How to compare supplier quotes: FOB, MOQ, price breaks and landed cost
You have three quotes for the same product. One is the cheapest on paper. It is often not the cheapest in your warehouse.
The short answer
To compare supplier quotes fairly:
- Put every quote in one currency.
- Put every quote on one price term (for example FOB).
- Use the price break at the quantity you will buy, not the headline price.
- Check that the MOQ fits your order.
- Add packaging, freight per unit and duty to get the landed cost per unit, and compare that.
A worked example
Three suppliers quote a Bluetooth speaker. You plan to buy 3,000 units. The numbers below are an example, not market prices.
| Supplier A | Supplier B | Supplier C | |
|---|---|---|---|
| Quote | $6.20 FOB Shenzhen | ¥42.00 EXW | $6.90 FOB Ningbo |
| Price at 3,000 units | $6.20 (one price) | ¥40.00 | $6.50 |
| MOQ | 5,000 | 1,000 | 2,000 |
| Units per carton | 20 | 40 | 40 |
Step 1: The MOQ rules one out
Supplier A's MOQ is 5,000 units. You need 3,000. Supplier A's price is not real for your order unless they accept a lower MOQ. Ask, but do not compare on $6.20.
Step 2: One currency, one term
Supplier B quotes in RMB and EXW (at the factory). At an example rate of 7.1 RMB to the dollar, ¥40.00 is about $5.63. EXW does not include getting the goods to the port. If trucking and export clearance add about $0.25 per unit, B's FOB-equivalent is about $5.88.
Supplier C quotes $6.50 at your quantity, FOB.
Step 3: Freight per unit depends on the carton
Freight is paid by volume. Both B and C pack 40 units per carton, so freight per unit is about the same. If one supplier packed 20 per carton in the same carton size, its freight per unit would double. This is why you ask for carton size and units per carton at the booth.
Step 4: Landed cost
Add freight per unit and import duty to each FOB-equivalent price. With the same freight and duty rate for both, B stays cheaper than C here. With a different HTS code, packaging or carton count, the order can flip. Our landed cost guide shows the full formula.
What the headline price hides
- Price term. EXW looks cheaper than FOB because it includes less.
- MOQ per color. A 1,000 MOQ "per color" in 3 colors is 3,000 units.
- Packaging. Gift boxes, inserts and printing are often extra.
- Price validity. A quote valid for 30 days may not hold when you order in 90.
- Tooling. Custom molds are a one-time cost to spread across your units.
Do it at the booth, not in the hotel
Comparisons go wrong when the details are missing. Record the term, the price breaks, the MOQ and the carton details at the booth, next to the product photo. Our list of questions to ask suppliers covers what to ask.
Frequently asked questions
How do I compare supplier quotes with different price terms?
Convert every quote to one term, usually FOB. Add the costs an EXW quote does not include (trucking to the port, export clearance). Remove the freight and insurance a CIF quote includes. Then add your own freight and duty to get landed cost.
Should I choose the supplier with the lowest FOB price?
Not on FOB alone. Check the MOQ against your order quantity, use the price break at your quantity, and compare landed cost per unit, which includes packaging, freight per unit and duty.
What is the difference between FOB and EXW?
EXW (Ex Works) means you take the goods at the factory and pay to move them to the port. FOB (Free On Board) means the supplier delivers the goods onto the ship at the named port. An EXW price is usually lower because it includes less.
What is landed cost?
Landed cost is the full cost of a product delivered to your warehouse: the product price plus packaging, freight, insurance, import duty and fees, divided per unit.