Incoterms define exactly where responsibility — and cost — transfers from seller to buyer during a shipment. Three terms come up most often in China trade: EXW, FOB, and CIF.
EXW (Ex Works) means the seller's responsibility ends at their own factory or warehouse door. The buyer arranges and pays for everything from that point forward, including export clearance — which makes EXW the term that puts the most logistics coordination on the buyer's side.
FOB (Free On Board) shifts the seller's responsibility to the point where goods are loaded onto the vessel at the origin port. The seller handles export clearance and inland transport to port; the buyer takes over from the ship's rail onward, including ocean freight and import clearance.
CIF (Cost, Insurance, and Freight) goes further still: the seller pays for the ocean freight and insurance to the destination port, though risk still technically transfers once goods are loaded at origin. Which term makes sense depends on how much control each party wants over the shipping process — EXW gives the buyer full control (and full responsibility); CIF hands more of that to the seller. Neither is inherently better; the right choice depends on who is better positioned to manage the logistics involved.