FOB origin
FOB origin, or Free On Board origin, is a shipping term that indicates the buyer takes ownership of the goods at the seller’s location. This means that the seller is responsible for all costs and risks associated with transporting the goods to the buyer’s location.
For example, if a company in Sweden purchases goods from a supplier in China on an FOB origin basis, the supplier is responsible for delivering the goods to the port in China and loading them onto the ship. Once the goods are on board, the buyer assumes ownership and is responsible for all costs and risks associated with transporting the goods to Sweden.
It is important for buyers and sellers to clearly define the terms of the FOB origin agreement to avoid any misunderstandings or disputes. This includes specifying the exact location where ownership transfers, as well as outlining who is responsible for various costs such as transportation, insurance, and customs duties.
FOB origin is just one of many international shipping terms that companies use to manage the logistics of transporting goods across borders. By understanding the implications of FOB origin, businesses can ensure smooth and efficient delivery of their goods.
Examples of FOB origin terms:
- FOB Factory: The buyer assumes ownership of the goods once they leave the seller’s factory.
- FOB Shipping Point: The buyer assumes ownership of the goods once they are loaded onto the transportation vessel.
- FOB Destination: The seller is responsible for delivering the goods to the buyer’s location.
For more information on FOB origin, you can visit Wikipedia.