Certified Materials and Resource Professional Practice

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What does FOB stand for in shipping terms?

Free of Burden

Freight on Board

FOB stands for Freight on Board, which is a key shipping term that designates when the responsibility and ownership of the goods transfer from the seller to the buyer. Under FOB, once the goods are loaded onto the shipping vessel at the designated point, the seller's obligations end, and any subsequent risks and costs associated with the shipment fall on the buyer. This term clarifies which party is liable for shipping fees, insurance, and any damages that may occur during transport.

The significance of understanding FOB lies in negotiations and logistics management, particularly when determining who is responsible for shipping costs and risks during the transport of goods. Therefore, knowing that FOB indicates "Freight on Board" is essential for anyone involved in shipping and receiving products.

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Freely Offered Bargain

Field of Bulk

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