailand?

Yes, but expect close regulation. You’ll need an MSDS on file, and packaging has to meet IATA Dangerous Goods Regulations. Our team handles the classification and routing so the shipment moves safely and legally.

Scale Your Global Trade Today

Don’t let a misunderstood Incoterm quietly eat into your margins or stall your supply chain. SCIC Group handles the parts most businesses find hardest — precise customs clearance and door-to-door delivery — so you don’t have to.

Ready to streamline your imports? [Get a Free Consultation and Quote for China to India Shipping ]

Contact

India Office:

SCIC TRADEX INDIA PVT., LTD.
Ground floor, E-44/3, OkhlaPhase-ll, Delhi 110020, India 110020
Tel: +91 9319510127
Email: scictradex.india@gmail.com

Bangkok, Thailand Office:

SCIC THAILAND CO., LTD.
PNS BUILDING, 747 Ratchadanivate Prachauthit Road, Samsennok Huaikwang, Bangkok10310
Tel: +66638602304
Email: scic.thailand@gmail.com