What are Freight Forwarders?
By Dermound Becker
Special to VanLines.com
Simply put, a freight forwarder acts as a third party or agent for people who need to arrange cargo movement to international locations. They organize the entire process including shipping, moving rates, customs, etc. Basically, they will help you get your merchandise from point A to point B with as much efficiency as possible.
Freight forwarders generally handle international transactions and are mainly used by businesses who export products. They act on a person or business's behalf and are designated and authorized by a power of attorney. They also have no vested interest in the products.
So, how do freight forwarders make their money? By buying up a large volume of space either on planes, trains, trucks or ships, and then selling that space to the exporting company.
Freight forwarders will generally help you determine which mode of transportation is best for you, help you with your packaging and book the space for your shipment. They will even help to arrange for the products to clear customs, provide insurance and provide you with space at airport terminals or warehouses.
Freight forwarder fees generally include the basic fee, freight fee for air/ocean transportation, communications fee, insurance fee and certificate/legalization fee. If you are going to enter into a long term relationship with the company, they may consolidate some of these fees and offer you a lower price for your transactions.
Depending on the country you are in, freight forwarders may require licenses. For example, n the U.S. freight forwarding companies need to be licensed, but not necessarily so in Nigeria and the UK.
Some freight forwarder companies specialize in dealing with certain countries or regions; others base their expertise on their relationships with different countries and customs. When you're looking for a freight forwarding company, part of your decision should be based on where you plan on exporting the most and how much experience that company has with that country.
A freight forwarding company can save you an insurmountable amount of time, energy and resources by coordinating all of your international shipping needs for you. They take care of all the customs forms, and the processing and handling of your shipment throughout the entire process. You will need to provide them with several documents including copies of your company letterhead, and packaging forms, an IRS reporting number, and permission for them to sign legal documents on your behalf. This information allows them to act on your behalf and in your best interests during the transaction. They will only involve you in the process if it is absolutely necessary; otherwise, they will take leadership of the shipping and exporting process and make sure that your cargo arrives at its intended destination with no fuss.
Freight forwarders can give you the peace of mind and leadership that you need in order to make sure that your moving boxes arrive on time. They coordinate the entire process from start-to-finish and allow you to concentrate on other aspects of your business. The service they provide outweighs the nominal fee they charge.