The most common shipping method is called freight on board (FOB). FOB is a term used in shipping to refer to the place where the buyer becomes responsible for both the shipment and the shipping charges. Example: If a buyer lives in Des Moines and buys a product FOB New York, the buyer must pay the shipping charges from New York to Des Moines and is responsible for seeing that it is properly insured during that shipment.
When ownership transfers from seller to buyer at buyer’s dock, the arrangement is called a destination contract. These arrangements include a contract of sale in which a seller bears the risk of loss all the way, until the shipment of goods reaches at its named place of arrival (or port of destination).
Another shipping option is called ship in place, which means the manufacturer can transfer ownership and invoice the customer while the equipment remains in the custody of the manufacturer.
Upon arriving at a site, the buyer or the buyer’s designated representative must properly inspect the shipment upon arrival. Electrical equipment damaged in shipment, staging, or installation may fail, damage other equipment, or cause personal injury.
The new owner must also protect the equipment while it is staged for future installation. Mishandling equipment can damage it or allow dirt, dust, and moisture to enter the equipment, which can cause the equipment to fail in time. Responsibility for protecting the equipment rests with the general contractor, the owner, or a designated representative. The same person must carefully inspect the manufacturer’s original packaging to ensure that it is intact. If the packaging is damaged, the owner must have the original equipment manufacturer or its representative thoroughly inspect the equipment.