What is the Meaning of FOB,CIF&CNF for in Import business?

Question

What is the Meaning of FOB,CIF&CNF for in Import business?

Answer 1

FOB is Freight On Board - a way of shipping by private truck.

Sorry, I don't know the others.

Answer 2

FOB stands for "Free on Board."  It refers to the physical location that title to the goods changes hands from the shipper to the recipient.  At that point, the recipient assumes the risk of loss and takes responsibility for any shipping charges.  It has nothing to do with the method of shipment.

An example might make it a bit easier to grasp.  Say you order a seavan of widgets from a factory in Kunshan, China.  The goods will be trucked to Shanghai, loaded on a ship bound for Los Angeles, and then trucked to your business in Phoenix.  

FOB Kunshan means you take title at the shippers dock. You are responsible for all shipping charges and assume all risk of loss at that point.  

FOB Shanghai means that you take title when the goods are loaded onto the ship in Shanghai.  The shipper pays for the shipping charges to the port and assumes the risk up to the point where the goods are loaded onto the ship.  You assume title as the goods enter the ship and are responsible for all onward shipping charges.

FOB Los Angeles means that you take title as the goods are offloaded in LA.  The shipper assumes the risk up to that point and pays the shipping charges to that point and you take over the risk and shipping charges at that point.

FOB Phoenix means that you take title as the goods arrive on your receiving dock and assume any risk of loss at that point.  Needless to say, there would not be any additional shipping charges at that point.

CIF stands for Cost, Insurance & Freight.  The cost of the goods plus insurance and freight charges, normally to the Port of Embarkation unless a different FOB point is specified.

CNF -- Same as CIF, but without insurance.  With CIF terms, the shipper selects the insurance carrier.  Loss of goods on an international shipment may involve filing a claim with a foreign carrier.  If you select CNF terms you'd generally arrange insurance yourself from a local company.  That should normally make filing a claim easier.