What Is Freight Prepaid and Add?

Freight prepaid and add, or prepay and add, is one of the freight terms that say who pays the freight bill: the seller pays the freight up front, then passes the charge on to the buyer on its invoice. Infor's documentation for its Distribution SX.e ERP says freight terms codes define freight billing methods that indicate who is paying the freight bill.

In that documentation, the Prepay and Add freight terms type reads differently depending on which side of the sale you are on:

• As the seller (customer record): freight is paid up front and then passed to the customer with an upcharge.
• As the buyer (vendor record): the vendor pays freight and passes the charge to you, as the customer, on their invoice.

Freight terms defaults can be assigned to a customer or vendor record. These defaults update the purchase order or sales order when it is created, but they can be changed on the order. In Infor's ERP, a Prepay and Add freight term on a sales order enables the Freight Outbound option, and on a purchase order it enables the Freight Expected option.

Infor's documentation lists the freight terms types side by side. From the seller's side:

• Prepay and Add: freight is paid up front and then passed to the customer with an upcharge.
• Destination: you pay freight and do not pass freight charges to the customer.
• Collect: the customer pays freight on their account.
• 3rd Party: the customer designates another company to which freight is billed.
• Pickup: the customer picks up and is not charged freight.

The same documentation notes that you can use International Commercial Terms (Incoterms) as freight terms or create and define your own.

A distributor ships a pallet of goods worth $2,400 to a contractor. The carrier bills the distributor $180 for the move.

• Prepaid and add: the distributor pays the carrier $180 and invoices the contractor $2,400 + $180 = $2,580.
• Prepaid and add with an upcharge: if the distributor adds a $20 handling charge, the freight line is $180 + $20 = $200 and the invoice is $2,600.
• Collect: the contractor pays the carrier $180 on its own account, and the distributor invoices $2,400.

Shopify B2B is on the Basic, Grow, Advanced and Shopify Plus plans. When you create a B2B draft order that requires shipping, Shopify lets you choose a preset shipping rate, create a custom rate, or choose local delivery or pickup in store. If a shipping method is preselected when the draft order is created, the customer can't modify that shipping method during checkout.

You can also set a company location to submit all orders as drafts for review. Customers then see a banner at checkout letting them know that payment is due when the order is confirmed, and no payment is collected at checkout. Orders submitted this way aren't complete until you click Create order or the customer pays after you send an invoice.

Uncap's page on packaging and shipping supplies treats freight terms as part of the deal: item level negotiated prices, tiers, volume breaks and freight terms live in the ERP, and Uncap Connect syncs them so the account sees its own number at login and at checkout. LTL and pallet shipments are rated as freight, with class, liftgate, appointment and residential handling, rather than as oversized parcels.

• FOB
• Incoterms
• Freight class
• LTL freight
• Bill of lading
• Accessorial charges

• Infor Distribution SX.e: Freight Terms field descriptions
• Shopify Help Center: Creating B2B orders using draft orders
• Shopify Help Center: Managing checkout settings in B2B