
Sign up for consultation
What is the FOB price? This is a question that helps the parties in the shipping contract clearly understand FOB prices and delivery conditions, from which businesses can optimize costs and minimize risks. FOB prices help buyers control shipping costs and choose flexible delivery methods. Accurately calculating FOB prices not only assists in negotiating contracts but also helps businesses determine the actual costs for their export or import shipments.
FOB (Free on board) price is the price at the border gate in the seller’s country. This price includes all costs of transporting the shipment to the port, export tax and export procedure tax. Note that the FOB price does not include ocean shipping costs and ocean insurance costs.
In a commercial contract, if the delivery condition is FOB, it is necessary to clearly state: FOB + Name of loading port.
FOB price will be calculated based on the following parameters:
FOB price = Price of finished goods + cost of container lifting + cost of inland container towing + cost of opening customs declaration + cost of applying for a certificate of origin (if required by the customer) + clamping cost Maintenance + quarantine fumigation costs.
Conditions for applying FOB will be different between Incoterms versions. The following are conditions for applying FOB according to Incoterms 2020 version:
In short, FOB will apply when the goods are delivered on board the ship at the port of loading, and this condition is only suitable for sea or inland waterway transport.
When applying FOB (Free On Board) delivery conditions, the responsibilities of the parties (seller and buyer) are clearly defined, as follows:
In short:
FOB price is an important factor in determining ocean and inland waterway shipping costs, helping you optimize costs related to international deliveries. To better understand how to calculate FOB prices and applicable conditions, Long Phan would like to introduce in-depth consulting services to help you solve complex issues related to FOB in maritime and inland waterway transport. Services at Long Phan will include:
At Long Phan, we understand that every international transaction is an opportunity for business development. With a team of experienced experts in the field of maritime and inland waterway transportation, Long Phan is committed to providing you with the most optimal, fastest and most effective solutions. Contact us immediately via the hotline: 0906735386 for free advice and support in resolving issues related to FOB in maritime and inland waterway transport.
Note: The content of the articles published on the website of Long Phan Investment Consulting Company is for reference only regarding the application of legal policies. Depending on the time, subject, and amendments, supplements, and replacements of legal policies and legal documents, the consulting content may no longer be appropriate for the situation you are facing or need legal advice on. In case you need specific and in-depth advice according to each case or incident, please contact us through the methods below. With our enthusiasm and dedication, we believe that Long Phan will be a reliable solution provider for our clients.
Leave your email to receive the latest information from us
CONTACT: 0906 735 386
Copyright 2024 © Tư vấn Đầu tư Long Phan. All rights reserved.