When quoting an international buyer, understanding the difference between FOB (Free On Board) and CIF (Cost, Insurance and Freight) is important.
FOB pricing generally covers the goods and the seller’s obligations up to the agreed point of shipment, while CIF pricing includes the cost of the goods, insurance and freight to the destination port.
Use the FOB vs CIF Calculator below to estimate the difference and understand how freight and insurance affect your export price.
Know Your Export Profit Before You Ship — plan export pricing with confidence.
Free ToolProduct & Pre-shipment
Ocean / Air & Banking
Commercial
Comparison uses costs from the Export Profit tab. Click Calculate to refresh.
Seller pays: product, packing, loading, export customs. Buyer pays: main freight & insurance.
Seller pays: FOB costs + freight + insurance to destination port. Risk still transfers on loading at origin.
Uses cost structure from Export Profit tab to find minimum prices.
Runs a full order analysis from Export Profit inputs. Fill that tab and Calculate.
Educational checklist only — requirements vary by product, country and payment terms.
Free On Board — seller delivers goods on board at the origin port. Buyer arranges and pays main carriage and insurance.
Cost, Insurance and Freight — seller pays cost, minimum insurance and freight to destination port. Risk still passes on loading at origin.
When you invoice in foreign currency, INR realization moves with the rate. A small FX shift can change profit materially on large orders.
Ignoring bank charges, underestimating freight, forgetting inland haulage, and confusing margin with markup on export quotes.
Revenue in INR (invoice FC × exchange rate + incentives) minus all export-related costs.
Typically product, packing, inland transport to port, loading and export clearance — not main ocean/air freight.
FOB elements plus freight and insurance to the named destination port.
No. Under standard Incoterms, risk transfers when goods are loaded on board at origin, even on CIF.
Buyer preference and currency risk matter. USD is common; manage FX exposure deliberately.
Use a conservative rate for quotes, or the bank’s expected realization rate including spreads.
Incentives (where eligible) increase effective revenue — confirm scheme eligibility before counting them.
LC confirmation, negotiation, and remittance charges can erode thin margins on small orders.
It depends on product value density. If freight is a large share of cost, review packing, mode and routing.
Yes — it is designed to surface full cost before you commit to a price.
No. Use live freight/insurance quotes; this tool organizes them into profit analysis.
Sum all costs up to FOB point; that is the minimum FOB in INR before profit.
IEC, invoice, packing list and shipping bill are core; others depend on product and destination.
Many costs are semi-fixed; higher quantity often improves profit per unit if price holds.
Yes, if you pay agents or overseas commission on the order.
Varies by sector; track contribution after all variable export costs, not only factory margin.
Faster payment terms, advance, forward cover, or pricing clauses linked to rate bands.
Neither is universally better; it depends on who controls freight rates and buyer preference.
Export of goods is generally zero-rated under GST with conditions; confirm current law for your case.
Yes — it maps real cost heads used in export costing and Incoterms discussions.
Disclaimer: This calculator provides estimated export profitability for planning and educational purposes only. Actual profitability depends on commercial terms, Incoterms, logistics charges, exchange rates, taxes, banking costs, insurance, customs procedures and contractual obligations.
FOB and CIF are Incoterms used in international trade to define responsibilities, costs and risk between the seller and buyer.
Under FOB, the seller generally handles the costs and responsibilities required to deliver the goods on board the vessel at the agreed port of shipment.
Under CIF, the seller generally arranges and pays for the cost of the goods, insurance and freight to the named destination port.
The exact responsibilities and transfer of risk depend on the applicable Incoterm and contract terms. Always confirm the agreed Incoterm and named place or port in your sales contract.
A simplified calculation is:
CIF Price = FOB Value + Freight + Insurance
The actual calculation can depend on the transaction, insurance method, freight quotation and contract terms.
An exporter may receive a buyer enquiry asking for either an FOB or CIF quotation.
Comparing both can help you understand:
This is particularly useful when freight rates change significantly between destinations.
Before sending a quotation, exporters should also confirm the correct Incoterm, named place or port, currency, payment terms and other commercial conditions with the buyer.
The calculator provides an estimate for comparison and planning. Always use the actual freight and insurance quotations applicable to your shipment when preparing a final commercial quotation.
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Calculated your FOB or CIF price? The next step is finding the right international buyer.
With Volza, you can research actual import-export shipment data to discover potential buyers, suppliers, products and markets.
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