A quotation from Thailand, a quotation from Korea and a quotation from India arrive for the same product, priced in three different currencies, on three different Incoterms, and with three different assumptions about who claims what trade preference at the Vietnamese border. The lowest ex-factory figure is not necessarily the lowest landed cost, and the only way to find out which actually is is to rebuild all three on the same basis before comparing a single number.
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Why an ex-factory price from three countries cannot be compared directly
An ex-factory or FOB price only tells you what the factory charges to make and load the goods — it says nothing about freight, duty, currency conversion, payment terms or inspection cost, and those five items can move the landed cost by more than the gap between the two quoted prices.
Each of these five items behaves differently depending on the origin country, which is exactly why a like-for-like comparison across countries takes more normalisation than a comparison between two suppliers in the same country:
| Item | Why it varies by origin country |
|---|---|
| Incoterm and named place | A factory-gate price in one country and a port-loaded price in another bundle different amounts of work into the number |
| Freight | Distance, route and whether the shipment is LCL or consolidated with other suppliers’ cargo all change the freight line |
| Import duty at the Vietnamese border | Depends entirely on whether a trade agreement between Vietnam and the origin country applies, and whether the supplier can issue a matching certificate of origin |
| Currency | Each quotation may be priced in the supplier’s home currency, in US dollars, or in another currency entirely |
| Payment terms and inspection cost | Different suppliers, and different countries’ banking norms, default to different terms and different inspection arrangements |
The line that changes most by country: import duty and the FTA question
Whether a preferential duty rate is available at the Vietnamese border depends on which trade agreement, if any, covers the origin country — and this is not the same answer for every Asian country, so it needs checking per quotation, not assumed from the last country you sourced from.
Vietnam’s ASEAN partners generally qualify under the ASEAN Trade in Goods Agreement; several Northeast and South Asian countries qualify under their own separate agreements, each with its own certificate-of-origin form and its own rules of origin; and at least one major sourcing country in this comparison has no preferential agreement with Vietnam at all, so the standard duty rate applies regardless of documentation.
| Origin country (example) | Preferential agreement available | What determines whether it applies |
|---|---|---|
| An ASEAN member | ASEAN Trade in Goods Agreement (and generally RCEP) | Rules of origin under the relevant agreement, and a matching certificate of origin |
| South Korea | VKFTA, AKFTA and RCEP all run in parallel | Which agreement’s rules of origin the goods meet, and which certificate the supplier can issue — see sourcing from South Korea |
| India | ASEAN–India Trade in Goods Agreement (AIFTA); India is not in RCEP | Whether the goods meet AIFTA’s rules of origin, and whether the certificate is issued through an agency authorised for AIFTA — see sourcing from India |
| Taiwan | No Vietnam–Taiwan agreement, and Taiwan is outside RCEP | Nothing — the standard duty rate applies regardless of documentation — see sourcing from Taiwan |
Ask every supplier, regardless of country, two questions before comparing price: which trade agreement (if any) it believes applies, and which agency will issue the certificate of origin. A quotation that assumes a preferential rate the goods do not actually qualify for is not cheaper — it is a duty bill that has not been added yet.
Checked against Vietnam’s National Trade Repository FTA listings on 25 September 2026.
💬 Not sure which of your quotations can actually claim a preferential rate at the border? Send us the origin country and the HS code for each.
