As an individual business owner or a company, it can be challenging to ship your products internationally, mainly because of the numerous logistical issues. Top among them are long queues and astronomical costs.

For instance, in 2022, over 1900 workers at the largest port in Britain began an eight-day strike. The strike massively disrupted supply chains and trade in the UK, resulting in colossal congestion of containers, as many companies had their valuable cargo stuck at the port.

It’s estimated that the strike caused a loss of more than $800 million.

Assuming most of the businesses had hired freight forwarders to handle their shipping. They could have rerouted, avoided the delays at the port, and incurred minimal losses if any.

Contrary to popular belief, freight forwarders are for more than just large companies. They also work with small businesses and can immensely help them grow.

Studies have also shown that the freight forwarding market has steadily risen over the past three years. Meaning more businesses are using these services to avoid logistical nightmares.

This post will look at the benefits of hiring a freight forwarder.

Who is a Freight Forwarder?

A freight forwarder, also called a forwarding agent, is a company or an individual that works with you, transport providers and suppliers to move your goods around the globe.

It’s important to note that freight forwarders don’t get in physical contact with your cargo; they primarily act as intermediaries.

Functions of Freight Forwarders

Freight forwarders usually provide clients with various services throughout the supply chain, depending on your particular needs. Some companies specialize in air freight forwarding, ocean freight forwarding, or both.

Their forwarding service mainly entails the following:

• Consolidating shipments
• Organizing cargo insurance plus inspections on damage claims
• Organizing hand carriers (onboard carriers) for top-priority packages
• Negotiating affordable freight rates with shipping carriers 
• Planning special transport like charters for over-dimensional or time-sensitive shipments
• Designing the packaging, safe handling and protection of your cargo
• Constantly tracking shipments and providing regular updates to clients 
• Booking the ideal modes of transport for your load; intermodal transport from rail, sea and air
• Providing wholistic logistic services including warehousing, customs clearance and transportation to the final destination
• Import and export custom clearance lodgements
• Full container certification and weighing (Verified Gross Mass)
• Handling taxes, HS Code Classification and import duties
• Preparing, submitting, and reviewing export and shipping documents 

What are the Benefits of Hiring a Freight Forwarder?

Accountability and Experience

When moving your goods internationally, they will have to travel thousands of miles before reaching their destination, which means the chances of goods getting damaged or lost increases.

This raises critical questions about oversight and accountability.

That’s why an exporter or an importer must work with a professional in the freight forwarding industry, someone with the requisite experience and knowledge.

A professional freight forwarder can offer you invaluable advice while also helping you to manage full container loads (FCL) and less-than-container load shipments (LCL).

They will also help you map out optimal routes and, using their worldwide network of partners, and recommend the ideal means of transport.

Freight forwarders are valuable due to their ability to make the exporting and importing process uncomplicated for multinational corporations and novice business owners.

Compliance

To successfully ship your goods internationally, you must meet regulatory and legal requirements across various jurisdictions.

This means proper administration and having the correct documentation throughout t the process.

You will need documents like:

• Bills of lading
• Letters of credit
• Incoterms
• Customs declarations
• Harmonized systems codes (HS codes)

Incoterms, widely-used terms of sale, are a set of 11 internationally recognized rules which define the responsibilities of sellers and buyers. Incoterms specify who is responsible for paying for and managing the shipment, insurance, documentation, customs clearance, and other logistical activities.

Lacking any of the above-listed documents or failing to submit them can result in hefty fines or confiscation of your goods, which could result in immense losses.

Freight forwarding companies take this stress off you by ensuring your shipments comply with all international regulations.

They understand all the legislation required for each type of shipment, for instance, dangerous goods and shipping modes.

In addition, freight forwarders stay updated on any policy or procedure changes; thus, you will never incur penalties while shipping.

Technology: Cargo Tracking

When shipping goods, you will always need answers to three questions; where are the goods, how much time will it take for them to arrive and at what cost?

Freight forwarders have innovative shipment tracking systems like Freight Pop that they use to know exactly where your goods are.

Such information is critical as it shows transparency, creates reliability and develops trust between you and your clients.

Reduced Costs and Time Spent

Freight forwarders can negotiate more affordable rates with transport providers than individual business owners. Primarily due to the large quantities of containers they coordinate and manage on behalf of their clients.

In simpler terms, they have the advantage of economies of scale.

Like any other industry, shippers will offer better discounts to customers with the most goods.

Therefore, single customers rarely get access to bulky spaces on cargo ships; however, using a freight forwarder offers such benefits.

Other savings you can make while using a freight forwarder include reduced insurance, fees and port charges.

In addition, forwarders give you an upper hand by directly purchasing container spaces on transport vessels, which provides better security for your goods. You will also benefit from the reduced transport cost per TEU (Twenty Equipment Units).

Freight forwarders also follow all the international shipping regulations. Therefore, your goods will always arrive on time.

Plus, you won’t face delays, such as your goods being held at the port or paying costly fines.

Even in unexpected circumstances, such as port worker strikes or bad weather, freight forwarders will redirect the shipments and avoid unnecessary delays.

Enhanced Flexibility

Freight forwarders have lots of experience in numerous industries, and they have superb negotiation skills.

Also, given that the international shipping industry is growing fast, you will need a professional to allocate optimal resources for your business and help you follow the right direction.

Working with a freight forwarder offers you immense flexibility since changing your mind won’t be as costly as when alone.

