If you sell on Amazon, TikTok Shop or your own store, this is the question that lands in our inbox nearly every week: “DDP or DDU — which one should I pick?” It is a fair question, and it deserves a straight answer instead of a page of Incoterms.
Short version: under DDP the seller’s side clears the goods and pays duty; under DDU — now usually written DAP — the goods arrive cleared for export, and the buyer clears and pays at destination. Price, risk and who you call when something goes wrong all follow from that one difference.
Who does what, on one line
| DDP | DDU / DAP | |
|---|---|---|
| Customs entry | our desk at destination | you or your broker |
| Duty and import tax | included in the price | paid by you at entry |
| Risk until | your door or the warehouse dock | the named place, not yet cleared |
| Typical use | first FBA shipment, DTC parcels | replenishment with your own importer number |
First leg: most sellers start with DDP
On your first shipment you usually have no importer number, no broker at destination and no receiving contact. DDP takes all three off your desk: we book the space, declare export, clear import, pay duty and deliver against the appointment. You get one invoice and one person to ask.
One honest caveat: a DDP price carries an assumed duty rate, and that reserve is worth checking once you know your HS code. We wrote about where that money sits in the four lines inside a DDP quote. When you ship often enough to hold your own importer number, DDU usually becomes the cheaper answer — the break-even arithmetic shows where the line falls.
Overseas warehouse: delivered to the door, or cleared by you?
If you fulfil from an overseas warehouse, there are two ways in. DDP runs all the way to the warehouse dock on one price. DDU stops at the port or airport: you clear, then arrange the truck and the receiving appointment yourself.
Which is better depends on how often you replenish. Many SKUs, small top-ups every few weeks: DDU plus a warehouse that clears and books for you is more flexible, because you are not re-pricing duty on every parcel. One or two big containers a year: DDP keeps the moving parts in one place.
Whatever you choose, confirm three things before the container leaves: the receiving appointment, the carton labels and the weight limit per pallet. Warehouses reject shipments over labels and appointments far more often than over freight cost.
Returns: the part that quietly decides your margin
- Back to China: freight and duty rarely justify it, unless the goods are high value and repairable.
- Back to the overseas warehouse: relabel, inspect, restock or resell. This is what most sellers do — confirm first that your warehouse accepts returns and how it charges for them.
- Dispose locally: for low-value items, abandoning or donating on the spot is cheaper than moving them twice.
One detail that catches people out: import duty paid under DDP is usually not recoverable when the goods come back, because the importer of record was not you. If returns are a normal part of your business, price that in from the first shipment.
Three things to check before you book
- Does the quote include destination charges and the receiving appointment, or only the freight?
- Which HS code and which duty rate sit behind the DDP price?
- When something goes wrong, who calls you first — our operations desk, or your own broker?
So, which one?
No term is always cheaper; one term is calmer at the stage you are in. Put the risk on the side that can carry it for the first shipment, get the file running, then compare prices with real numbers in hand. If you are not sure yet, send us the cargo details and we will quote both ways, side by side, so the difference is visible rather than argued about.