An acronym for “freight on board” or “free on board” depending on who you ask. This term indicates who pays the transportation costs. An item that is priced at a particular FOB point (usually a city, state and zip code) indicates the cost of that item at that location. This is also is the point where a buyer takes responsibility for an item.
For example, if an item is priced, FOB Kent, WA 98032, the cost of that item reflects the price of the product at Centra Foods’ warehouse in Kent, WA not including any additional shipping costs.