For instance, due to the complex nature of the shipping process, you will have to change things like routes constantly. A freight forwarder will help you implement such changes conveniently.

Qualified freight forwarders also offer you additional information when it arrives. For example, they can tell you when you can utilize an available capacity.

Consequently, you can redirect the cargo and efficiently meet your customer’s needs.

Due to such flexibility, most businesses working with freight forwarders record increased profitability and productivity over time.

You will immensely benefit from working with a freight forwarder if you are also entering a new sector. They will help you understand your chosen industry and link you with the right people.

Therefore, you will make fewer mistakes and maximize your profits.

Improved Versatility

Transportation in international shipping isn’t always predictable.

Freight forwarders make them more predictable using accurate and timely information. Plus, they will ensure you are in an ideal position to handle any unplanned market changes.

For predictable changes, a freight forwarder will help you get the most from them.

Some top issues freight forwarders can tackle include freight delays and rerouting.

Therefore, you will meet the set deadlines and the stressful task of dealing with lots of bureaucracy.

Global Network

Due to the nature of their work, a freight forwarder will usually develop and grow a global network of partners to enable them to expedite the movement of goods cost-effectively.

Some of these relationships may include:

• Ground handlers
• Financial brokers
• Custom officials
• Fellow freight forwarders
• Warehouse operators
• Local logistic companies

You benefit directly from their network when you work with an experienced freight forwarder.

Streamlined Supply Chain

Freight forwarders remove the confusion and all the barriers in international shipping. They make it easy for you by handling everything from warehousing, customs brokerage, local trucking, and more.

How to Pick a Freight Forwarder

Conduct a Self-Analysis

Before you pick a logistics provider, you must first analyze your businesses or companies’ particular needs.

What services do you require, how much load do you want to be shipped and how often?

After you know precisely what you want, you can determine what to expect from a freight forwarder.

Consider Industry Experience

The international shipping industry is highly complex, and as a business owner, you entirely depend on the freight forwarder to make it error-free.

Therefore, you will have to pick a company with lots of experience.

A skilled forwarding company should understand how to navigate issues in warehousing, customs or routing lines. They also need to know how to handle emergencies like strikes and port shutdowns.

It’s worth noting that a freight forwarder may be experienced but not in your particular industry.

So, you should pick a company that has previously dealt with experts in your industry.

You can check such information by reading their online reviews or asking them to prove they have handled similar goods before.

Check Their Network

A qualified freight forwarding company should have a solid global network of partners to ensure the timely arrival of goods, make sure to check if they are a WCA approved member.

You can ascertain their networking by confirming whether the company has offices close to your clients and suppliers. Also, ask them if they have contacts of customs officials.

The company should also be part of one or two international shipping organizations. Such membership proves network and, more importantly, that they are legit.

Confirm the Services

Working with companies that provide sea freight, air freight, road transport, and other logistic solutions is critical.

Thoroughly discuss all your shipping needs with potential forwarders and ensure they can meet them.

For instance, if your business demands multimodal shipping or you may have to store goods for a long time in a warehouse.

By working with a company that only handles local shipments or has limited offerings will put you at a disadvantage. That’s because they won’t be flexible when issues arise, as they mostly do.

References

Before hiring a forwarding company, read through their references and recommendations. You can even talk to their previous clients.

Most companies provide such information on their websites. If you can’t find anything about them, that’s a sign they aren’t effective in their work. Thus, you should consider another company.

Customer Service

Critically analyze the time it takes for a forwarder to respond to your requests. Is their customer care team friendly and concerned, and do they provide prompt responses?

When you ask questions, do you get knowledgeable answers, and can they connect you to persons or resources for more information?

If the company doesn’t meet such requirements, it would be best to avoid them even if they charge low prices to handle your shipment.

If they are slow to answer your questions, they won’t take proper care of your goods.

Insurance

Cargo insurance is essential when shipping expensive goods internationally. Check what insurance company a freight forwarder uses and what the insurance covers.

The insurance must cover your goods in case of theft and damages obtained while in transit or storage.

Use of Technology

You should hire a company that uses current technology. The new and improved logistic software enables a forwarder to communicate effectively with logistic providers and clients.

You will also get real-time information on the status of your cargo. Some freight forwarding companies have EDMS, Electronic Data Management Systems, which facilitate improved reporting and fast access to records, invoices and shipping documents.

Permits, Licenses and Certifications

International laws require a freight forwarder to have various documents, permits to handle cargo, and special licenses to move dangerous or sensitive products.

For example, a freight forwarder must have a broker bond. A broker bond proves that the company is financially solvent, saving you money if the forwarder runs into trouble.

Your chosen company should have all the necessary licenses and be ready to produce them for confirmation.

Price

When looking for a freight forwarder, your primary focus shouldn’t be on the price they charge, but this also plays an important role.

A company charging a relatively low price to work with you might not have all the necessary tools to ensure your cargo’s safe and timely delivery.

Therefore, you should pick a company that meets all your needs and demands a reasonable price.

Going with the cheapest provider could seriously cost you in the long run when challenges arise. Although we’re very economically viable, MFS focuses more on quality service than anything else so we can be there for your team whenever you need us.

Conclusion

Hiring a professional freight forwarder to handle your international shipping can offer plenty of benefits.

They include:

• Reduced costs
• Access to a global network
• Enhanced flexibility
• Real-time cargo tracking
• Improved versatility
• Streamlined supply chain

Are you ready to get help with freight forwarding?
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