While you’ve likely heard the term “freight forwarder”, like many people, you may be slightly unclear about what exactly they do. The title is often confused with other roles in the import and export industry, including distribution manager or a transport company.
A global freight forwarder assumes some of these responsibilities by overseeing every step involved in international transport. Read on to learn more about everything involved in the role of a global freight forwarder.
What Is the Role of a Global Freight Forwarder?
A global freight forwarder is a company that specialises in arranging cargo on a shipper’s behalf.
They bridge the gap between the shipping customers and transportation services that transport cargo. They do not physically transport cargo themselves. Rather, they organise the flow of goods between two global destinations within a particular timeframe.
A global freight forwarder uses existing relationships to negotiate prices and decide on the most reliable, economical, and fastest route. The majority of their time is spent communicating with all parties involved. They work together to settle any issues quickly and ensure the customer is updated throughout.
A global freight forwarder’s various supply chain services include ocean or air freight.
What Are the Steps Involved in Global Freight?
International forwarding is usually carried out in seven phases. Next, we’ll discuss the role of a global freight forwarder during each stage:
1. Export Haulage
The process begins by moving the goods to the freight forwarder’s processing warehouse. If it’s agreed that the forwarder is accountable for this step, they’d usually make arrangements with their warehouse solution providers and transportation company.
If the consignee (the person financially responsible for receiving the shipment) is accountable, it would be easier for them if the forwarding company included export haulage.
2. Export Customs Clearance
At this stage, the freight forwarder will ensure the goods are approved to leave the country of origin. Items such as flammable liquids and other prohibited types must be omitted from the shipment before reaching the port grounds. The freight forwarder will have a valid custom licence permitting them to declare and submit the required documentation to the authorities so the cargo can exit the country.
3. Source Handling
Source handling includes the inspection and physical handling of goods from the source warehouse to ship. During this stage, different parties are involved, and once the cargo is received and inspected, it’s packed into a container and taken to a port for ship loading.
4. Sea Freight
The global freight forwarder then appoints the best shipping line to transport the sea freight from origin to destination within a particular timeframe. There will be a contract between the forwarder and shipping line company for the shipment of the container.
5. Import Customs Clearance
This stage usually starts before the freight arrives at the destination country. This stage must be completed before the load leaves the warehouse.
The port authorities will examine the customs documentation to ensure it is in order. This task is performed by either the freight forwarder, an agent, or by a customs house adviser chosen by the consignee.
6. Destination Handling
More cargo handling will take place before the goods can be released. This step involves processing the goods from the vessel to the shore, then from the sea harbour to the freight forwarder’s distribution warehouse. The container will be unpacked and the goods scanned then prepped for the consignee’s collection.
The freight forwarder will manage the payment of multiple destination charges, which must be paid to release the cargo.
7. Import Haulage
The goods are transported from the import warehouse to their final destination during the last stage. This stage is performed by the forwarder or a local transportation agency prearranged by the consignee. The goods will be delivered to the arranged address, and the consignee will be responsible for offloading the goods from the transport.
The Role of a Global Freight Forwarder
A global freight forwarder ensures your goods are taken from their source destination and transferred by ocean or air to the desired international destination. They are the intermediary between the shippers, carriers, and all entities involved in between, saving businesses time, money, and stress. Their experience, knowledge, and close relationships developed over time put them in the optimal position to negotiate deals and make the whole operation more cost-effective.
Due to the fast growth of e-commerce, businesses are increasingly relying on international freight forwarding services. Should you need to work with a global freight forwarder one day, a basic understanding of what they do will help you make informed decisions. It’s always best to work with a reputable and established freight services provider to avoid struggling through the process alone.