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What is FOB Destination?

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FOB Destination

What is FOB Destination? 

Freight On Board (FOB) Destination is a term that describes a situation when the seller retains title and control of his sold goods. The buyer takes delivery of his purchased goods being shipped to him by the supplier, once the goods arrive at the buyer’s receiving dock. In this situation, the seller pays and bears the freight charges and still owns the goods while they are being transported to the buyer. The buyer only claims the goods as his once they arrive at the ‘destination.’

FOB Destination Simplified

The seller owns the goods in transit and is responsible for freight charges

The seller assists with the settlement of claims and is responsible for full-replacement of damaged items

Title passes when the goods reach their destination- the seller retains title and control until delivered to and accepted by the buyer


FOB Add-on Terms

These terms may be added to or included in the freight invoice, bill of lading, or other forms of shipping documentation. They are as follows:

What is FOB Destination, Freight Prepaid, and Allowed? 

- In this case, the title passes to buyer when goods arrive at buyer's location or dock

- The seller pays and bears freight charges

- The seller owns goods while in transit

- The seller files claims, when needed

What is FOB Destination, Freight Prepaid, and Added? 

- The title passes to the buyer when goods arrive at buyer's location

- The seller pays freight and adds to the buyer’s invoice

- The buyer bears all freight charges

- The seller owns freight goods while in transit

- The seller files claims when needed

What is FOB Destination, Freight Collect? 

- The title passes to the buyer when goods arrive at buyer's location

- The buyer pays freight charges when the goods are received

- The buyer bears freight charges

- The seller owns goods while in transit

- The seller files claims when needed

What is FOB Destination, Freight Collect, and Allowed? 

- The title passes to the buyer when the goods arrive at the buyer’s location

- The buyer pays for the freight shipment

- The buyer collects freight charges from the supplier by deducting the shipment amount from the invoice

- The buyer collects freight charges from the supplier by deducting the amount from the invoice

- The seller files claims when needed

   

  

  

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