FOB
Category: Incoterms
Definition (plain English)
Free On Board usually means the seller handles export and loading on board at the named origin port, while the buyer controls main freight, insurance, destination charges, import clearance, and inland delivery.
Why it matters commercially
FOB is often useful for comparing supplier production cost and letting buyers control freight, but it still leaves freight, insurance, duty, VAT, and arrival costs outside the supplier price.
Example
A buyer compared FOB Qingdao quotes from three factories, then tendered ocean freight separately to keep carrier choice and destination charges visible.
Common mistake
Treating FOB as delivered cost or using FOB for containerized moves without checking whether FCA would better match the real carrier handover.
Use this in CommerceKit
Landed Cost
Use tool →Freight Cost Per Unit Calculator
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