What does FOB mean in shipping?

Question

I often see what does FOB mean in business and shipping discussions. Can someone explain how FOB affects buyers, sellers, and shipping responsibilities?

max · Answer

FOB means “Free on Board” in shipping and defines when responsibility and risk for goods transfer from the seller to the buyer. Under FOB terms, the seller is generally responsible for getting the goods to the specified shipping point and loading them onto the vessel. Once the goods are on board, the buyer typically assumes responsibility for the shipment, including transportation costs, insurance, and risk of loss.

Clay · Answer

"FOB" is an abbreviation for "Free on Board," which is an international shipment term that helps identify when the liability and risks involved are transferred from the seller to the buyer. When FOB is in effect, the seller takes care of everything up until the cargo is loaded into the ship.

Rojer · Answer

FOB stands for “Free on Board” in logistics and indicates when liability for the cargo passes from the seller to the buyer. In an FOB transaction, the responsibility of the seller usually includes delivery of the goods to the designated place of shipment and placing them on board the ship. As soon as the goods are loaded on board, the buyer takes charge of the shipment.

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