Importing and exporting are key components for many lucrative businesses. International shipping could present great business opportunities for you, but may also seem daunting.
If you have not heard the term “freight forwarder” before, you may be a little confused. Is it a shipping company? A distribution manager? An importing and exporting partner? A commercial freight forwarder is none of these things — but it takes on some of the responsibilities of all of them. Here’s what you need to know about using an international freight forwarder for your business-to-business shipping.
The process, paperwork, and regulations involved in international trade may seem intimidating. However, you can be a successful international shipper without getting caught up in the logistics of logistics.
That’s what a freight forwarder is for.
This blog covers the basics of what a freight forwarder is, what a freight forwarder does, why you should use a freight forwarder, and even how to find a freight forwarder for those who are interested in international shipping, whether importing or exporting.
Here are the most commonly asked question about freight forwarding and their answers:
What is a freight forwarder?
BusinessDictionary.com defines a freight forwarder as follows:
Firm specializing in arranging storage and shipping of merchandise on behalf of its shippers. It usually provides a full range of services including: tracking inland transportation, preparation of shipping and export documents, warehousing, booking cargo space, negotiating freight charges, freight consolidation, cargo insurance, and filing of insurance claims. Freight forwarders usually ship under their own bills of lading or air waybills (called house bill of lading or house air waybill) and their agents or associates at the destination (overseas freight forwarders) provide document delivery, deconsolidation, and freight collection services. Also called forwarder.
That definition is a little wordy and sounds complicated, so let’s just do a basic definition as follows:
A freight forwarder is a company that arranges your importing and exporting of goods.
So what does that actually mean in terms of what a freight forwarder does?
What does a freight forwarder actually do?
There is a lot that goes into arranging your international shipping. While the freight forwarder handles the details of your international shipping, it is important to know what a freight forwarder does not do in order to understand what a freight forwarder actually does.
A freight forwarder does not actually move your freight itself.
The freight forwarder acts as an intermediary between a shipper and various transportation services such as ocean shipping on cargo ships, trucking, expedited shipping by air freight, and moving goods by rail.
A freight forwarding service utilizes established relationships with carriers, from air freighters and trucking companies, to rail freighters and ocean liners, in order to negotiate the best possible price to move shippers’ goods along the most economical route by working out various bids and choosing the one that best balances speed, cost, and reliability.
Freight forwarders handle the considerable logistics of shipping goods from one international destination to another, a task that would otherwise be a formidable burden for their client.
Export.gov puts it this way:
To comply with export documentation and shipping requirements, many exporters utilize a freight forwarder to act as their shipping agent. The forwarder advises and assists clients on how to move goods most efficiently from one destination to another. A forwarder’s extensive knowledge of documentation requirements, regulations, transportation costs and banking practices can ease the exporting process for many companies.
That leads us right into the next question.
Why should I use a freight forwarder?
A freight forwarder is not required for importing or exporting goods. However, because importing and exporting can involve so much documentation and so many regulations, and these regulations and the required documentation can vary from country to country, many of the most successful importers and exporters use a commercial freight forwarder to be their logistics partner.
Knowing the shipping companies, the documentation, and the customs laws of various countries is their job. They know it all so you don’t have to. That means a good freight forwarding service can save you untold time and potential headaches while providing reliable transportation of products at competitive rates.
A freight forwarder is an asset to almost any company dealing in international transportation of goods, and is especially helpful when in-house resources are not versed in international shipping procedures.
There are many advantages to using a freight forwarder. Here are a few listed:
- A Freight Forwarder handles ancillary services that are part of the international shipping business
- Customs Documentation
- A Freight Forwarder provides to consolidators as well as individual shippers:
- Non-Vessel Operating Common Carrier documentation
- Bills of Lading
- Risk Assessment and Management
- Methods of International Payment
- A Freight Forwarder insists on personal communication and great customer service.
Again, Export.gov puts it well:
Whether the firm is large or small, the weight of the cargo light or heavy, the freight forwarder will take care of cargo from “dock to door” if requested to do so. This can include the correct filing of export documentation, all arrangements with carriers, packing, crating and storage needs. So, the small and medium-size exporter need not deal with many of the details involved with the logistics of exporting their goods. In addition, freight forwarders typically charge modest rates for their services and have access to shipping discounts. Given the years of experience and constant attention to detail provided by the forwarder, it may be a good investment.
How do I find freight forwarder?
You’re in luck! You’ve found one already. This is the website of Universal Cargo Management, a trusted freight forwarder since 1985. We’ll be happy to help you with your international shipping needs.
There are many places you can find freight forwarders.
The Port of Los Angeles’ website has a list of freight forwarders and here are a few privately operated forwarder listing services that Export.gov shares: 1800Miti.com, Directory of Freight Forwarding Services, FreightGate.com, and FreightNet.com.
Can a Freight Forwarder Complete Business to Business Shipping?
Yes! This is exactly what we do at Universal Cargo.
When you have a B2B company and you need to get your cargo to your business partners, you want a shipping chain of custody you can trust. For decades, Universal Cargo has been making sure that your goods get to their destination when they are supposed to, whether by air, sea, or land — and that all the required documentation is in order and ready to present when needed. If you need the ideal business to business shipping solution, contact Universal Cargo to arrange commercial freight forwarding today!