What Does Fob Mean, What Is Fob Origin And Destination?

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If you have ever been associated with any kind of shipment consignments in your life, then you might have come across the acronym fob before. These days, we ship different kinds of products to a number of places. Whenever we carry out these shipping consignments, we might often notice the acronym fob printed in the shipping documents. Hence, this term does have immense importance in this sector. The people who have not heard of this term before might wonder what does fob mean. Some might think that it is an internet slang like lol, rofl, etc. But, it is not an internet acronym that we come across everyday. Rather, it is solely applied in the shipping sector. The acronym is a bit complicated, and it has a number of vital aspects, as well. Here, we will be discussing in detail about fob and its importance. Then, we will be looking at two vital terms that are closely related to fob. These include fob origin, as well as fob destination. So, if you are completely unaware of these terms, then this discussion will satiate your curiosity to a great extent. It will help you a lot whenever you deal with any kind of shipment consignments in the near future.

What Does Fob Mean?

When it comes to the fullform of this particular acronym, different people might come up with different guesses. However, most of these guesses might be incorrect. This is a very popular acronym that is used for different types of shipping consignments. It stands for free on board.These include both domestic, as well as international shipments and the fob gives an idea regarding the following details.

  • As we all know, the shipping orders and contracts indicate the important details about the time, as well as place of delivery.

  • In addition to that, it also includes the payment details, as well as the particular instance during which the risk of loss undergoes a shift from the seller to the buyer.

  • You will also be able to get details regarding which party is liable to pay the costs associated with freight and insurance. In fact, the transactions between the vendor and client determine the fob terms in the purchase order.

  • It must be noted that the fob status does not indicate ownership. In fact, ownership is solely denoted in the bill of sale agreement which is issued between the buyer and seller.

  • The fob simply indicates the particular party who is liable to take the responsibility when it comes to the shipment. This responsibility can be assigned to the people at the Origin or at the Destination. Origin denotes the place where the shipment process began. Likewise, Destination denotes the place where the shipment consignment ends.

  • It is also better if both the parties involved in the shipping consignment develop a firm understanding of free on board policies to guarantee a smooth and hassle free transfer of goods from the vendor’s end to the client.

What Do You Understand By Fob Origin?

We have discussed what does fob mean. As mentioned earlier, this acronym has two divisions. One is fob origin and the other one is fob destination. Firstly, let’s take a look at fob origin.

  • Fob origin is also known as fob shipping point. This acronym indicates the fact that the buyer will be liable for receiving the title for the goods that they have purchased once the shipment begins.

  • This further indicates that the responsibility of the seller ends once the shipment items are packed and loaded inside a carrier.

  • Once the items are placed inside a carrier, the buyer must take the responsibility of ensuring that the concerned goods reach the destination by the stated time. They will also be responsible for any damage that occurs during the shipment process.

  • If any damage occurs during the transportation process, the buyer will be obliged to assume the entire responsibility. Thus, they cannot ask the supplier to compensate in any manner for the losses or damages incurred. In other words, the supplier’s role is over once he securely brings the shipment items to the carrier.

What Do You Mean By Fob Destination?

By now, the readers might have got a clear idea regarding what does fob mean, and what is fob origin. Now, there is another term which comes under the jurisdiction of fob, that is fob destination. This is the exact opposite of fob origin.

  • In this case, the responsibility or title of ownership is transferred primarily at the buyer’s loading dock. This can also take place at the post office box, or office building.

  • So, as the shipment items reach the intended location that has been specified by the buyer during the agreement, the ownership title of the goods is transferred from the seller to the buyer.

  • This further indicates that the seller legally owns the goods and is hence, responsible for the safety of the goods during the entire process of shipping.

  • In the case of the fob destination, freight prepaid and allowed, the seller is obliged to pay, as well as bear the freight charges.

  • In the case of fob destination, freight prepaid and added, the seller is obliged to pay the necessary charges like the former category. But here, he will bill these charges to the customer thereafter.


The question, what does fob mean, is actually very important and it is sub categorized into different important aspects. However, it must be noted that a particular type of fob might be superseded according to the requirements of the customers. This occurs when he or she wishes to override the stated terms with an arrangement that is decided solely by them. They can make the necessary arrangements for picking up the concerned goods directly from the seller’s location. During such circumstances, the responsible staff at the billing office must have a proper idea regarding the new delivery terms. This will help in carrying out the shipping consignment smoothly.

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