Talk:Free On Board

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I have always been under the impression (and have done the research)that free on board or freight on board is used to define where ownership of goods changes hands thus who is responsible for lost or damaged freight. And has basically nothing to do with who pays cost of freight movement. fob without destination or shipping point does really mean much at all. freight charges could be collect, prepaid or prepaid and add. —The preceding unsigned comment was added by Larryphillips (talk • contribs).

  • I agree. When I use this term, I don't use it to mean who will be paying for the shipping. I realize that may be the intent of the term, but I believe it is more widely used to signify at what point the sale is transferred to the buyer. In other words, F.O.B. tells one, if something were to happen to the product, whether he or she is responsible for it. Stiles 02:45, 24 April 2006 (UTC)

FOB Origin or FOB Destination can be followed by Freight terms: "Freight Prepaid" or "Freight Collect". "Prepaid" means the vendor pays freight and "Collect" means the buyer pays freight.

Be careful: You should use the INCOTERM CFR: Cost of Freight (Named Port), CIF - Cost of Insurance and Freight and CIP: Carriage, Insurance Paid (Named Port). FOB in International Trade is always buyers pays. Any cost to seller after delivery at port should cause the "C" class of Incoterms to be applied - not amendments - "while in muddy waters". [[[User:Khflottorp|Khflottorp]] 22:06, 24 May 2006 (UTC)]

Transfer of ownership may happen at sea, but can only happen if buyer has purchase EXW, FCA, FAS or FOB: F-class. That should clarify "ownership". Note that payment terms can differ from delivery terms and should then appear as a liability/asset in the balance sheet of seller/buyer - just as any other "Goods received but not paid for". [[[User:Khflottorp|Khflottorp]] 22:06, 24 May 2006 (UTC)]

[edit] Poorly Written

This page is hard to understand. It doesn't outwardly explain what the term means, it refers to another page and you says its similar and then says why its different... it should just define what it is outright.


[edit] FOB

is: Free On Board (Named Port of Shipment)

FOB is an INCOTERM meaning that the seller delivers when the goods pass the ship's rail at the named port of shipment. This means that the buyer has to bear all costs and risk of loss of or damage to the goods from that point. The FOB term requires the seller to clear the goods for export. The term can be used only for sea and inland waterway transport. If the parties do not intend to deliver the goods across the ship's rail the FCA term should be used. (c)Incoterm [[[User:Khflottorp|Khflottorp]] 22:06, 24 May 2006 (UTC)]


The sentence: "The term can be used only for sea and inland waterway transport." is not true...FOB can (and is constantly) used with regard to any shipment, cartage, or frieght, regardless of whether it is transported by water, and regardless of wether it crosses a border during transport.

It is true that the seller bears the responsibility of clearing the product for import, but FOB can refer to products that are not being imported as well (and is often used when refering to construction materials).

[edit] article in flux (some fragments in ecommerce section)

the last section has some incomplete thoughts. whoever knows about this stuff, please fix!

i was looking at:

"When counting inventory, merchandise in transit plays a cruc." [just when it was getting interesting...]

Michaeljwsiegel 16:25, 23 February 2007 (UTC)

"cruc" isn't a word, according to merriam-webster and dict.org. I think the word that goes here is "crux". That doesn't explain why merchandise in transit is important, but at least the sentence becomes intelligible.

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