What is Free On Board in SAP SD-FT - Foreign Trade?

SAP Term: Free On Board

• Component: SD-FT

• Component Name: Foreign Trade

• Description: An international commercial term under which the seller fulfills the seller's obligation to deliver when the goods have passed over the ship's rail at the named port of shipment. The buyer must bear all costs and risks of loss of or damage to the goods from that point. The Free On Board FOB term requires the seller exporter to clear the goods for export. This term can only be used for sea or inland waterway transport.

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• Key Concepts: 
  Free On Board (FOB) is a term used in international trade to indicate when the ownership of goods is transferred from the seller to the buyer. It is a term used in the context of Incoterms, which are a set of international rules that define the responsibilities of buyers and sellers in international trade. In FOB, the seller is responsible for delivering the goods to a designated port or place of export, and the buyer is responsible for paying all costs associated with transporting the goods from that point to their final destination. 
  
  How to use it: 
  In SAP SD-FT Foreign Trade, FOB is used to determine who is responsible for paying for freight and other costs associated with transporting goods from one country to another. The FOB term can be used in sales orders, contracts, and other documents related to international trade. It can also be used to determine who is responsible for paying customs duties and taxes. 
  
  Tips & Tricks: 
  When using FOB in SAP SD-FT Foreign Trade, it is important to ensure that all parties involved understand their responsibilities and obligations. It is also important to ensure that all documents related to international trade are accurate and up-to-date. 
  
  Related Information: 
  For more information on FOB and other Incoterms, please refer to the International Chamber of Commerce website (https://iccwbo.org/resources-for-business/incoterms-rules/).