What is DDP
(Delivered Duty Paid)?
Effective Date: December 2024

DDP, or Delivered Duty Paid, is an Incoterm® where the seller manages the entire shipment, including export, transport, clearance, and all duties.

The seller completes export formalities, transport, import clearance, delivery, and covers all duties and taxes under DDP.

International transport (Air or Sea freight).
Import clearance in the destination country.
Payment of all import duties and taxes (VAT/GST).
Final delivery to the buyer's doorstep.

With DDP, the seller covers all transport and duty costs and may need to meet local tax requirements, like VAT registration or acting as the Importer of Record.

What the customer sees at checkout is what they pay — nothing more. All the customs forms, shipping arrangements, and duties? That's on the seller.

Think of it as the exact flip side of EXW, where buyers are left to sort out delivery themselves. Not exactly a great experience when you're shopping online from another country, right?

DDP changes that. Buying from a store halfway across the world starts to feel normal, like grabbing something from a local shop. No extra steps, no surprises at the door.

2. So what's the big deal with DDP for online sellers?

Why bother with it when DAP exists?

People actually finish buying

Nobody enjoys unexpected fees at checkout. When a bargain suddenly costs more, it's a terrible feeling. Your customers feel the same.

Baymard Institute actually dug into this and found that unexpected costs are among the top cart-killers. People just... leave.

DDP eliminates those surprises. What's on the screen is what they pay, nothing added later. No customs officer ringing the doorbell or confusing paperwork.

One retailer ran the numbers after switching over: 15% fewer abandoned carts. Fifteen percent! And all they did was change the way they structure shipping. That's not a small win.

They'll come back for more

There's something else going on here, too. When a purchase just works, with no weird fees at the door, no customs forms to figure out, no "what the hell is this charge" moment, people notice. Maybe not consciously. But somewhere in their brain, your store gets filed under "easy."

And easy wins every time. That's the kind of experience that turns a one-time buyer into someone who keeps coming back.

When buying feels easy, customers return. You build repeat business by not annoying them, not just with flashy marketing.

Protection from Return Risks

Now think about what happens with DAP when something goes wrong. Customer sees unexpected duties at the door, refuses the package, and guess who's stuck with the bill? You. Return shipping, customs fees, the whole mess lands back in your lap.

The math is brutal, too. A single refused order can eat through the profit you made on seven sales that went through. Seven. That's not a typo.

With DDP, this headache just does not exist. Everything's paid upfront, so there's no reason for anyone to turn down the package.

And there's a practical bonus on the logistics side. When you use DDP, freight forwarders can bundle your shipments together, which means customs does not take forever, packages move faster, and your money is not stuck in transit limbo. It's the behind-the-scenes stuff nobody talks about, but it makes a real difference to how smoothly things run.

3. How DDP actually plays out

Let's walk through a real scenario.

Say there's a UK brand selling Bluetooth speakers. Someone in the US places an order. Here's the process:

Sale (S): The customer pays $100 on Shopify for the speaker. This covers the product, $10 for shipping, and about $5 for US duties, either shown as a separate line or included in the price.
Pickup (P): The freight forwarder picks up the speaker in London. They also handle all the necessary export paperwork to ship the product out of the UK.
Transit (T): The shipment travels from London to New York (JFK Airport) by air or sea, depending on the arrangement.
Import (I): Upon arrival in New York, the forwarder handles customs clearance, submits the required documents, and pays all duties and taxes required by US regulations. The customer is not contacted or involved in this step.
Last-mile delivery (L): This is the final stretch. A local carrier — UPS, FedEx, USPS, whoever serves that area — picks up the package and delivers it to the customer's doorstep.
Want an easy way to remember all five steps? Just think S-P-T-I-L. Sounds a bit like "spill," right? Stick that in your head, and you've got the whole flow down whenever you need it.

Questions often come up about DDP details. Let's address some common ones:

A: In most cases, that's the seller. But here's a shortcut a lot of people don't know about — many DDP logistics companies will actually act as the Importer of Record for you. They use their own legal entity to handle customs clearance, which takes a massive headache off your plate.

Q: Is DDP more expensive than DAP (formerly DDU)?

A: Yes, DDP costs more upfront due to duties and taxes, but it can save money by reducing refused packages, negative reviews, and admin costs.

Q: Can I use DDP for Amazon FBA?

Yes. If you're selling via Amazon FBA, ensure all duties and taxes are prepaid—act now to prevent delivery headaches and keep your store running smoothly.

DDP Shipping to USA
DDP Shipping to Canada
DDP Shipping to Brazil
DDP Shipping to Amazon FBA