What Is a Freight Forwarder?
A freight forwarder is an individual or company that can help you navigate the complexities of logistics when it comes to managing the shipment, export, and import of goods. Freight forwarders use their logistics expertise, customs knowledge, and network of shipping partners to help companies ship goods from point A to point B while optimizing shipments for speed and cost.
Freight forwarders come in all shapes and sizes. Smaller forwarders may specialize in just one type of shipment or only a few shipping routes where they have established relationships with local partners. Some may offer shipping services by sea or air, or both. Larger forwarders are essentially global freight forwarders.
Some freight forwarders use their own vehicles and warehouses, but there are also forwarders that operate without owning these assets by selecting the best operators for each leg of the shipment.
For example, Janio specializes in international freight shipping to and throughout Southeast Asia. Its services range from international air and ocean freight across major markets such as Singapore, Malaysia, Indonesia, Thailand, Vietnam, and the Philippines to facilitating imports from countries like the United Kingdom and Australia. Cross-border trucking services between Malaysia and Singapore are also available.
Roles & Functions of a Freight Forwarder
Definition of a freight forwarder, what they do, and the benefits of using a freight forwarding company
If you’re starting to expand internationally and aren’t familiar with the ins and outs of international shipping, mistakes can be costly. Having your shipment held up at customs can wreak havoc on your operations and be difficult to resolve.
Freight forwarders act as intermediaries between shippers and the necessary shipping partners at every step to get their shipments from point A to point B. They can be thought of as travel agents for cargo.
In the process of managing your international shipments, freight forwarders essentially handle customs clearance on your behalf and coordinate and manage your shipments to achieve the most cost-effective results.
Freight Forwarders Navigate Export and Import Customs
The customs process can be complex, especially in regions like Southeast Asia where each country has its own customs procedures and requirements.
Many international freight forwarders provide customs brokerage services, handling customs documentation and procedures in both the importing and exporting countries on your behalf. Experienced freight forwarders are well-versed in the customs processes of these various countries and help ensure your shipments remain compliant.
They will advise you on which documents to obtain when arranging this so that all necessary paperwork is submitted on time. This is especially important in Southeast Asia, where customs can be complex because each country has its own customs regulations and requirements. Working with a freight forwarder that has established regional customs brokerage experience can help ensure your shipments move smoothly from point A to point B.
Especially for new shippers, working with the right freight forwarder can save your company valuable time that would otherwise be spent learning these procedures from scratch. The time saved through this is part of the reason why even more established companies rely on freight forwarders.
Freight Forwarders Optimize and Manage Shipments
Whether your chosen freight forwarder has its own fleet or not, it will advise you on which mode of transportation best suits your current shipping needs and then arrange everything necessary to carry out the shipment through its network of partners. Freight forwarders typically do the following to assist you:
- Select the right carrier for each leg of the journey to ensure the fastest and most economical route—whether by sea, air, or land
- Negotiating bulk shipping rates to get you better prices
- Handling customs documentation
- Tracking cargo status—especially if they have an online portal that handles international shipments
- Troubleshooting – Freight forwarders also step in if there’s a potential issue with your shipment
- Large carriers can provide excellent service to many countries, but at a high cost. To get great service at a reasonable price, you need relationships with several local specialty carriers. Especially if you’re shipping to multiple countries, maintaining relationships with many of these types of carriers can be a challenge.
By working with a freight forwarder, you can benefit from their cost and speed optimizations—which stem from their strong relationships with carriers—without having to build these relationships from scratch.
How to Get the Most Out of a Freight Forwarder’s Services
If this is your first time working with a freight forwarder, the initial meeting typically covers the following:
- They’ll cover everything you need to know about the shipment and answer any questions you may have about the route and your shipment. They’ll also advise you on the key shipping documents you might need, or whether any special documentation—such as permits or licenses—is required for your shipment
- They’ll offer advice and suggest options that best suit your shipment and your current logistics needs
- Your freight forwarder’s representative will also keep you informed about the progress of your shipment or if there is a risk of significant delays.
- Some may also offer technological solutions, such as a shipping portal that provides regular updates on all your international shipments.
It’s also helpful to prepare the following information to make the meeting more efficient and effective:
- Incoterms – e.g., whether you’ve agreed to FOB or CIF terms with your buyer (import) or seller (export)
- Commodity – the type of product you wish to ship
- HS Code (if applicable) – the Harmonized System code used to identify the type of goods you are shipping
- Port of Origin
- Port of Destination
- Quantity – the number of goods being shipped
- Gross and volumetric weight – Gross weight is the actual weight, and volumetric weight is the amount of space the goods occupy
- Dimensions – length x width x height
- Cargo Readiness Date – estimated date when the cargo will be ready for shipment
- Are you shipping dangerous goods (DGR)?
- Commercial invoice and packing list
- Pickup address
- Delivery address
That concludes the information about freight forwarders; we hope you find it useful.