The worksheet: rebuilding each quotation on the same basis
Fill in every row for every quotation before you subtract one total from another — a blank cell is a question to send the supplier, and a guessed cell is a decision made on the supplier’s behalf.
| Line | Supplier A | Supplier B | Supplier C |
|---|---|---|---|
| Origin country | |||
| Currency, and the rate and date used to convert | |||
| Incoterm and named place, exactly as quoted | |||
| Ex-works or FOB price (Supplier A price, Supplier B price, Supplier C price) | |||
| Freight to the same named place of delivery | |||
| Trade agreement claimed (if any) and certificate of origin type | |||
| Import duty rate applied at the Vietnamese border (preferential or standard) | |||
| Payment terms (deposit, balance, and when each is due) | |||
| Inspection cost, and who arranges it | |||
| Landed cost at the same named place, same currency |
Two rules make this worksheet work. First, convert every currency at one stated rate on one stated date — not each supplier’s own quoted exchange rate, which can differ by several points from a published central rate on the same day. Second, treat the import duty row as provisional until the certificate of origin is actually in hand; a supplier’s belief that a preferential rate applies is not the same as Vietnamese customs accepting the certificate.
Payment terms and inspection cost: the two lines buyers forget to normalise
A lower price with a larger deposit, or a lower price with no third-party inspection built in, is not automatically the better deal — both change the buyer’s actual cash position and risk, and neither shows up in the headline price.
Payment terms differ by country as much as by supplier: some markets default to a larger upfront deposit than others, and letters of credit are more or less standard depending on where the factory is used to trading. Put the full payment schedule — not just “30% deposit” — on the worksheet for every quotation, including when the balance is due relative to shipment.
Inspection cost follows a similar pattern. A quotation that excludes third-party pre-shipment inspection looks cheaper than one that includes it, until the buyer adds the inspection back in as a separate line for a fair comparison. Whichever supplier’s quotation excludes it, decide before ordering whether an inspection is being arranged and by whom, and put that decision — and its cost — on the worksheet rather than leaving it as an unstated assumption for one supplier and a quoted line for another.
After the worksheet: what a surviving price gap tells you
Once every line above is normalised to the same basis, a price gap that remains is a real difference in cost, scope or risk — and where it comes from is usually one of currency timing, an unconfirmed duty assumption, or a genuinely different landed cost structure between the two countries.
If the gap traces back to the import duty row, go back and confirm the trade agreement and certificate of origin claim directly with the supplier before ordering — an assumed preferential rate that turns out not to apply changes the comparison after the fact, not before it. If the gap survives that check, it is a genuine cost difference between sourcing from the two countries for this specific product, and a fair basis for the decision.
Where suppliers across more than one of these countries end up in the shortlist, consolidating their shipments into a single onward container is often the next efficiency to look at — see consolidating shipments from several Asian suppliers for how that works and what it does to each supplier’s origin proof. And for finding and checking the suppliers in the first place, see finding factories in ASEAN and Taiwan.
💬 Ready to put your Asian supplier quotations on one landed-cost sheet? Contact us about sourcing from Asia.
Frequently asked questions
1. Is the lowest ex-factory or FOB price always the lowest landed cost?
Not necessarily. Freight, import duty, currency conversion, payment terms and inspection cost can move the landed cost by more than the gap between two quoted ex-factory prices. Rebuild each quotation on the same basis before comparing.
2. How do I know if a supplier’s country qualifies for a preferential duty rate into Vietnam?
It depends on the specific trade agreement between Vietnam and that country, and whether the goods meet that agreement’s rules of origin. Ask the supplier which agreement it believes applies and which agency will issue the certificate of origin, then confirm rather than assume.
3. What exchange rate should I use to compare quotations in different currencies?
One stated rate, on one stated date, applied to every quotation equally — not each supplier’s own quoted rate, which can vary supplier to supplier even on the same day.
4. Should I add inspection cost to a quotation that does not include it?
Yes, if you intend to inspect before shipment. A quotation that excludes inspection is not cheaper than one that includes it; it has simply left the cost off the sheet for you to add back.
5. What if the price gap between two countries survives every line of normalisation?
Then it is a genuine difference between the two sourcing options — worth understanding (a different process, a different scale of operation, a different cost base) before you decide, but not a sign either quotation is wrong.
Sources: Vietnam National Trade Repository, FTA listings for ASEAN, VKFTA, AKFTA, RCEP and AIFTA. Checked on 25 September 2026.