FOB (Free On Board)
FOB means the seller delivers the goods loaded onto the ship at the origin port; from that point the buyer pays freight, insurance and import costs.
Last reviewed 16 July 2026.
FOB (Free On Board) is an Incoterm for sea and inland waterway transport. The seller is responsible for getting the goods to the origin port, clearing them for export, and loading them onto the vessel the buyer has nominated. Once the goods are on board, risk and cost transfer to the buyer.
FOB is one of the most common terms in Asia–UK trade because it gives the buyer control over the main freight leg — you choose the forwarder, the routing and the insurance, and you see those costs directly instead of having them bundled into the supplier's price. It also gives you a clean goods value to declare, since freight is invoiced separately.
The trade-off is responsibility: from the moment the goods are loaded, transit risk and the cost of ocean freight, destination charges, duty and import VAT are yours to manage.
How it affects your landed cost
On FOB terms the supplier's price is the goods value at the origin port — so your landed cost is that figure plus ocean freight, insurance, UK duty and import VAT. Because those add-ons are all yours, an FOB price can look cheap next to a CIF quote until you cost the freight in. Our calculator lets you enter the FOB value and the freight separately to see the real delivered cost per unit.
Calculate your landed costFOB (Free On Board) — FAQ
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