In short, it is an agency or company that offers export and import of goods between different countries.
A freight forwarder company manages or brokers shipments to or from other countries for a fee, including customs clearance. Customs must clear goods before they can forward them.
The customer needs to produce proof of entitlement to the goods in question, certificates of origin etc. Transport documentation will also need to be prepared – this could comprise a series of bills of lading, which show how the cargo has been divided up into manageable “lots” comprising multiple pieces/packages/cases etc., depending on size and weight considerations.
Freight Forwarders engage in import and export services with an extensive network worldwide. They offer many expert services for their customers. The most common services are:
- Warehousing
- Consolidation
- Shipping via an air/ocean/land mode of transportation.
- They can ship anything from raw materials to finished products.
- Costumes, duties, and tax clearances.
Why should you use a freight forwarding company?
A freight forwarding company allows you to access their extensive transportation and warehousing network. It is time and money-saving for the customer by having one contact to fulfil all needs. They also consolidate shipments to be charged with one bill instead of multiple fees from the different carriers they use.
What are some responsibilities of a freight forwarding company?
The primary responsibility of a freight forwarder is to handle the shipment until it reaches its destination. They also prepare and process all documents necessary, such as customs documents and other commercial invoices. They must know each country’s import/export laws, especially concerning taxes and duties. The freight forwarder can ensure your goods are handled smoothly through their vast network of carriers.
Who are the customers of freight companies?
A freight company’s customers are mainly importers or exporters, but the customers could also be manufacturers, traders, retailers etc. Freight companies serve individuals and businesses with their import/export needs.
Benefits of using a freight forwarding company
Processing is done for you
If you are not familiar with logistics, using a freight forwarder will take the headache away. Freight forwarding companies have vast logistics knowledge and can handle any shipment that comes their way, no matter how complicated.
Consolidation/division of goods
Freight companies have expert staff who understand how to group goods without them getting damaged in the process. It speeds up the exporting/importing process as multiple shipments do not need to be organised; instead, they can all be consolidated into one large shipment.
Save time and money
Using a freight forwarder saves you time and money by offering you a single contact for all your export/import needs, rather than having to hire different carriers yourself who may charge different rates. It would also save on administrative paperwork as the freight companies have vast experience in completing the relevant documents.
Expertise
Freight forwarding companies have staff with years of experience in exporting/importing goods from different countries, so they are fully aware of any challenges during the shipping process. The company owner is most likely an exporter or importer themselves, so it makes sense for them to understand what their clients need from them.
How does a freight forwarding company choose which carrier to use?
A freight forwarding company has an extensive network of carriers; some are based locally, whereas others may be international. They will choose their carrier depending on the type of shipment, where it needs to get shipped to etc. They will also choose a more cost-effective carrier if their client is on a tight budget.
What are the two most common challenges in shipping?
Customs Clearance
Customs clearance is undoubtedly one of the most challenging parts of the entire freight forwarding process. It varies depending on the country, although some countries tend to be stricter than others. The freight forwarder will deal with any issues regarding customs, so they do not become a problem for you.
Duties and Taxes
Duties and taxes are due once the goods reach their destination. These fees vary between countries, so there is no set standard price to incur. The forwarder will ensure that the correct documentation has been completed so that your shipment can cross borders freely without delay or additional costs.
In conclusion
Even the most experienced B2B and B2C suppliers recognise that freight forwarding is most successful when partnered with logistics experts. Always ensure you engage with a reputable freight forwarder, like Shipco, to make sure your goods arrive safely and on time—wherever you ship globally.
