What is free-on-board (FOB)?
Free-on-board (FOB) is a term used in international trade to indicate the point at which ownership and responsibility for goods transfer from the seller to the buyer. FOB typically has two variations: FOB shipping point and FOB destination.
FOB shipping point means that the buyer assumes ownership and responsibility for the goods at the shipping point, while FOB Destination means that the seller retains ownership and responsibility until the goods reach the buyer’s specified final destination.
What is free-on-board origin?
Free-on-board (FOB) origin (or shipping point) is a shipping term that indicates the point at which ownership and responsibility for goods transfer from the seller to the buyer. In FOB terms, the seller is responsible for the goods and bears the shipping costs, also known as freight charges or freight costs, until the goods are loaded onto the transportation vehicle at the specified origin point. The seller pays the shipping costs, which may include transportation costs, and the buyer assumes ownership and responsibility for the goods once they are loaded. FOB origin is commonly used in the shipping industry to define the terms of a transaction and clarify the division of costs and responsibilities between the buyer and seller.
What is free-on-board destination?
Free-on-board (FOB) destination is a shipping term where the seller is responsible for the goods and bears the shipping costs, including transportation costs until the goods reach the designated destination. The seller has ownership and responsibility for the goods until they are delivered to the buyer’s specified location, such as the buyer’s loading dock or destination port. FOB destination is an important shipping term in the supply chain and international trade, as it determines the point at which the transfer of ownership and responsibility occurs.
