Ex-factory (EXW)

Definition

“Ex-works” is an internationally recognized delivery condition that is enshrined in Incoterms. The term means that the seller fulfills his service by making the goods available on his premises — i.e. “ex works”. From this point on, all risks and costs for transportation, loading, export processing and insurance are transferred to the buyer.

Background and meaning

The seller assumes minimal responsibility for the “ex factory” delivery condition. All he has to do is ensure that the goods are ready while the buyer organizes all logistical processes ex works. This regulation is particularly common in business relationships between companies (B2B) that have their own logistics and transport capacities. “Ex-factory” thus signals that the buyer has complete control over the transport process, but also bears the full risk of possible delays or transport damage.

Application and challenges

Under “Ex-factory”, the buyer must:

• Pick up the goods at the factory and prepare them for transport
• Take care of packaging, loading and export
• Cover all costs, including transportation, insurance and customs

This delivery condition often offers buyers advantages in terms of flexibility and cost control, but also requires a high degree of self-organization and logistical know-how.

advantages and disadvantages

• advantages:
  
  • Cost optimization: Your own transport and logistics solutions can be more cost-effective.
  • Flexibility: The buyer decides on the mode of transport and the route.
• Disadvantages:
  
  • Assumption of risk: All risks ex factory, such as damage or delays, lie with the buyer.
  • Organizational effort: The buyer must manage all logistical steps independently.

conclusion

“Ex-works” is a delivery condition that is particularly attractive for companies with their own logistics structure. It enables a flexible and potentially cost-effective design of the transport chain, but requires careful planning and assumption of all risks by the buyer.