Ex-Work price means, the selling cost of goods at seller’s factory. All other expenses from the factory of seller to buyer’s place have to be borne by the buyer. So the responsibility of getting goods from the seller’s factory is with the buyer. Here the buyer appoints a shipping and freight forwarding company to collect goods from the seller’s factory to the buyers place including insurance of goods.
I will explain Ex-Work terms of delivery with a simple example. You are a Machinery seller situated in a place near Mumbai, India. The buyer is situated in New York. You are the seller of goods and you have contracted with the buyer and agreed to sell the goods on ex-factory price of USD 5000. Here the selling cost of goods is USD 5000 ex-factory. As I have explained, all further cost to reach the goods to the buyers place has to be met by the buyer. As per the instruction given by the buyer, freight forwarder contact his counterpart in Mumbai and arranges to pick up goods from seller’s factory. Seller delivers goods to freight forwarder after confirming the authenticity of the freight forwarder through his buyer. All expenses of freight forwarder will be paid by the buyer. Buyer arrange to insure the goods and pay the cost of insurance.
