Home – New Forums Logistics I want cheaper shipping! :( Reply To: I want cheaper shipping! :(

Cat – GLC
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Chris H, post: 183563 wrote:
One thing to spell out carefully is what both companies mean by FOB.
FOB can mean on board the ship or ex-works (the factory’s front door)

I would ask the supplier for an Ex-Works FOB price for the goods.
Then ask your Freight Forwarder for an FIS price including shipping, clearance and local delivery.

Just to clear things up and I am trying not to make things more confusing.

Ex-works and FOB are two completely different incoterms.

Ex-works means from the shippers door.

FOB (Free on Board) is Free on Board to whichever port your supplier nominates, which is usually listed on the invoice. E.g. FOB Shanghai.

Each incoterm has different points in the logistics process where the shipper (supplier) passes the responsibility onto the consignee (buyer).

So please do not ask your supplier for an ex-works FOB price as this will only confuse them.

Sorry Chris, but FOB incorporates the price of the goods as well as the price of getting the goods to the nearest port, hence making the items Free on Board. There is only one definition for the term FOB and the customs website has a quick way of showing what is covered under each incoterm (http://www.customs.gov.au/webdata/resources/files/Incoterms.pdf)


Cat :)