The following quick guide will explain the basics of trading on ‘EXW without pickup’ shipping terms. EXW without pickup is a slightly modified version of the original Incoterm Ex Works (EXW).
Within international commerce a number of trading terms have been defined and are recognized by most countries worldwide. These are also known as the Incoterms and have been a great help to importers and exporters involved in international trade. The reason is that Incoterms limit misunderstandings by specifying exactly who is responsible for each step of the international transport process.
One of the most common Incoterms is EXW. EXW simply means that the buyer will be responsible for any cost associated with the transport all the way from the shipper’s door or address at origin until delivery at destination.
Now, in many cases we found that the local collection, i.e. transport or trucking at origin, can actually be cheaper acquired by the seller than it can by the buyer. Therefore, we decided to modify the original EXW shipping term a bit.
EXW without pickup is an interpretation of the international trading term Ex Works (or EXW), and like every other Incoterm, they both specify when the risk, ownership and cost of any product is transferred from the seller to the buyer.
For both terms, ownership is transferred at the address of the seller, however, the transport cost for EXW without pickup does not transfer until the goods have reached the port, airport or terminal of loading in origin.
Quick guide to 'EXW without pickup'
In this video Transporteca's Founder and CEO, Morten Laerkholm, explains the basics of trading on 'EXW without pickup' shipping terms.
So why is it that the seller can often buy the local transport cheaper than you can as the importer? It is actually quite simple: If you buy a transport solution where a freight forwarder has to go and collect your cargo at your supplier’s factory, they often need to send a truck to collect your consignment alone. They may not have other customers who have bought products from that same factory.
However, if the seller has to send a truck to the port or airport, they can usually consolidate your cargo with other customers’ cargo, that are also going out on that week’s ship or that day’s aircraft. Thereby, the seller gets economy of scale, which means that the transport cost on a unit level becomes less – and that is why we offer the modified trading term EXW without pickup on Transporteca.
When you search for EXW without pickup, the transport price you see will include everything on EXW terms except the local transport at origin. This will often give you a lower overall transport cost.
If you want to know more about EXW without pickup, read our post on the subject here. For more information on the different Incoterms, check this link. You are also very welcome to contact us on email, chat and phone, if you have any further questions.