What is Ex-factory terms in Imports and Exports

What is exfactory price

 The information provided here is part of Export Import Online Tutorial

In this article, I will explain about Ex Factory Price used in any business, especially in Export and Import business.  What is Ex Works cost? Is Ex-works and Ex-factory same under delivery terms in an international trade? How does Ex Works terms of delivery work?


Ex works price and Ex-factory price are on of the same term. Ex factory or Ex works term is one of the delivery terms used in exports and imports.

What is ‘Ex-factory’ terms in Imports and Exports: Ex-factory price means, the selling cost of goods from Seller's factory. All other expenses from the factory of seller to buyer's premise has to  be born by the buyer. So the responsibility of getting goods from the seller’s factory is with the buyer. Here the buyer appoints a shipping and freight forwarding company to collect goods from the seller’s factory to the buyers place including insurance of goods.

I will explain Ex-factory terms of delivery with a simple example. You are a Machinary seller situated in a place near Mumbai, India. The buyer is situated in New york. You are the seller of goods and you have contracted with the buyer and agreed to sell the goods on ex-factory price of USD 5000. Here the selling cost of goods is USD 5000 ex-factory. As I have explained, all further cost to reach the goods to the buyers place has to be met by the buyer. As per the instruction given by the buyer, freight forwarder contact his counterpart in Mumbai and arrange pick up of goods from seller’s factory. Seller delivers goods to the freight forwarder after confirming the authenticity of the freight forwarder through his buyer. All expenses of freight forwarder will be paid by the buyer. Buyer arrange to insure the goods and pay the cost of insurance. Also read - Difference between Ex works and FOB 

Here, I have explained about Ex Factory  terms used in exports and imports.  Would you like to share your experience in handling Ex works terms of delivery?   Share your understanding about Ex works terms used in international trade.   

Did you like this article about Ex works terms of delivery in Imports and Exports?  Comment below your thoughts below: 

Detailed articles about Inco Terms of Delivery under export and import of International business  have been mentioned in  separate category – INCO TERMS – in this web site.  You can click here to read.





The above information is a part of Import Export Training online


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Am: hello! i'd like to ask regarding "ex-factory date" term. This is the payment term clause in one of our invoices: "20th day of the 4th month after the ex-factory date" * the invoice month is May and * the bill of lading month is June. So what would be the ex-factory date? is it the invoice month or bill of lading month? Thanks

kumar: As per my knowledge, the party should mention specifically whether date of invoice or date of bill of lading.

Rajiv : Ex work sale is understood . What remains confusing , is that the seller will raise an export invoice in USD, on ex works basis . THey will also collect payment in forex from their buyer as per their business contract. Whose invoice will be used for clearing customs Pls clarify. Also as the factory owner has raised an export invoice in USD, what documents will be needed for the factory to prove that export of goods has been done . It is possible the new york buyer further sells the goods to some one in Australia.What happens in this case. Can the new york buyer become the exporter from India for shipment by air cargo or sea cargo. I look to hear from you ,

Admin: Hi Rajiv, As you know, the exporter (seller) invoice is used for import customs clearance. Bill of Lading and Export Promotion copy of Shipping Bill (EP copy) are treated as document proof for export. Regarding triangular shipment, please read my other articles about the same.

Kumar: This article is of great help to me being first time merchant exporter. We have an export order with EXW terms which contain 18-20 lots of machinery/pipes/valves to be procured by me from different factories of chennai/B'lore/Mumbai/Nasik. The buyer will clear 90% payment EXW basis against inspection. Can we treat each of my vendor premise as a point of sale as the inspection is arranged at differant places? Is there any documatation haziles?

Sachin Shingane: i am resonantly join in export industry and your information is really helpful thank you so much ..sachin

Sathisha Poojary: Dear Sir I need clarification on ex-works, getting Certificate of Origin etc., from concerned authority is whose responsible seller or buyers responsible Thanks in advance Sathisha Poojary

adam: who pays taxes and duties on ex works?

Robel hossain: Good evening, actually I want to be clear that is there any difference between Ex-work and Ex- factory?

Ajeesh: The details explained about EX-WORKS under inco terms is excellent.

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