Picking the wrong Incoterm can quietly add 15–25% to your landed cost. DDP and FOB are the two most popular terms for China–Colombia imports — here is when each one wins.
What FOB really means Free On Board. The seller delivers the goods on board the vessel at the named port of shipment in China. From that moment, you (the buyer) own the freight, insurance, destination charges, customs and last mile.
Pros: - Full visibility and control over freight pricing. - You pick the forwarder, route and transit time. - Easier to compare quotes apples to apples.
Cons: - You handle origin documentation and any local fees beyond loading. - You assume risk from the moment cargo is on board.
What DDP really means Delivered Duty Paid. The seller delivers the goods to the named place in Colombia, with duties, VAT and customs already paid. You receive the cargo at your warehouse with no further charges.
Pros: - One single price, easy to budget. - No need to manage forwarder, broker or last mile. - Great for small or first-time importers.
Cons: - Less transparency: you cannot tell how much is freight vs duties vs margin. - Some "DDP" offers from China skip proper customs declaration — you can lose the cargo or face fines. - Harder to claim VAT credit if duties are not properly invoiced under your RUT.
Quick decision matrix - Order under USD 5,000 and you do not have a broker → DDP from a vetted operator. - Order over USD 5,000 or recurring shipments → FOB with your own forwarder. - Sensitive HS code (textiles, electronics, food) → always FOB to keep clean documentation. - Project cargo, machinery → FOB or CIF, never DDP.
Hidden costs to watch Even on FOB, ask explicitly about: THC origin and destination, BL fee, ISPS, telex release, ISF, demurrage, detention and inland trucking. Many "cheap" FOB quotes recover margin in these line items.
The right choice is rarely about price alone — it is about how much control and traceability you need over your supply chain.