FOB (shipping)
FOB is an initialism which pertains to the shipping of goods. Depending on specific usage, it may stand for Free On Board or Freight On Board. FOB specifies which party (buyer or seller) pays for which shipment and loading costs, and/or where responsibility for the goods is transferred. The last distinction is important for determining liability for goods lost or damaged in transit from the seller to the buyer.
Precise meaning and usage of "FOB" can vary significantly. International shipments typically use "FOB" as defined by the Incoterm standards, where it always stands for "Free On Board". Domestic shipments within the US or Canada often use a different meaning, specific to North America, which is inconsistent with the Incoterm standards.
North American FOB usage corresponds to Incoterms approximately as follows:
| North America | Incoterm |
|---|---|
| FOB shipping point or FOB shipping point, freight collect | FCA shipping point |
| FOB shipping point, freight prepaid | CPT destination |
| FOB destination or FOB destination, freight prepaid | DAP destination |
| FOB destination, freight collect | No Incoterm equivalent |
Read more about FOB (shipping): Incoterm, North America, Accounting and Auditing
Famous quotes containing the word fob:
“If you want to use a cliché you must take full responsibility for it yourself and not try to fob it off on anon., or on society.”
—Lewis Thomas (b. 1913)