The best international freight forwarders provide concierge-level customer service to clients by using seasoned and trained local teams.
Ocean, air, drayage, warehousing, and fulfillment require keen attention to detail. The company chosen should have personnel in-place, and excellent industry connections, to remove the bureaucratic burden from their clients.
What Is a Freight Forwarder?
A non-vessel operating common carrier (NVOCC) is another name for a freight forwarder.
Essentially, a freight forwarder organizes shipments for clients. They provide or organize and manage all the services required to get a company’s goods from the manufacturing plant to the final point of distribution.
This often includes the use of multiple carriers, ships, planes, trucks, or railcars, to move your freight from point A to point B, or from country A to country B.
Freight forwarders review and process the commercial shippers export declaration. Part of the service may include assisting the factory in preparing all documents for transporting products.
Good freight forwarding companies will not only help prepare the documents but can offer advice on characterizing the information in the most favorable way possible for the shipper and receiver as it relates to customs and import duties.
International freight forwarders track shipments on behalf of their clients, book cargo space, prepare bill of ladings, negotiate freight costs, obtain appropriate cargo insurance, and file insurance claims as needed.
Finding the Right One
A company looking for an international freight forwarder should conduct some due diligence prior to entering into a contractual arrangement. Ask the right questions to determine if it is the right fit.
Ask about experience and credentials. Is the company licensed with the U.S. Transportation Security Administration (TSA), the International Aircraft Transport Association (IATA) and the Federal Maritime Commission (FMC)? Is the company a licensed non-vessel operating common carrier (NVOCC)?
Check testimonials and reviews from other exporters. Ensure that the company has enough experience and industry knowledge.
Go over costs and ask about volume discounts and any charges for incidentals.
The shipping container industry often uses the term drayage, although the term pertains to other shipping industry sectors as well.
To an international freight forwarder, drayage refers most often to the movement or trucking of containerized cargo, often unloaded from a ship but also from a plane or rail car.
Drayage always means moving something a short distance. It may mean trucking containers from one port to another or from one part of the rail yard to another. It may also refer to moving the containers to the destination.
The drayage charge is the cost of this movement. The drayage may be prepaid by the shipper, as indicated on the bill of lading, or can be a cost incurred by the buyer.
Why Use a Freight Forwarder?
Companies are not required to use a freight forwarder. However, most companies should seriously consider doing so.
Importing and exporting anything from one country to another requires adhering to many different rules and regulations that almost always differ from country to country.
In addition to customs and import laws, there are international maritime shipping regulations, air cargo rules, transportation and packing requirements, and more.
The extra costs, and potential fines for failure to follow import or tax laws can be hefty.
Companies find it much more efficient to partner with an international freight forwarder with the experience and know-how to ensure all the paperwork is done correctly.
A freight forwarder can properly coordinate and manage all the participants – transportation companies, customs officials, and more – on behalf of his client.
Ocean versus Air Shipments
The two main ways international freight forwarders use for cargo shipment are ocean and air:
Forwarders review and determine the best consolidation options for companies for container shipments.
The freight forwarder negotiates the contracts, books the shipment with the ocean carrier, reviews and addresses packaging requirements, paperwork, and tracks the shipment for the company throughout the voyage.
Finding competitively priced air shipment options is part of a forwarder’s job. Forwarders handle all the technical requirements of air cargo, including documentation and local and foreign government regulations.
Your freight forwarder determines and manages the air-to-surface transport, including loading and unloading.
What about U.S. Customs Support?
One of the most difficult aspects for companies, U.S. and foreign, shipping goods to and from America is understanding and properly addressing all the U.S. Customs procedures and requirements.
The inability to understand and appropriate address U.S. Customs requirements can be very costly.
A good freight forwarder handles all clearance formalities quickly and smoothly. All paperwork should be prepared early and submitted in a timely fashion to avoid any delays.
Duty payments should be part of the preparation, with all financial transactions done in accordance with U.S. laws.
Warehousing services are an important aspect of an international freight forwarders’ services.
For example, a freight forwarder manages ocean freight container loading and unloading.
The forwarding company should have access to and agreements with warehousing and handling facilities in the various countries where the cargo will depart, arrive, or transit.
A forwarder will have planned for and offer long-term as well as short-term storage options depending on circumstances.
Transloading and Cross Docking
Different types of cargo require different types of trucks to load and transport the products. A forwarding will arrange a straight truck, intermodal container, or flatbed to deliver the material to segregate the different cargo from the containers for warehouse storage or deliver it to multiple locations.
Fulfillment arranges include stocking a company’s products at strategically located facilities not only for fulfillment to customers but locations that can efficiently manage the entire return process.
Things like postage fees and address validations are something a forwarder will review to ensure the fulfillment center can meet client expectations in a cost-effective way.
Technical Tools and Expertise
It is important that a freight forwarder keep current with all the latest technology available for full-service shipping companies.
A quality freight forwarding company uses cloud-based systems and storage, with integrated software addressing ocean and air freight requirements, import and export regulations and paperwork for origin, destination, and transit locations, real-time cargo tracking, and useful reports available to clients.
Management, Communication, and Customer Service
The key to any freight forwarder’s success is customer service. Good customer service requires good communication and management. A company must be able to trust that your freight forwarder will get your goods delivered on time, in good condition, and with no hidden or unexpected costs.
A freight forwarder should have a sterling credit rating. A company does not want their products delayed because the freight forwarder could not pay the carriers and may have incurred additional demurrage and detention charges.
This can also affect a company’s relationship with the consignee if the products are late or held up in customs.
A great air forwarding company can be a partnership for life. A seasoned international freight forwarder will have contingency plans for any act of nature or political upheaval.
The company chosen should take all the administrative headaches away from the exporter and allow the company to concentrate on product development, production, and improving their bottom line.