Freight on board

Answer 1

Free on Board (FOB - U.S. Domestic Use)

Shipped under a rate that includes costs of delivery to and the loading onto a carrier at a specified point.

- FOB Freight Allowed: The same as FOB named inland carrier, except the buyer pays the transportation charge and the seller reduces the invoice by a like amount.

- FOB Freight Prepaid: The same as FOB named inland carrier, except the seller pays the freight charges of the inland carrier.

- FOB Named Point of Exportation: Seller is responsible for the cost of placing the goods at a named point of exportation. Some European buyers use this form when they actually mean FOB vessel.

- FOB Vessel: Seller is responsible for goods and preparation of export documentation until actually placed aboard the vessel.

Freight on board (F.O.B.) is a trade term meaning the party (usually the shipper/vendor/supplier/manufacturer) at the origin port is responsible for delivery freight to the receiving location as agreed and indicated in the trade term.

For example, FOB Buffalo, NY vs. FOB New York, NY.

FOB Buffalo, NY means shipper is only responsible for moving goods to a Buffalo, NY receiving location. It could also be shipper's factory location. The buyer is suppose to arrange all freight moves from Buffalo to its destination.

FOB New York, NY means vendor is responsible to move goods to a terminal/ a rail ramp/or a receiving warehouse in New York, NY. Then buyer takes over the responsibility of the freight till it gets to the destination.