Wholesale FOB and Buying Candles
As a retailer you need to understand what Fob means and it has more than one meaning. When you buy your candles and candle plates it is important to know that these initials are concerned with shipping. It means either Freight on Board or Free on Board. These two acronyms are similar in meaning but have distinctions. What FOB delineates is who responsible for the goods and when this responsibility is shifted to the buyer and it describes which party pays for the shipping and the loading costs.
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When and where the responsibility for the goods is transferred determines who is liable if the product is lost or damaged. In the United States and Canada the domestic shipments adhere to a meaning that is different than what is used overseas, but based on the Incotem standards just like their FOB is based on it. The interpretations are somewhat different.
There are three designations in use in the United States: The FOB shipping point means that the buyer pays for shipping and is responsible for the products as they leave the seller’s premises; it is also called FOB origin. FOB destination means that the seller is responsible for the products until they get to the buyer and the seller pays shipping. A variation is the FOB destination; freight collect meaning the shipping is collected upon arrival. Another variation is CAP, in this form the buyer uses his own carrier of choice and the buyer takes on the liability responsibility.