Commercial
Incoterms Cost Calculator
Compare two Incoterms 2020 rules segment by segment - who pays export clearance, freight, insurance, duty - and see where risk turns over against the cost.
Result
FOB vs DAP
FOB puts 2 of the 7 cost segments on the seller; DAP puts 4. DAP is the larger obligation on the seller, so it should be the larger price for the same goods.
| Cost segment | FOB | DAP |
|---|---|---|
| Export clearance | Seller | Seller |
| Loading at origin | Seller | Seller |
| Main carriage (freight) | Buyer | Seller |
| Cargo insurance | Buyer | Seller |
| Unloading at destination | Buyer | Buyer |
| Import clearance | Buyer | Buyer |
| Import duty and taxes | Buyer | Buyer |
Highlighted rows are where the two rules differ.
FOB - Free On Boardsea only
Risk passes: When the goods are on board the vessel at the port of shipment.
Sea-only, and yet the most over-used term in the world for containerised freight. A container is handed to a carrier at a terminal days before it sails, so FOB describes a moment that no longer exists - use FCA.
DAP - Delivered At Place
Risk passes: At the named destination, on the arriving vehicle, ready for unloading.
Risk and cost travel together here - the seller carries both until the goods arrive. The gap to watch is unloading: the buyer is responsible for it, and if the seller’s carrier waits, waiting time is a charge that appears after the price was agreed.
Risk and cost move together in the D-rules and are separate in the C-rules. Under FOB risk passes at: when the goods are on board the vessel at the port of shipment. Under DAP: at the named destination, on the arriving vehicle, ready for unloading.
Before you agree the term
- FOB is a sea and inland-waterway rule only. It should not be used for containerised or multimodal shipments, where the handover moment it describes does not exist.
- They differ on 2 of the 7 segments: main carriage (freight), cargo insurance. Price the two quotes on the same segment before comparing the totals.
All eleven rules
- EXW - Ex Worksany mode
At the seller’s premises, before anything is loaded.
- FCA - Free Carrierany mode
When the goods are handed to the carrier the buyer nominated, at the named place.
- FAS - Free Alongside Shipsea / inland waterway
When the goods are placed alongside the vessel at the port of shipment.
- FOB - Free On Boardsea / inland waterway
When the goods are on board the vessel at the port of shipment.
- CFR - Cost and Freightsea / inland waterway
When the goods are on board the vessel at the port of shipment - not at the destination.
- CIF - Cost, Insurance and Freightsea / inland waterway
When the goods are on board the vessel at the port of shipment.
- CPT - Carriage Paid Toany mode
When the goods are handed to the first carrier - which may be a long way before the destination.
- CIP - Carriage and Insurance Paid Toany mode
When the goods are handed to the first carrier.
- DAP - Delivered At Placeany mode
At the named destination, on the arriving vehicle, ready for unloading.
- DPU - Delivered at Place Unloadedany mode
When the goods are unloaded at the named destination.
- DDP - Delivered Duty Paidany mode
At the named destination, cleared for import and duties paid.
The rule definitions follow ICC Incoterms 2020 and describe who bears each cost and where risk passes. They do not price anything, and the named place in a rule changes its meaning - always read the term with the place attached.
What you provide
- Two Incoterms rules
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