Wednesday, August 19, 2009

How Shipping from the Wholesaler to the eBay Seller Works - by Worldwide Brands

By Chris Malta, CEO & Founder of Worldwide Brands

Wholesale Tips Series - How to find wholesalers, doing business with a wholesaler, what to expect when purchasing from wholesalers and more.

Tip #15

FOB is a shipping term. It designates: "Freight On Board" or "Free On Board". The wholesale supplier will pay the costs of handling and shipping up to the point the goods are FOB or Free on Board.” Whichever city is designated as the FOB city is the point where the wholesaler’s handling and shipping costs end.

For example - If the shipping documents state “FOB San Diego, CA,” then the wholesale supplier pays all costs to get the shipment to a terminal in San Diego, CA. From that point onwards the eBay Seller must either pick up the shipment, or forward it at the eBay Seller’s cost to the desired customer destination. All logistics and expenses after the shipment arrives at the terminal in San Diego, CA, must be paid by the eBay Seller.

Usually wholesale suppliers will get the shipment onto the shipper’s vehicle at the wholesaler’s own warehouse. The FOB will be declared as the wholesale supplier’s city and location. The eBay Seller will pay the costs of shipping to get the goods from FOB at the wholesaler's warehouse to delivery at the customer’s desired destination. To determine the correct Cost of Goods Sold, COGS, for the items and shipment, the eBay Seller will have to add their share of the shipping costs to the costs of the product to determine the correct profit per product.

Watch the short video below for more clarification on FOB.

Worldwide Brands is an eBay Certified Solution Provider, providing product sourcing access and information for eBay sellers. They are the publishers of an extensive directory of legitimate, fully-verified ecommerce wholesalers and manufacturers.

No comments: