FOB vs CIF for China Furniture: What Does Each Price Cover?

What does an FOB furniture price actually include?

FOB covers everything up to the moment your furniture is loaded on board at a named Chinese port. The factory pays inland haulage from the workshop, export clearance, and the origin terminal charges. Ocean freight, insurance, and every cost after loading are on your account. That is why FOB is the default for buyers who already run a freight forwarder: you see the real shipping bill as its own line rather than folded into a single bundled figure you cannot take apart.

What does CIF add on top of FOB?

CIF adds exactly two things — ocean freight to a named destination port, and a marine insurance policy. It does not add import clearance, duty or VAT, destination terminal handling, or the truck to your warehouse. It also does not change where risk transfers, which still happens on board in China. The freight sits inside one number you cannot audit, so a CIF quote is convenient but opaque. The long-form FOB vs CIF cost breakdown walks through the line items in full.

Does a CIF price mean my furniture is properly insured?

No — under Incoterms 2020 a CIF seller only has to buy minimum cover, Institute Cargo Clauses (C). That is a named-perils policy built around major casualty events, not the everyday handling damage furniture actually suffers: crushed corners, scuffed veneer, marked upholstery. Treat the seller’s policy as a floor rather than real protection, and price your own wider cover on top. Sound export packing does more for furniture than a thin certificate does.

Why do FOB and CIF fit furniture containers badly?

Both rules were written for cargo loaded over a ship’s rail, not for containers. Your furniture is handed to the terminal days before it is lifted on board, so the delivery point written into the contract and the moment you lose physical control stop lining up. The ICC’s own Incoterms guidance is that FCA, CPT and CIP suit containerized cargo better. Most China furniture trade still quotes FOB, so read the Incoterms comparison and make sure your cover starts at the terminal.

What do both terms leave out entirely?

Neither FOB nor CIF gets your furniture to your door. Import clearance, duty and VAT, destination terminal handling, demurrage if the box sits too long, and inland delivery all fall outside both. Comparing an FOB price against a CIF price and stopping there means comparing two incomplete numbers. The figure that decides whether the order is profitable is landed cost, calculated all the way to your warehouse.

So which should you book for a furniture order?

Compare CIF against FOB plus your own freight quote — never against the FOB figure on its own. CIF is a reasonable choice for a first or small shipment when you have no forwarder yet. Once volume is regular, controlling the booking usually wins: you choose the carrier, the sailing, and the level of cover. Furniture cubes out long before it weighs out, so how well the container is filled moves your per-unit cost more than tonnage ever will — the FCL and LCL guide shows where that line falls.