August 8, 2023

Navigating a FOB Contract When a Scheduled Truck Pickup Fails

Dealing with a situation where a truck fails to show up for a scheduled pickup under a documented FOB contract can be complex and frustrating for shippers. To handle such scenarios effectively, a structured approach is essential. If you’ve established an agreed-upon appointment time for loading with the buyer, it’s crucial to remain reasonable while assessing the situation. Here’s a step-by-step guide on how to address these challenges: 

  1. Setting Expectations: To initiate this process, it’s important that both parties have previously documented the exact appointment time/date for loading. However, it’s worth noting that unless there’s a prior written agreement, carriers are generally not held to an exact minute-by-minute schedule.
  2. Reasonable Delays: When assessing how late is too late, consider employing a reasonable person formula. For instance, if the delay is within a few hours, especially in the produce industry, making reasonable accommodations to reschedule the truck should be your first approach. 
  3. Proactive Communication: If the delay is significant or extended, it’s imperative to maintain proactive communication. This involves notifying the buyer immediately about the failed scheduled pickup and offering them a chance to address the situation. 
  4. Escalation Protocol: Should rescheduling not be feasible, you should formally notify the buyer in writing about the breach of the FOB contract due to the carrier’s inability to load the produce. This step helps establish clear accountability and lays the groundwork for potential recourse. 
  5. Mitigating Damages: In case the situation escalates and damages occur, your role as a shipper is to minimize these damages. Inform the buyer about your actions to mitigate loss, including selling the produce for the benefit of all concerned parties. Keep precise records of the exact lot and quantity intended for shipment. 
  6. Documentation for Liability: To hold the buyer liable for the difference between the agreed FOB price and the actual outcome, thorough documentation is paramount. Ensure that the source of proceeds aligns directly with the lot that wasn’t shipped to the original buyer. 
  7. Balancing Expectations: While a specific loading time is important, a balanced approach is vital. Agreeing to load a truck beyond the original date should be done while considering the produce’s freshness and adherence to Good Arrival Guidelines. 
  8. Complexities and Solutions: Acknowledge that numerous variables can impact a truck’s timely arrival. Recognize that not all scenarios have a one-size-fits-all solution. Thus, safeguarding your interests requires a tailored strategy. 

To conclude, effectively managing a situation where a scheduled truck pickup under a documented FOB contract fails demands a methodical and reasonable approach. If you are a member of Western Growers and face such issues regularly, I encourage you to reach out for personalized guidance. Your proactive approach will ensure smoother transactions and mitigate potential losses in the challenging world of shipping under FOB contracts. Additionally, if you have questions or suggestions for future blog topics, please don’t hesitate to get in touch directly at (949) 885-4808 or by email at [email protected]