FOB Definition - Business Communication Words

 

Free On Board. Applies to shipped orders, and the party following the FOB is the one that pays nothing for the shipping, usually either shipper, or customer. Though it does vary noticeably in exact meaning and practice. It's wise to get a clear explanation as to how it applies.

 

"The widgets’ invoices to our customers are FOB shipper."

 

"When questions arise from FOB on invoices, the business office usually redirects them to the warehouse."

 

"Our supply shipments run about 50/50 FOB shipper/receiver."

 

"There is controversy over the FOB rate on some crude oil shipments."


 

 

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