Start with the scope, not the bottom line
A written quote is a scope document first. The same headline price can cover different goods, volumes, delivery points, payment schedules and paperwork. Procurement comparison guidance puts volumes, currencies, Incoterms, tooling and NRE charges, payment terms and line items on the normalization list before price is compared. That is the practical test: if two quotes do not share those variables, the lower number does not yet mean the lower cost.
Missing line items are a common place for a low quote to hide. So the first pass is not who is cheaper. It is whether each quote describes the same job.
Incoterms tell you which costs are inside the number
The named Incoterms rule and the named place are part of the price definition. Security-related obligations sit in A4 on carriage and A7 on export/import clearance, with related costs in A9/B9.
DAP and DDP are a useful test because their difference is easy to miss. Under DAP, the buyer unloads the goods and handles import formalities at the buyer's own cost, risk and responsibility; B3(a) puts the risk of loss or damage during import clearance on the buyer. Under DDP, the seller handles import customs formalities and is ultimately responsible for import clearance, while the buyer must assist with documents or information required by import customs authorities. Some import customs authorities require the local importer to clear goods, which can make DDP unusable and point back to DAP.
That is why a quote that says only DAP or DDP without a place is not yet a comparable price. Ask for the rule, the named place, and the cost lines that sit on each side. For CIF or CIP, ask which insurance cover and insured value basis the price assumes. If a quote uses FCA for sea carriage, that documentary arrangement belongs in writing.
Payment terms are part of the price
Payment terms change the cash-flow risk, so they belong in the comparison. The trade.gov guide lists five primary payment methods for international transactions and says the method should be chosen during or before contract negotiations to balance payment risk with the buyer's needs. Cash-in-advance avoids credit risk for the exporter because payment is received before ownership transfers; wire transfers and credit cards are common options, and escrow services are becoming an option for small export transactions. Advance payment is the least attractive option for the buyer because it creates unfavorable cash flow and the buyer bears the risk that goods may not be sent.
Open account means goods are shipped and delivered before payment is due, typically 30, 60 or 90 days in international sales; it is advantageous for the importer's cash flow but high risk for the exporter. Letters of credit are one of the payment methods covered by the same trade guide.
For comparison, write down the deposit, the balance trigger, any milestone payments, the currency, the FX basis, late-payment terms and cancellation terms exactly as the supplier states them. If the quote is silent on any of those, treat that silence as an open item, not as a zero cost. The point is not to demand one payment structure from every supplier. It is to compare the same structure, or to price the difference.
Normalize every quote to one basis
Quote comparison is normalization: restate every quote at the same volumes, one currency rate and one Incoterms basis so the comparison is total landed cost. Separate tooling and NRE charges, then amortize them over realistic lifetime volume; price the difference in payment terms and lead time; and check line-item completeness. A piece price alone can reverse the ranking. In one example, Supplier A quotes $4.20 per casting with $85,000 tooling and Supplier B quotes $4.65 with $20,000 tooling; at 100,000 lifetime units, A totals $505,000 and B $485,000, while at 250,000 units the answer flips back to A.
Incoterms can create the same trap. An overseas quote of $11.10 EXW can look below a domestic $12.20 DDP offer, but adding $0.74 freight, $0.33 duty and export packaging brings the overseas part to $12.17, a dead heat before six weeks of ocean transit and the inventory it forces. A separate example makes the same point with bulk paper: an EXW quote $50 per metric ton below a CIF quote becomes $25 per metric ton more expensive once ocean freight adds $75 per metric ton.
Insurance is the line buyers most often miss when comparing Incoterms quotes. State the coverage scope and insured value assumption for every quote before comparing totals. Also log the lane, dates, coverage and FX assumptions used in the comparison. A normalized sheet is not a claim that one supplier is best. It is a record of what was compared and what was added to make the numbers mean the same thing.
What a quote should say before you sign a purchase order
At minimum, the written quote should identify the goods and specification, quantity, unit price, currency, Incoterms rule and named place, delivery lead time, validity period, payment schedule and every exclusion or assumption. It should also separate tooling, NRE, packaging, testing, documentation, samples and freight where those items affect the total. If a line is missing, ask for a written clarification or amended quote that adds it. Keep the original quote, the clarification and the final version together, and make the purchase order refer to the final scope.
This is a record-keeping discipline, not a guarantee that a dispute will be avoided. It gives both sides one version of what was priced. When a supplier says a cost is included, have that sentence added to the quote. When a supplier says a cost is excluded, have the exclusion listed by name.
Offer, acceptance and the limits of this source set
The legal effect of a quote depends on the wording and the transaction. Bromley Council's consumer-contract guidance says that advertising goods, displaying a price list, or showing goods on a website or in a brochure is usually an invitation to treat; the consumer then makes an offer, and a contract is made if and when the trader accepts. That guidance is about consumer contracts, so it should not be stretched into a complete rule for business-to-business quotations.
The Sale of Goods Act 1979 addresses sale-of-goods contracts. It provides that, unless otherwise agreed, delivery of the goods and payment of the price are concurrent conditions, and it allows the seller to reserve the right of disposal until conditions are fulfilled. The sources supplied here do not establish a single EU-wide list of mandatory quotation contents, nor do they provide a U.S. CBP commercial-invoice checklist or HTS classification rule. Those points need jurisdiction-specific material before they are written as requirements.
For EU imports, the sources do establish the DAP/DDP allocation: under DAP the buyer handles and pays for import clearance and bears the risk during that process, while under DDP the seller handles import clearance and remains responsible, subject to local rules that may require the local importer to clear. That is the part of the landed-cost question this source set can answer. VAT rates, duty rates and invoice data fields are outside it.
A short clarification message that gets results
Ask for the missing scope in one written message. Use short numbered questions, each tied to a line in the quote. A workable set is:
- State the Incoterms rule and named place for each line.
- Confirm whether freight, insurance, export clearance, import clearance, duties and unloading are included or excluded.
- List packaging, testing, documentation, samples and tooling as separate lines or confirm they are included.
- State the payment schedule, currency, FX basis and validity period.
- List every exclusion and assumption that affects price, lead time or risk.
If the supplier answers in an email, ask for a revised quote that incorporates the answers. Compare only the revised versions. That keeps the audit trail clean and stops a verbal promise from becoming the only record of a cost.
Questions buyers ask before comparing quotes
Are EXW and DDP quotes directly comparable?
No. They place different costs and responsibilities on each side. Restate both on one Incoterms basis and one volume before comparing.
Under DAP, who handles import clearance?
The buyer does, at the buyer's own cost, risk and responsibility; the buyer also bears the risk of loss or damage during import clearance under B3(a).
Under DDP, can the seller always clear the goods?
Not always. Some import customs authorities require the local importer to carry out import clearance, and DDP cannot be used in those cases.
Does a written quote always bind the supplier?
Not automatically. In the consumer guidance reviewed here, advertising and price displays are usually an invitation to treat, and a contract is made when the trader accepts the consumer's offer. For business transactions, the wording of the quote and the acceptance matter, and this source set does not provide a universal rule.
What if the quote has no exclusions section?
Ask for a written amendment that lists exclusions and assumptions, then compare the amended quote. Keep the request, the reply and the final quote with the purchase order.
What about UCP 600 and letters of credit?
Letters of credit are one of the payment methods in the trade guide.