In current times when everyone has got so many options for so many things, it is inevitable to expect variety. Variety is something that revolves around bulk manufacture, production, and transportation of goods and commodities so that the goods reach their target market. In such scenarios of global trade, Freight Forwarding is an important concept though relatively rarely heard of.
What if we require to export/import goods internationally which is a very sensitive affair in terms of planning and executing? With all the expert advice needed through the entire process and important documentation, here comes the role of freight forwarding services. This concept is mandatory for many businesses without which they might not even exist in the global market.
What is Freight Forwarding?
Freight forwarding falls under the category of cargo shipping services, which is a coordinated chain regarding the shipping of goods or commodities via multiple channels including air, sea, inland waterway, rail, and road. The main purpose of Freight Forwarding services is that it is quite a help when it comes to global shipments and trade, with plenty of coordination and strategic planning, customs and legal regulations, and documentation so that the shipments can be executed easily and timely across borders. FFFAI – Federation of Freight Forwarders Association, is the apex body that represents Freight Forwarding member associations from all over India.
Steps involved in Freight Forwarding:
- Transfer of goods/commodities from the starting point to freight forwarder’s warehouse
- Export Customs Clearance – Clearance for good/commodities to leave the country of origin
- Inspection and validation of cargo against booking documents
- Import Customs Clearance – Checking of customs documentation
- Handling the cargo upon reaching the destination, transfer to import warehouse
- Transfer of cargo from import warehouse to the final destination
Who are Freight Forwarders and what is their role?
Freight Forwarders are those companies or agents that help in the timely, successful, and efficient movement of commodities in good condition by showcasing expertise in terms of freight rate negotiations, custom clearances, documentation requirements, and contact network in the logistics industry.
They organize shipments from customers, manufacturers, and producers of goods (primarily indulging in international business), to the specified destination point. Such corporations or agents have a tie-up with general carriers for transportation which also provide their services to the public under a licensed name and authority.
Freight forwarding agents or companies do not transport the goods on their own but provide all the necessary expertise when it comes to logistics including warehouse planning, cargo insurance, and customs clearances among others for an optimized supply chain.
The cargo shipping process might seem stressful and intimidating when it comes to paperwork, customs, logistics, and many other things. The freight forwarder takes care of all these responsibilities so that the shipment can be easy, convenient, and cost-effective.
Some value-added services provided by a Freight Forwarder that can prove to be advantageous:
- Provide cost-effective, convenient, and efficient cargo shipping solutions according to requirements
- Advice regarding tariffs including freight charges, customs clearance expenses, documentation costs, etc.
- Suggest the best possible route for shipment based on nature and safety of goods, cost, and ensuring timely arrival of goods
- Have expertise and sound knowledge of customs regulations that vary from country to country
- Possess strong network within the logistics industry and collaboration with multiple logistics firms that support in improved supply chain management
- Negotiate tariffs, manage custom regulations, optimize warehousing, cargo space scheduling and freight consolidation, supply cargo insurance, and shipment tracking
- Process relevant shipping documents like commercial invoice, bill of lading, certificate of origin, inspection certificate, export license, etc.
Difference between Logistics and Freight Forwarding
Though logistics and freight forwarding services may seem alike, there is a major difference between the two. Freight forwarders partner with multiple logistics companies nationally and globally, ensuring that their price comparison sense is far better off than what an importer/exporter would get while working with the logistics firms directly.Also, freight forwarders have far more experience and knowledge regarding cargo shipping routes and the nature of goods than the logistics firms and hence they can customize and optimize the cargo shipping process according to the customer’s requirements.
Lastly, it is always advisable to hire freight forwarding services instead of getting confused by working with the logistics companies directly as they would not be having expertise regarding the custom formalities and paperwork required. Logistics companies specialize in a certain area of the supply chain, unlike freight forwarders that have holistic expertise.
Types of Freight Forwarding services
Depending on the shipping requirements, the freight forwarder will suggest freight forwarding services via different channels and each of these cargo shipping routes will have a different process:
1. Air Freight Shipping
This channel is the fastest route of moving the commodities globally and is most preferred in cases where the delivery time of cargo is less and provides a gamete of locations for air freight services nationally and internationally.
Though air cargo services might be a little costlier than the other modes of cargo shipments, air freight shipping allows to save a lot of time and deliver within tight deadlines. However, this channel takes into account the limitation of the weight of goods and hence is recommended in case of transportation of comparatively lighter goods.
2. Sea Freight shipping
This is one of the oldest and cheapest modes of cargo shipping and makes use of ocean carriers to transfer commodities, packed in large cargo containers which are picked up by shipping vessels at major ports.
Though this means of shipping takes longer, it is suitable for transporting heavy and bulky goods. Another advantage of opting for a sea freight shipping service is that the freight charges are calculated by the number of containers, unlike the air freight shipping service that factors in the weight component as well.
Sea freight service gives the options of ‘full container load’ (FCL) shipping and ‘less than container load’ (LCL) shipping. FCL is generally used when the shipping of commodities is done in bulk and can fill up the entire shipping container. LCL is opted in case of lighter goods that do not take much space and can be packed with other shipments in the same container. In such cases, the freight will be charged for the space occupied.
3. Ground Freight shipping
This type of cargo shipping service can be categorized under ‘Rail Freight shipping’ and ‘Road Freight shipping’ services. This mode of shipment can be opted for in case of transporting the goods within country boundaries or across states/provinces. Though could be used alone, this channel is generally combined in an inter-modal route of cargo shipment that also has air freight or sea freight shipping services, either before or after.
When multiple channels of shipping are used, it is termed as ‘Intermodal Freight shipping’. Ground freight shipping includes the following:
a). Rail Freight shipping
Making use of the railway network extensively, this channel of cargo shipping service is cheap, environment friendly, saves time, cost-effective, and can transport bulk commodities, standard-sized containers, vehicles, specialized and hazardous goods.
Unlike, road shipments that are very much vulnerable to roadblocks, rail network freight shipments are free from all such obstacles.
b). Road Freight shipping
This channel of cargo shipping service makes use of trucks, trailers, or vans that transport the commodities either via ‘full truck load’ (FTL) shipping or ‘less than truck load’ (LTL) shipping.LTL is used in the case of smaller and lesser goods and is an economically viable option since customers only have to pay for the space occupied by their goods and will combine shipments from other customers as well in the same truck.
FTL is recommended in case the customer requires the full truck to ship the commodities. This mode is quicker than LTL since it transports shipment from only one customer, hence as a part of door-to-door shipment service, the exact pick-up and drop point will be specified.Time taken in road freight shipping is largely conditional to the roadway infrastructure across states/provinces.
Where can I find a trusted Freight Forwarder?
DBB Worldwide Pvt Ltd which stands true to its complete name ‘Delivery Beyond Boundaries’ is a Freight Forwarding company based out of Delhi, India, that takes care of all of the above requirements. Irrespective of whether it is a personal or a business cargo shipment, DBB Worldwide not only provides complete customer satisfaction but also is a trusted cargo shipping partner when it comes to comparing freight charges, providing custom clearances in and around Delhi, warehousing and cargo insurance, all at an affordable range of prices, guaranteeing efficiency and timely delivery/arrival.