Ex factory vs for price

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Querist : Anonymous

Querist : Anonymous (Querist)

09 February 2012 Can any one tell me the difference between EX-factory and FOR price ?

Thx in advance:

RAMESH KUMAR VERMA

RAMESH KUMAR VERMA (Expert)
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09 February 2012 Read the link:

http://www.export911.com/e911/export/comTerm.htm

Querist : Anonymous

Querist : Anonymous (Querist)

11 February 2012 sir,

i didn't get that link.

Please give your reply here.

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
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21 July 2024 Certainly! The terms "Ex-factory" (EXW) and "FOR" are both used in the context of international trade and transportation to indicate different points in the supply chain and the responsibilities associated with the movement of goods. Here’s a breakdown of each term:

### Ex-factory (EXW) Price:

1. **Definition**: Ex-factory (EXW) refers to a pricing arrangement where the seller makes the goods available at their premises (factory, warehouse, etc.).

2. **Responsibility**: The seller's responsibility ends once the goods are made available at their premises. The buyer bears all costs and risks associated with transportation, including loading, transportation, export clearance, and insurance.

3. **Location**: The price is quoted by the seller at their premises (factory or warehouse), and it does not include transportation costs to the buyer's location.

4. **Usage**: EXW terms are often used when the buyer arranges for their own transportation and logistics and is familiar with local conditions and regulations.

### FOR (Free on Rail) Price:

1. **Definition**: FOR (Free on Rail) refers to a pricing agreement where the seller delivers the goods, cleared for export, on rail at a named railway station.

2. **Responsibility**: The seller is responsible for delivering the goods to the named railway station and for export clearance. Once the goods are delivered and placed on the rail, the buyer takes over responsibility for transportation, including insurance and any subsequent handling and costs.

3. **Location**: The price is quoted by the seller including costs up to the point of delivery at the named railway station. It does not include costs beyond that point.

4. **Usage**: FOR terms are used specifically when goods are transported by rail, and they define the point at which the seller's responsibility ends and the buyer's begins.

### Key Differences:

- **Transfer of Risk**: Under EXW, the risk transfers from seller to buyer at the seller's premises. Under FOR, the risk transfers at the named railway station.

- **Cost Coverage**: EXW does not include any costs beyond the seller's premises, while FOR includes costs up to the named railway station.

- **Transportation Method**: EXW can apply to any mode of transport, whereas FOR specifically applies to rail transport.

In summary, EX-factory (EXW) and FOR (Free on Rail) are pricing terms used in international trade to define where the seller’s responsibility ends and the buyer’s responsibility begins regarding transportation and related costs. Understanding these terms helps in negotiating contracts and managing logistics effectively.

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