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Understanding FOB Terms: A Guide for Customers in Container Shipping.

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As a manufacturer specializing in Horizontal Slow Juicers, we often work with the minimum order quantity of one container. To simplify the process for both us and our customers, we typically engage in Free On Board (FOB) shipping terms. Here’s an insight into the FOB term and its nuances that might not be widely known among customers:

1. FOB Quotation Varies by Port


FOB, short for “Free on Board,” means that we, as the factory, coordinate with a freight forwarding company specified by the customer to book and collect containers. However, FOB terms can vary based on the departure port. For instance:

    FOB, short for “Free on Board,” means that we, as the factory, coordinate with a freight forwarding company specified by the customer to book and collect containers. However, FOB terms can vary based on the departure port. For instance:

    • FOB Shenzhen, FOB Guangzhou, FOB Foshan, FOB Xiaolan, etc., each correspond to different ports and provinces.
    • The towing cost, a significant component of the FOB price, depends on the distance from our factory to the designated port. For example:
      • FOB Xiaolan/Zhongshan port may incur a towing cost of about 1000 yuan.
      • FOB Guangzhou and FOB Shenzhen could be around 3000 yuan.

    2. Calculation of Local Charges

    Local charges encompass all expenses from the factory to the port. This includes towing fees, original bill of lading costs, handling fees, sealing fees, and port construction fees. These costs can vary with the container type:

    • Small containers might cost about 1500 yuan.
    • Larger containers usually range between 2000 to 2500 yuan.

    Therefore, for a 40HQ container, the total local cost including towing fees can be about 4000 to 4500 yuan. Keep in mind that these charges may vary depending on the freight forwarder.

    3. The Reluctance and Necessity of FOB

    While FOB is operationally convenient for factories as it involves delivering goods to the port only, it’s not always favored by companies. This is because some shipping companies add extra charges to local costs. Additionally, the customer-appointed freight forwarding service might not always be up to par in terms of service quality.

    4. When Customers Lack a Designated Forwarder

    In cases where customers don’t have a specific freight forwarder, we can recommend reliable ones from our network, which handle both sea and air transportation. We ensure to provide choices that are competitive in the market price-wise. Although these forwarders are suggested by us, the payment terms remain as per FOB standards.

    As we predominantly deal with large, containerized shipments, FOB is our most common term of trade. While there are other shipping terms available, our focus remains on FOB for its simplicity and efficiency for both parties involved in the transaction.

    This explanation aims to clarify the FOB process and its various aspects, ensuring that our customers are well-informed and comfortable with the shipping terms when ordering our Horizontal Slow Juicers.

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