If you are new to importing batteries from China, the jargon can be overwhelming. Suppliers throw around terms like EXW, FOB, MOQ, OEM and LC as if everyone knows what they mean. This glossary explains every term you will encounter, in plain language, with real examples.
Pricing Terms
EXW (Ex Works)
The buyer is responsible for everything from the supplier's factory door: loading, transport, export clearance, shipping, insurance and import clearance. The supplier only makes the goods available at their warehouse.
Example: "10 kWh LiFePO₄ battery, EXW Shenzhen, $800/unit" means you pay $800 per unit and arrange all shipping from Shenzhen.
When to use: When you have your own freight forwarder and want control over shipping. Most experienced importers prefer EXW.
FOB (Free On Board)
The supplier is responsible for getting the goods to the port and loading them onto the ship. From that point, the buyer takes over. FOB includes export clearance and port handling at origin.
Example: "FOB Shenzhen Yantian, $820/unit" means the supplier delivers to Yantian port and loads it on your ship. You handle ocean freight and everything after.
When to use: When you want the supplier to handle local transport and export clearance, but you control ocean freight.
CIF (Cost, Insurance, Freight)
The supplier handles everything up to the destination port: ocean freight and insurance included. You handle import clearance and delivery to your warehouse.
When to use: When you want a simpler process and are OK paying a premium for the supplier to arrange shipping.
DDP (Delivered Duty Paid)
The supplier handles absolutely everything: production, shipping, insurance, import clearance, duties and delivery to your door. You just receive the goods.
When to use: When you want zero logistics hassle and are willing to pay the highest price for convenience. Rare for battery imports due to customs complexity.
| Term | Supplier Handles | Buyer Handles | Price Level |
|---|---|---|---|
| EXW | Manufacturing only | Everything else | Lowest |
| FOB | + Local transport, export clearance | Ocean freight + after | Low |
| CIF | + Ocean freight, insurance | Import clearance + after | Medium |
| DDP | Everything | Nothing | Highest |
Order Terms
MOQ (Minimum Order Quantity)
The smallest quantity a supplier will accept for an order. Below MOQ, the supplier will not produce or the price is significantly higher.
Example: "MOQ: 50 units" means you must order at least 50 units. Ordering 10 units either gets refused or gets a much higher per-unit price.
Tip: Always ask about MOQ tiers. Many suppliers offer price breaks at 50, 100, 500 and 1000 units.
Lead Time
The time from order confirmation to goods ready for shipment. Typically 15-45 days for battery products, depending on quantity and customisation.
Always confirm lead time in writing and build buffer into your planning. "3 weeks" often means 4-5 weeks in practice.
Branding Terms
OEM (Original Equipment Manufacturer)
The supplier manufactures the product with your brand name, logo and model numbers instead of their own. The product looks like it came from your factory.
Example: You order 100 portable power stations with your "Acme Energy" logo and model number "AE-1000" instead of the supplier's brand.
When to use: When you want to build your own brand and prevent customers from finding the original supplier.
ODM (Original Design Manufacturer)
The supplier designs and manufactures the product based on your specifications. You can customise the appearance, features and packaging, not just the branding.
When to use: When you want a unique product design, not just rebranded stock. Higher MOQ and cost than OEM.
White Label
The supplier's existing product with only your branding applied (logo on the product, custom packaging). No changes to the product itself. Lowest MOQ and cost for customisation.
OEM is the sweet spot for most distributors: your brand on a proven product, with reasonable MOQs and no design risk. SH Energy offers full OEM on all product lines.
Payment Terms
T/T (Telegraphic Transfer / Bank Wire)
The most common payment method for China imports. Typical structure:
- 30% deposit when order is confirmed
- 70% balance when goods are ready and before shipment (or against copy of B/L)
L/C (Letter of Credit)
A bank guarantee that protects both buyer and seller. The buyer's bank guarantees payment when the supplier presents the required shipping documents. More secure but more expensive (bank fees) and slower.
When to use: For large orders ($50,000+) where trust has not yet been established.
PayPal / Trade Assurance
For sample orders and small quantities. PayPal offers buyer protection but high fees. Alibaba Trade Assurance provides some protection for orders placed through the platform.
| Method | Typical Use | Buyer Protection | Fees |
|---|---|---|---|
| T/T 30/70 | Standard orders | Low (trust-based) | Low |
| L/C | Large orders, new suppliers | High (bank guarantee) | Medium |
| PayPal | Samples, small orders | High (dispute resolution) | High (4-5%) |
| Trade Assurance | Alibaba orders | Medium (platform mediation) | Low |
Shipping Terms
HS Code (Harmonized System Code)
A standardised code that classifies the product for customs. Determines duty rates and documentation requirements. For LiFePO₄ batteries: 8507.60.00.
B/L (Bill of Lading)
The shipping document that serves as: (1) a receipt for the goods, (2) evidence of the contract of carriage, and (3) a document of title (who owns the goods). You need the B/L to claim your goods at the destination port.
UN38.3
A mandatory safety test for shipping lithium batteries. Without a valid UN38.3 test report, no carrier (air or sea) will transport the batteries. See our article on Iraq customs clearance for details.
MSDS (Material Safety Data Sheet)
A document detailing the chemical composition, hazards and safe handling procedures for the battery. Required by most customs authorities and shipping lines.
COO (Certificate of Origin)
A document certifying the country where the product was manufactured. May be required for preferential duty rates or import restrictions. Must be chambered (legalised by the chamber of commerce).
Quality Terms
QC (Quality Control)
The process of inspecting goods before shipment. Options:
- Supplier QC: The supplier's own inspection (free, but not independent)
- Third-party QC: An independent inspection company (SGS, TUV, etc.) checks the goods before shipment (~$200-500 per inspection)
- Self-inspection: You or your agent visits the factory to inspect (best but requires travel)
AQL (Acceptable Quality Limit)
The maximum percentage of defective units that is acceptable in a batch. Common AQL levels:
- AQL 2.5: Up to 2.5% defects acceptable (standard consumer products)
- AQL 1.5: Up to 1.5% defects acceptable (higher quality)
- AQL 1.0: Up to 1.0% defects acceptable (premium products)
SH Energy Terms Summary
When you work with SH Energy, here is what to expect:
- Pricing: EXW Shenzhen, 30-day validity
- MOQ: 10 units for samples, 50+ for OEM branding
- Lead time: 15-25 days for standard, 25-35 days for OEM
- Payment: T/T 30% deposit, 70% before shipment
- Branding: Full OEM with your logo, model numbers and packaging
- Documentation: Complete package (UN38.3, MSDS, CE, IEC, COO, commercial invoice, packing list)
- QC: 100% individual cell testing, full pack test before shipment
- Warranty: 5 years (LiFePO₄ batteries), 3-5 years (inverters depending on IP rating)
Bottom Line
Understanding these terms is essential for any battery importer. Print this glossary, keep it handy, and never be afraid to ask your supplier to clarify terms you do not understand. A good supplier will happily explain — a bad one will be annoyed that you asked.
Contact SH Energy to discuss your import needs. We speak your language.
Interested? Let's talk.
Contact us for pricing, samples and OEM options. We ship to Iraq, UAE, Oman and across the GCC.