Import Glossary

An Incoterm where the seller delivers goods on board the vessel at the origin port. The buyer owns the goods from that point and pays for ocean freight, insurance and everything after loading. The seller pays for inland delivery to the port, export clearance and loading.

An Incoterm where the seller pays for the goods, ocean freight and marine insurance to the destination port. Risk transfers to the buyer once the goods are loaded on the vessel, even though the seller arranges freight.

An Incoterm where the seller makes goods available at their own factory or warehouse. The buyer handles everything: pickup, export clearance, freight and insurance. Usually the lowest quoted price, but the most work for the buyer.

An Incoterm where the seller bears all costs and risks until goods are delivered to the buyer's door, including freight, insurance, customs duties and taxes. The most convenient for buyers, but the price usually reflects it.

A shipment that fills an entire container (20ft or 40ft) used by one buyer. Cheaper per unit than LCL for large volumes and reduces handling damage risk. FCL containers are sealed at the factory.

A shipment too small to fill a container, so it shares space with other importers' cargo in a consolidated container. You pay per cubic meter. LCL is flexible but per-unit cost is higher and transit can be slower.

A legal document issued by a carrier that proves ownership of the cargo, confirms it was received, and serves as the contract of carriage. The original B/L is required to claim goods at destination — losing it can delay release.

The air-freight equivalent of a bill of lading — a non-negotiable document covering an air shipment from origin to destination airport. Air freight is faster but more expensive per kilo than ocean.

Standardized steel boxes used for ocean freight. The most common sizes are 20ft (about 28 cubic meters usable, ~28,000 kg capacity) and 40ft (about 58 cubic meters, ~26,500 kg capacity).

Fees charged when a container stays at the port (demurrage) or is held by the buyer outside the port (detention) beyond the free time. These daily fees can quickly exceed the ocean freight cost.

The smallest quantity a supplier will accept for an order. MOQs depend on the product and factory — custom products often require 500-1,000+ units, while some stock items have MOQs of 10-50.

A factory manufactures a product to the buyer's specifications and branding. The buyer owns the design and brand; the factory just produces it. Most private-label products from China are OEM.

A factory designs and manufactures a product that the buyer can rebrand. The factory owns the design, which means faster development and lower tooling cost, but competitors may sell the same base product.

A formal request sent to suppliers asking for pricing on a specific product and quantity. A well-written RFQ includes specs, quantity, target price, packaging and delivery terms, and helps you compare offers apples-to-apples.

A product unit sent by a supplier for evaluation before mass production. Always order samples before committing — check quality, materials and packaging, and keep the sample as the reference for the production run.

A statistical sampling standard (ISO 2859) used in pre-shipment inspections. It defines how many defective units are acceptable in a sample lot — commonly AQL 2.5 for general quality and AQL 1.0 for critical defects. Inspection reports state the AQL level used.

The process of checking products against specifications, usually by a third-party inspection company at the factory before shipment. Inspectors check quantity, appearance, function, packaging and labeling.

A structured assessment of a factory's capabilities, capacity, compliance and working conditions — often done by third parties like SGS or Bureau Veritas. Audits verify the factory is real and can handle your order volume.

Alibaba's buyer-protection program: you pay Alibaba, the supplier ships, and Alibaba releases payment after you confirm the goods meet the order terms. It protects prepayment on covered orders.

Bank wire transfer, the most common payment method in China trade. Typically structured as 30% deposit before production and 70% balance against the copy of the bill of lading. T/T is fast but has no protection if the supplier defaults.

A bank-guaranteed payment arrangement: the buyer's bank promises to pay the seller when shipping documents are presented. L/Cs protect both sides for large orders but involve bank fees and strict documentation.

A third party holds payment until the buyer confirms the goods or services were delivered satisfactorily. Platform escrow (like Alibaba Trade Assurance) is the practical protection for online orders.

The international 6-digit classification of goods used by customs worldwide to determine duties and restrictions. Finding the right HS code for your product is the first step of customs clearance and duty calculation.

A tax charged by customs on imported goods, usually a percentage of the declared value (or per unit). Duty rates vary by HS code and country of origin; free trade agreements can reduce or eliminate them.

The process of submitting import documents (commercial invoice, packing list, B/L, and sometimes certificates) to customs for inspection and duty payment so the goods can be released. Usually handled by a customs broker.

A document from the seller listing the goods, unit prices, total value, HS codes and terms of sale. Customs uses it to assess duties — the declared value must be accurate and supportable.

A document detailing how goods are packed: carton dimensions, weight per carton, quantity per carton and total carton count. Customs and carriers use it to verify the shipment and calculate volumetric weight.

A document certifying where goods were manufactured, used to claim preferential tariff treatment under free trade agreements or to satisfy country-of-origin labeling rules.

A US customs requirement (10+2) — importers must file shipment data 24 hours before cargo is loaded on a vessel bound for the US. Late or missing ISF filings incur $5,000+ penalties.

A consumption tax applied to imported goods in most countries (Europe, Australia, UK, etc.), usually a percentage of the customs value plus duty. Unlike duty, VAT is often reclaimable for registered businesses.

The total cost of getting a product to your door: product price + freight + insurance + duty + taxes + handling fees. Calculating landed cost accurately is essential for pricing your product profitably.

A retail model where you sell products online without holding inventory — the supplier (often in China) ships directly to your customer. Low startup cost but thinner margins and less control over quality and shipping speed.

Products manufactured by a third-party factory but sold under your own brand name. Private label gives you brand ownership and pricing power compared to reselling generic goods.