What does the term FOB mean?

👉🏻 The term ‘Free On Board’ (FOB) means that the seller of any goods places his product on a vessel placed by the buyer at a pre-agreed port, and that the buyer bears all transportation costs and risks involved, until the arrival of the goods at the port of destination.

✔️ The FOB value represents the cost of the goods at the point of shipment or loading (includes price of goods, packaging and freight charges), but does not include insurance and freight costs.