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Earlier, there were about 13 such related terms in the Incoterms but the amended Incoterm 2010has reduced it to 11. These terms are globally recognized easing the business transactions which take place cross-board.Among all the terms framed by the International Chamber of Commerce, the FOB incoterms are the one which gets widely used. FOB indicates freight on board or free on board . The term requires a deep understanding and knowledge.

In relation to international transactions, FOB Incoterms 2010 are mainly origin-based. This indicates that when the shipment is marked FOB origin, the risk and cost of the goods are transferred to the buyer from the seller at the origin point itself. As soon as the goods get loaded, it is the responsibility of the purchaser to safely Columbia Coats Mens transport the goods to the perfect destination country. In case of other transactions, however, FOB destination is also applicable.

It must be noted that it is technically incorrect. This mistake often gets committed as companies involved in international transactions tend to ignore the other terms of the incoterm. However, this confusing habit is not at all supported and you must know the correct significance of the Fob term.Initially, FOB was associated with the selling of goods in bulk amounts. Decades ago, there were no containers available for shipping the goods and thus people used any ship for carrying the load.