The export price list. A price without an Incoterm isn't a price.

The price list is the first document a foreign buyer compares with someone else's. And the comparison is almost always lost by whoever wrote the lowest number without saying what it refers to.

This piece is part of the guide to export operations for the small food producer and covers the fourth step, the one where the negotiation takes numerical shape.

The template, to download

A price without an Incoterm and without the place can't be compared, and the buyer chooses the price they can compare. The sheet asks for the costs you already know, once, and from them calculates EXW, FCA, FOB, DAP and DDP for each product. The file is in Italian.

File	What it contains	Link
Export price listExcel, three sheets	The typical shipment over which costs are spread, the price list with the five quotations per product, and the sheet explaining what each term means.	listino-export-foglio.xlsx

The files are free. There is no form in front of them, we don't ask for an address and we receive no notification when someone downloads them. The sheet adds up what you write into it: it doesn't know the duties of the country of arrival and doesn't guess them, and the tax side is left out on purpose.

Why the Italian price list doesn't hold up abroad

The domestic price list works in Italy because all its implicit assumptions are shared. Whoever reads it already knows who pays for transport, which VAT applies, what the normal payment times in the sector are, and which formats exist on the market.

Abroad, none of those assumptions survives. The foreign buyer doesn't know them and won't ask: they will make their own assumptions, and make them in their own favour. Then they will compare the result with a competing offer built explicitly, and yours will look approximate even when the product is better.

The buyer doesn't choose the lowest price. They choose the price they can compare.

The Incoterms you really need

Incoterms are the delivery terms codified by the International Chamber of Commerce. In the 2020 version, in force since 1 January 2020, there are eleven. A small food producer, in practice, meets five.

Here the term serves to build the price. The operational question that comes straight after, that is, who pays for transport, who clears export, who clears import and who pays the duties, has a single table per term in Incoterms: who pays what.

Term	Where your job ends	When it makes sense
EXWEx Works	Goods made available at your plant. Loading, transport, export customs and risks pass to the buyer.	When the buyer already has their own freight forwarder in Italy. Convenient in appearance, with the two consequences described below.
FCAFree Carrier	Delivery to the carrier nominated by the buyer, at the agreed place. The export formalities stay with you.	When you want to keep control of the exit procedures without taking on international transport.
FOBFree On Board	Goods loaded on board the vessel at the agreed port of shipment.	Born for sea shipments, and still the term many non-EU buyers ask for out of habit.
DAPDelivered At Place	Goods delivered at the place of destination, ready for unloading. Import clearance stays with the buyer.	When you want to quote a delivered price without taking on the duties and taxes of the country of arrival.
DDPDelivered Duty Paid	All-inclusive to the customer's door, import duties and taxes included.	To be avoided until you know the destination country's costs precisely. It is the term that exposes the seller most.

The term on its own is never enough: it must always come with the place. FCA written without stating where delivery takes place leaves open exactly the question the Incoterm was meant to settle.

EXW looks like the convenient choice

Almost all small producers quote EXW for their first export, and the reason is understandable: the goods go out of the gate and the problem becomes someone else's. The consequences, though, are two, and it pays to know them before choosing.

The first concerns comparison. An EXW price is the lowest you can show, and for that very reason the least comparable: the buyer has to add transport, formalities and risks to understand how much they are really paying you. If the competitor quotes delivered, your lower number can turn out, at the end of the sums, to be higher.

The second concerns the exit procedures. With EXW the export customs formalities are in the hands of the buyer or their freight forwarder, while you may need the documentation proving the goods left the territory of the Union. Recovering that document from someone who has no interest in providing it is a real practical difficulty.

The body that publishes the rules has spoken on this. ICC Academy writes that EXW «is most suitable for domestic trade», and that sellers are «strongly encouraged to consider using FCA instead of EXW where the goods are crossing a border». In plain words: EXW was born for domestic trade, and FCA is the term that changes little in commercial practice, since the goods still leave from your yard, and leaves you in the position of exporter.

The minimum order, derived from the pallet

The minimum order is almost always chosen as a round number, and almost always defended badly, because whoever chose it can't explain where it comes from. The right question is another: below what quantity does the shipment cost disproportionately relative to the value of the goods?

That point is found by looking at how the product actually stacks.

• Pieces per carton, and weight of the full carton.
• Cartons per layer, and layers per pallet.
• How many pallets fit into the transport unit your buyer will use.

A minimum aligned with the pallet or half pallet has a physical reason the buyer recognises at once, because it is the same logic their warehouse works by. A minimum chosen by feel is perceived as a commercial barrier, and attacked as such in negotiation. The same palletisation data is also needed in the technical sheet in English, where it is among the fields most often forgotten.

What the price list should contain

Six elements. If one is missing, the document can't be compared and will produce a round of emails to clarify what could have been written.

• The delivery term with the place, for example FCA followed by the name of the plant or the carrier.
• The currency, stated explicitly even when it seems obvious.
• Format, pieces per carton and weight, because the buyer must be able to calculate the cost per unit sold and not just per carton.
• The minimum order, stated per product and per shipment, which are two different things.
• The validity, with an expiry date. A price list with no expiry comes back eight months later with your costs from back then.
• The payment terms, including any advance required on the first supply, which for a new buyer is a normal and accepted request.

The price list still shouldn't be sent in the first reply to a generic enquiry: three questions come first, and that is the subject of how to reply to a foreign importer's email. The full sums of what it costs to get this far are in what the first export order really costs.

When the price lists become five

With one market and two products the price list is kept up to date from memory. The problem comes when there is a price list for Europe, one for the United States, one for a private label, each with its own currency and delivery term.

From that moment the risk shifts from getting a price wrong to sending the old version. It always happens the same way, by retrieving the attachment from the last email instead of from the right folder, and the buyer doesn't notice until the order.

That is the point where the approved version must sit in a single place, with a visible date, and go out from there to whoever asks for it. It is the work done by the system for texts and sales materials, with the constraint written in Ethics: documents are prepared automatically, but the version that reaches a buyer is confirmed by a person.

Questions and answers