The base price: EXW
EXW ("Ex-Works") price = manufacturing cost + standard packaging cost + your profit margin. Most exporters can calculate this confidently on their own — it's the pricing layers *above* EXW (FOB, CFR/CNF, CIF, or door-delivery/DDP) where mistakes actually cost money, because they require correctly accounting for freight, insurance, and destination-side charges layered on top.
Why volume (CBM) has to be calculated before you quote anything
One of the most commonly skipped steps — and one of the costliest to skip — is calculating the actual shipment volume in cubic meters (CBM) before finalizing FOB/CIF-level pricing. People tend to look at order value and quantity and feel satisfied, without checking whether that quantity actually fits cleanly into a container.
How to calculate CBM: multiply length × width × height (in centimeters) of one package, multiply that by the number of packages, then place a decimal point six digits from the right of the result. That gives you cubic meters.
Standard dry container capacities (approximate, for general cargo — separate container types exist for refrigerated, open-top, and flat-rack cargo):
- 20-foot container: ~28 CBM
- 40-foot container: ~58 CBM
- 40-foot High Cube container: ~69 CBM
Volume traps that quietly destroy your margin
Order slightly over container capacity (e.g., 60 CBM against a 58 CBM container): the excess 2 CBM won't fit. If that excess is seasonal or fashion-dependent stock (Christmas goods, winter-only items), it can become worthless by the time it ships in a later container, or the buyer may simply cancel that portion of the order — turning what looked like profit on the whole order into a net loss. If the excess has to move separately as LCL (Less than Container Load) to a different port or city, LCL cost per unit is significantly higher than FCL (Full Container Load). Better fix: ask the buyer to trim the order down to fit the container cleanly, rather than absorbing this cost after the fact.
Order noticeably under container capacity (e.g., 55 CBM in a 58 CBM container): the container ships partially empty, but you still pay close to the full per-container cost up to FOB — and if the buyer is paying ocean freight, their per-unit cost rises too. Better fix: ask the buyer to top up quantity to fill the container, rather than quietly eating an inflated per-unit freight cost.
"Shut-out" cargo — goods that don't fit and get left behind at the port when a shipment dispatches. This isn't just lost revenue on the leftover goods; it triggers a real chain of additional costs:
- A customs document amendment fee.
- Processing delay (amendments can take 1–2 days), which can cause you to miss the scheduled rail/rake booking — and missing that can mean missing the connecting vessel entirely.
- The cost of transporting the shut-out goods back to your own warehouse.
Every one of these is a direct hit to margin, stacked on top of the value of the goods that didn't ship. This is why getting the volume calculation right upfront is worth the extra time — it's cheaper than any of these downstream costs.
Multi-port / chain-store buyers: some buyers — particularly retail chain-store buyers with multiple stores across one or more countries — place one consolidated order but later split delivery across many individual ports or stores (sometimes 10–15+ destinations). Splitting one shipment into many small port-wise deliveries multiplies costs: different shipping agents, different port-of-clubbing charges, and different rates per leg, none of which are reflected in a single-shipment quote. A real documented case: shipping costs of roughly ₹1 lakh against an export value of only ₹30,000, once an order got split this way after pricing had already been agreed.
Before finalizing pricing with any buyer who might be a chain/multi-store operator, explicitly ask whether the order will ship as one consolidated shipment or get split across multiple destinations later. This single question materially changes your true logistics cost — and therefore what price you can actually afford to quote.
Bottom line
Never finalize FOB/CIF-level pricing without first locking down: (a) exact CBM volume measured against actual container capacity, and (b) whether the shipment will go out as one full container or risk being split later. Both directly determine your real logistics cost. Get either one wrong, and a profitable-looking order can turn into a loss after the fact.