Standard payment terms and Incoterms for a first order
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- Issue Time
- Nov 8,2026
Short answer: The standard first order is 30% deposit by T/T with the balance against a copy of the bill of lading, on FOB terms. That combination protects both sides at the points where money and goods actually change hands. Anything outside it — full payment upfront, or DDP on a first order — deserves a specific reason.
Figure 1 — Where cost and risk transfer under each term, and the payment milestones.
The two things being negotiated
Payment terms and Incoterms are separate questions that get tangled together. Payment terms decide when money moves. Incoterms decide where risk and cost transfer. A quote can say "30/70 T/T, CIF" and still leave you unclear on who insures the cargo between the two.
Payment terms by order stage
| Stage | Typical terms | Risk sits with |
|---|---|---|
| Sample / tooling | 100% in advance, usually small | Buyer, but the exposure is small |
| First bulk order | 30% deposit, 70% against B/L copy | Shared — deposit covers materials, balance covers release |
| Repeat orders | 30/70, or net 30 after a track record | Shifts toward buyer credit |
| Large programme | Letter of credit at sight | Bank-mediated, both sides pay fees |
Why 70% against a B/L copy rather than on arrival: at that point the goods exist, are loaded, and are documented. The buyer can verify the shipment is real before releasing the balance. The seller keeps control of the original documents until payment clears, which is the only leverage that matters if a dispute arises.
Incoterms for a first order
| Term | Seller handles | When to use it |
|---|---|---|
| EXW | Nothing beyond making goods available | Only if you have a strong forwarder in China |
| FOB | Export clearance and loading at the named port | Default for first orders — you control freight and insurance |
| CIF | Freight and minimum insurance to destination port | Simple landed-cost estimate, but the cover is thin |
| DDP | Everything, including duty and final delivery | Avoid on a first order — the seller cannot absorb a classification surprise |
FOB is the sensible default because it keeps two things in your hands: the freight forwarder relationship and the import declaration. Both are where problems surface, and both are easier to solve with your own supplier than through a counterparty.
On DDP. A seller who readily agrees to DDP on a first order is either confident about the classification or pricing the risk into the unit cost. Given that classification for an acne patch can change with a claim, that risk is real — and it is usually paid for twice, once in the price and once in a delay when the entry is questioned.
Terms worth negotiating instead of price
- Balance release point — B/L copy rather than arrival is standard; accepting arrival shifts weeks of risk onto you
- Inspection before shipment — a third-party inspection at the factory, paid by you, is cheaper than a dispute after arrival
- Retained samples — written into the order, held by both sides, referenced in the specification
- Replacement clause — what happens if a batch measures outside the agreed ΔE or adhesive performance
Henso Biotech works on 30% deposit / 70% against B/L copy, FOB for first orders, with third-party inspection welcomed. ISO 13485:2016 (NQA 69136), CE Class I, FDA-registered facility, 11,500 m², 8 lines, 28.8 million patches per month.
Send your target volume and destination port, and we will quote both FOB and CIF so you can compare landed cost.