Incorrect Incoterms are the #2 most common export mistake. Here's which one to use for your sector and why EXW and DDP should be avoided.
Incoterms define who pays for transport, who arranges insurance, and where risk transfers. Choosing the wrong one costs African exporters thousands every year.
The recommended terms for African exporters
FOB (Free On Board) — Sea freight standard
You deliver goods on board the vessel at your local port (Mombasa, Tema, Durban). You handle export customs, buyer arranges ocean freight. Most common for coffee, cocoa, minerals.
FCA (Free Carrier) — Best for air freight and SMEs
You deliver to a carrier at a named point. Safest option — you handle what you know (export customs), buyer handles what they know (main transport).
CIF (Cost, Insurance and Freight) — Complete pricing
You pay freight + insurance to the destination port. Good for offering a landed cost to UK/EU buyers. Note: risk still transfers at origin port.
CIP (Carriage and Insurance Paid To) — Air freight with insurance
Like CIF but for all transport modes. Requires all-risks insurance cover (not just minimum).
Terms to AVOID
• EXW (Ex Works): The buyer handles YOUR export customs. You lose control. Risky for new exporters.
• DDP (Delivered Duty Paid): You pay UK/EU import duties and clear foreign customs. Maximum obligation on you.
Sector recommendations:
• Agrifood (fruits, flowers): FOB or CIF
• Textiles & manufacturing: FCA or CIP
• Heavy industrial (metals, cement): FOB or CFR
• Intra-African (AfCFTA): FCA or DAP
Always specify the exact location: 'FOB Mombasa' not just 'FOB'.