F.O.B. (Free on Board)

F.O.B. (Free on Board) is a shipping term that defines who is responsible for goods at different stages of transport. When goods are sold "F.O.B. shipping point," the buyer assumes responsibility once the items are loaded onto the transport vehicle. Conversely, "F.O.B. destination" means the seller maintains responsibility until the goods reach the buyer's location. This term helps clarify liability, shipping costs, and risk, ensuring both parties understand their obligations in the transaction. In essence, it indicates who pays for and owns the goods during shipping.