Thank you! We will get back to you soon
Oops! Something went wrong while submitting the form.
Freight forwarding is an organized service that manages the shipment of goods. It’s an essential aid for global trade as it deals with local and international shipping.
The best part about a freight forwarding service is that you don’t need to actively oversee the shipment process. Instead, you employ a third party that handles your logistics operations.
In this article, we’ll explore what freight forwarding is and the stages in the freight forwarding process. We’ll also highlight the types of freight transport, top service providers, pros and cons, and FAQs about the freight forwarding industry.
Freight forwarding is a process that involves organizing the movement of goods from a shipper to the final destination.
This process is typically carried out by a third-party company known as a freight forwarder. They act as an intermediary between the shipper and the logistics companies by planning and arranging the shipping schedules, documentation, and more.
In short, they arrange the whole transportation plan on behalf of shippers.
Freight forwarding companies typically offer several services related to organizing your shipment, including:
Now, let’s look at what the freight forwarding process involves.
The first step in forwarding is export haulage — which is receiving the product from the client.
An affiliate carrier transports the products from the client to the freight forwarder’s warehouse. Modes of transportation may vary depending on the product type and distance to the warehouse.
The next stage is ensuring the cargo is cleared to leave the country of origin.
What papers do you need for export customs clearance?
Don’t worry. The freight forwarding company takes care of it. They’ll provide all the necessary paperwork to the customs agent. The agent then checks the legality of the items and whether it aligns with the information in the shipping documents.
Also known as origin handling, this step is carried out once the items are ready for transport.
The shipping company must ensure the products are in good condition. They’ll also confirm whether the items match the booking description and whether they’re accepted in the target location.
But wait, weren’t the products already cleared for shipment?
Yes, but for an international shipment, the cargo needs to comply with the restrictions placed by the country of origin and its destination.
For example, flammable liquids, drugs, alcohol, and sharp objects have strict regulations due to potential safety hazards.
Once the consignment arrives at the target location, the local authorities will go through the paperwork given by the freight broker.
They’ll confirm if the items match the description and meet the legal requirements to enter the country. Sometimes, the immigration officer might impose fees that the freight forwarding company will cover.
After the shipment has been cleared, another transportation team assigned by the freight forwarder will prepare the products for import warehousing.
They’ll keep the products at a designated storage location under customs supervision.
The local forwarding team will inspect the items and provide the customs documentation needed, including the air waybill, invoices, export packing list, certificate of origin, etc.
The final stage is complete when a local carrier ships the consignment from the import warehouse to the receiver.
But here’s the deal:
Shipping can take between a few hours to days after leaving the warehouse. It depends on the type of item, mileage, and mode of inland transportation.
Let’s look into what forms of transport these freight forwarding services typically use (and how fast they are).
An international freight forwarder relies on different modes of transportation to ship goods worldwide.
The four common types of freight transportation include:
Sometimes, a freight forwarder may require multimodal transport — which involves using more than one mode of transport to convey goods. It helps reduce transit time and costs.
Now, let’s look at some popular international freight forwarders and what they offer.
Below, you’ll find a list of some of the top freight forwarding companies and their freight shipping services:
DHL Supply Chain & Global Forwarding:
Hitachi Transport System:
UPS Supply Chain Solutions:
As you can see, there are plenty of reliable shipping companies in the global freight forwarding market.
However, you must first weigh the pros and cons of working with one before choosing a freight shipping company.
Like any logistic service, freight forwarding has its benefits and drawbacks. You can find a list of the biggest pros and cons below.
Now, let’s look at some FAQs related to the freight forwarding industry.
Here are answers to some questions you may have about freight forwarding:
Freight forwarding services are used by most industries across the globe, especially those involved with international shipping and distribution.
Examples of industries that use a freight forwarder are:
Sometimes, even small businesses use a freight forwarder to handle their international shipment.
A document transfer fee or document handover fee is a part of ocean freight charges. It’s charged to international freight forwarders, Non-Vessel-Operating Common Carriers (NVOCCs), and customs brokers for the transfer of documents.
It's paid by the importers at the immigration port of dispatch in the International Commercial Term (incoterm) and by the exporter at the port of origin’s Incoterms.
Freight forwarding software helps logistics companies streamline operations and manage the entire shipping process. It allows a shipping company to track cargo locations, create automated shipping documents and invoices, and oversee global trade projects.
With Shipthis, freight forwarders can:
Freight forwarding could be your company’s solution to logistics issues. It handles the shipping process, deals with customs regulations, and ensures your items reach their destination on time.
Just make sure your freight forwarding service provider manages their operations with a powerful tool like Shipthis.
Shipthis is an AI-driven freight forwarding software that helps with operations management and lets you gain complete visibility of your projects.
If you’re a freight forwarder, discover how Shipthis can help streamline your business by booking a free demo today.