Incoterms decide who pays for what
Factory quotes are written on an Incoterms rule, the International Chamber of Commerce terms that split costs and risk between seller and buyer. The same product can look cheap or expensive depending on which rule is quoted.
| Term | Seller covers | Buyer covers |
|---|---|---|
| EXW (Ex Works) | Makes goods available at the factory. | Loading, export clearance, all transport, import clearance, duties. |
| FOB (Free On Board) | Export clearance and delivery onto the vessel at the named port. | Ocean freight, insurance, import clearance, duties, inland delivery. |
| CIF (Cost, Insurance and Freight) | Freight and minimum insurance to the destination port. | Destination charges, import clearance, duties, inland delivery. Risk passes at loading. |
| DDP (Delivered Duty Paid) | Everything to your door, including import duties. | Unloading. You still need to confirm who is the importer of record. |
FOB is the most common starting point for ocean shipments. EXW quotes look lowest but push the most work onto you. DDP quotes look simplest, but confirm how duties are being declared, because the importer of record carries legal responsibility for the entry.
Ocean freight: LCL or FCL
LCL (less than container load) shares a container with other shippers and is priced by volume or weight. It suits smaller orders but adds handling at consolidation and deconsolidation facilities, which adds fees and time. FCL (full container load) books a whole container at a flat rate per container, so the cost per unit drops as you fill it. Socket wire spools and cased bulbs are bulky for their value, so cubic volume, not weight, usually drives the freight bill. Freight rates move with the market; ask a forwarder for a current quote rather than relying on any published figure.
Customs, duties and fees
Goods entering the US are classified under the Harmonized Tariff Schedule of the United States (HTSUS), published by the US International Trade Commission. The classification determines the duty rate. Lighting products can fall under different headings depending on what exactly they are: a bulb, a lighting set, wire, or a fitting. On top of the general rate, additional duties have applied to many goods of Chinese origin in recent years, and those measures have changed repeatedly.
Do not guess the rate
This site does not publish duty rates or tariff numbers, because they depend on exact classification and current trade policy. Confirm classification and the rates in force on your entry date with a licensed customs broker and the official tariff schedule before you place the order.
Beyond duties, expect these cost categories on an ocean import:
- Customs brokerage: the broker's fee for preparing and filing the entry.
- Customs bond: required for formal entries; single-entry or continuous.
- Importer Security Filing (ISF): required for ocean cargo before loading; late filing can bring penalties.
- Government fees: such as the merchandise processing fee and, for ocean cargo, the harbor maintenance fee, both calculated on the entry.
- Destination charges: terminal handling, documentation, and for LCL, deconsolidation.
- Inland delivery: drayage or trucking from port to warehouse, plus any chassis or storage fees if pickup is delayed.
- Cargo insurance, if not included in the Incoterms rule you bought on.
Costs outside freight and customs
- Samples and their courier shipping.
- Third-party pre-shipment inspection.
- Bank wire fees and currency conversion on deposits and balances.
- Storage from arrival until use, often most of a year for seasonal goods.
- Cost of capital: cash paid months before the product earns anything.
- Defect allowance: bulbs or sockets that fail on arrival or during the first season, with no quick replacement path.
Landed-cost worksheet
Put every cost into one per-unit figure so it can be compared with a US price that already includes delivery.
Everything except the factory price and the duty is largely a fixed amount per shipment, so the per-unit share falls as the order grows. The table shows only arithmetic: how much each $1,000 of fixed shipment cost adds per bulb at different order sizes, compared with the real US case price.
| Bulbs in shipment | Per bulb, per $1,000 of fixed cost | Share of the US case price ($0.638) |
|---|---|---|
| 1,000 | $1.000 | 156.7% |
| 5,000 | $0.200 | 31.3% |
| 10,000 | $0.100 | 15.7% |
| 25,000 | $0.040 | 6.3% |
| 50,000 | $0.020 | 3.1% |
| 100,000 | $0.010 | 1.6% |
Read it this way: if your shipment carries, say, several thousand dollars of freight, brokerage, inspection and fees, a small order of a few thousand bulbs spends a large part of the US price on overhead before the factory price and duty are even counted. At container-scale quantities the overhead per bulb becomes small, and the factory price and duty rate decide the outcome.
The comparison side
On September 27, 2026, the US side of the comparison was C9 LED bulbs at $319.00 per 500-bulb case ($0.638 per bulb) from Christmas Light Supplier, with free shipping on every order, no minimum and no fees, so that number is already a delivered price. Bought that way there is no deposit, no customs entry, no storage and no forecasting: you buy when the job is sold. Run the worksheet with real quotes for your shipment and compare it against that delivered figure.