If you've ever asked a Chinese supplier for a price, you've probably seen FOB or EXW at the end of their quotation. And if you've talked to a freight forwarder, you've heard about DDP. What's the difference — and which one should you choose?
Choosing the right Incoterm (International Commercial Terms) can save you thousands of taka — or cost you. Here's a plain-English breakdown.
What Is FOB (Free On Board)?
FOB means the Chinese supplier is responsible for getting your goods to the port and loading them onto the ship. After that, everything is your responsibility — ocean freight, insurance, customs clearance in Bangladesh, duties, taxes, and delivery to your door.
Who pays for what under FOB?
- Supplier pays: Production, inland transport to China port, export customs clearance, loading onto vessel
- You pay: Ocean/air freight, insurance, import customs clearance in Bangladesh, all duties & VAT, port handling, delivery to your door
FOB sounds cheaper at first — the supplier's price is lower. But when you add up freight + customs + duties + delivery, the total cost often ends up higher than DDP. And you have to manage multiple parties.
What Is DDP (Delivered Duty Paid)?
DDP means the supplier (or your freight forwarder) is responsible for everything — from the factory in China all the way to your door in Bangladesh. This includes production, inland transport, ocean/air freight, export and import customs clearance, all duties, all taxes, insurance, and final delivery.
Who pays for what under DDP?
- Forwarder pays (included in your price): Everything. Production, transport, shipping, customs, duties, VAT, delivery
- You pay: One all-in price. No hidden costs.
DDP is more expensive per unit upfront, but it's predictable. You know exactly what you'll pay before you order. No surprises at customs.
FOB vs DDP — Side by Side
| Factor | FOB | DDP |
|---|---|---|
| Upfront price | Lower (supplier price only) | Higher (all-inclusive) |
| Total landed cost | Often higher when you add freight + duties | Predictable, one price |
| Who arranges shipping? | You (separate freight forwarder) | Your forwarder — included |
| Who handles customs? | You (Bangladesh broker) | Your forwarder — included |
| Who pays duties & VAT? | You, after cargo arrives | Included in the price |
| Risk of hidden costs | High (port fees, storage, inspections) | Low (fixed price) |
| Best for | Experienced importers with own broker | New importers, business owners who want simplicity |
Which One Should You Choose?
Choose FOB if:
- You're an experienced importer with your own customs broker in Bangladesh
- You ship large volumes (FCL containers) regularly
- You have the time and expertise to manage freight, customs, and delivery yourself
Choose DDP if:
- You're new to importing or want predictable costs
- You don't want to deal with customs brokers, port fees, or duty calculations
- You value simplicity — one contact, one price, delivery to your door
- You're shipping small-to-medium volumes (samples, e-commerce inventory, LCL)
Most Bangladeshi importers prefer DDP
Why? Because customs clearance in Bangladesh can be complicated — duty rates vary by HS code, port delays are common, and storage fees add up fast. With DDP, MashXpress handles all of it. You pay one price upfront and receive your goods at your door with zero stress.
Get a DDP Quote →Other Incoterms You Might See
- EXW (Ex Works) — supplier just makes the goods available at their factory. You handle EVERYTHING including loading. Cheapest supplier price, most work for you.
- CIF (Cost, Insurance, Freight) — supplier pays for ocean freight and insurance to your destination port. But you still handle import customs, duties, and delivery from port to door. Common for sea shipments.
- FCA (Free Carrier) — similar to FOB but works for air freight and inland transport. Supplier delivers to your forwarder's warehouse in China.
Common Mistake: Comparing FOB vs DDP Prices Directly
Many new importers make this mistake: they see a FOB price of $5/pc and a DDP price of $7/pc, and choose FOB because it's "cheaper." But FOB doesn't include:
- Ocean freight ($50–150/CBM for LCL)
- Import duty (0–25% of CIF value)
- VAT (15%)
- Advance income tax + advance trade VAT
- Port handling & THC charges
- Customs broker fees
- Inland delivery from Chittagong/Dhaka to your door
When you add all these up, the "cheap" FOB price often ends up costing 25–45% more than the DDP quote. Always compare total landed cost, not just the supplier price.
Bottom Line
If you're a business owner in Bangladesh who wants simplicity, predictability, and door-to-door service, DDP is almost always the right choice. The slightly higher upfront price saves you time, reduces risk, and eliminates the stress of customs clearance.
MashXpress offers DDP shipping from China to Bangladesh on both air and sea freight. Message us on WhatsApp with your product list, and we'll give you an all-in DDP price — no hidden fees, no surprises.