What is a freight forwarding company? If you have this question in mind here is your answer.
Also called a freight forwarder, a freight forwarding company is responsible for the shipments of goods or products from the manufacturer or producer to a customer, corporations, small/medium business owners, or the final destination of distribution. A freight forwarding company acts as an intermediary between the manufacturers and the customers or clients to transport goods.
Freight forwarding companies do not necessarily carry out the shipment itself. They have agents who offer transportation means such as sea/ocean freight, air freight, rail freight, and road shipment. They liaise with these transport companies to negotiate the best prices and fastest routes as required by the customers.
What are the Services of a Freight Forwarding Company?
- Customs Clearance
- International export and import documentation
- Insurance
- Packing of goods
- Storage/warehousing
- Inventory management
- Transportation tracking
Freight companies play a crucial role in the global supply chain because they help customers import and export goods. It is essential to know that freight companies do not physically move your goods. Instead, they help the manufacturers and customers by dealing with all the tedious administrative aspects of logistics and ensuring that goods land safely at their last destination.
One may wonder if freight companies work since they only act as intermediaries between the manufacturers and customers. Well, freight forwarding companies are helpful in lots of aspects. For instance, they build strong relationships with officials at ports worldwide, negotiating the best price for you.
What are the Advantages of Using Freight Forwarding Companies?
Working with a freight company has a range of advantages for businesses who organized and transparent in their business dealings. A freight forwarding company relies heavily on excellent customer care, strong interpersonal skills, and building relationship with carriers. Some of the advantages of working with a freight forwarding company include:
1. Organization and Maintenance
Every business that wants to last long in the market should strive for organization and maintenance in their supply chain. Logistics companies sometimes may not offer the transparency and monitoring you need for your goods. If you lose your shipment, it may take endless calls and tours of different departments to get the correct answer.
However, if you use a freight forwarding company, they use their strong network to trace the problem to its root and offer feasible solutions.
2. Low Cost
One of the main advantages of freight forwarding companies is that they know how to negotiate the best and lowest deal with carriers. They sometimes go above by bargaining with other individuals or companies who want to send goods through the same freight company.
When freight forwarders do this, they evaluate the different companies’ goods to see if they can be in a single shipment method. This approach cut down costs on both sides, making everyone win.
3. Extensive Knowledge about the Business
Freight forwarding companies have rich expertise and long years of service in the business. They are also familiar with foreign laws and policies and have the most updated information about several other countries’ customs rules, helping you take care of all the required paperwork, payments and handling other taxes. This way, they advise corporations on different shipment modes across all international borders and any changes, preventing customers’ goods lying around in the dock unattended.
4. Fast Delivery
Freight forwarders ensure that all your goods meet the laid down requirements and that all your shipping documents are complete and in order. Freight forwarding agents or firms also prepare special documentations on behalf of the shipper.
5. Documentation
The administrative aspect of shipment is enough to weigh anybody down. The supply chain requires loads of documents like letters of credit, bills of lading, receiving reports, inventory reports, carrier waybills, and customs invoices. Thankfully, forwarding companies take on this work with no hassle.
6. They Offer Trade-related Services
Many freight forwarding companies also offer some special services for companies. These include:
- Bill of landing
- Documentation needed for shipping
- Insurance services
- Bank papers for the release of payments
- Products sourcing
- Warehousing
- Distributing
- Packaging and Unpackaging
- Distributing
- Organizing
What are the Criteria for Choosing a Freight Forwarding Company?
- Services offered
- Delivery Destination
- Experience in the business
- Your business demands
- Price
- Network in the market
- Customers’ experience
With a range of freight forwarding companies working with different companies, choosing the right freight forwarder can be difficult. Below are some of the best freight forwarding companies that offer the best services.
What are the Documents Required of a Freight Forwarding Company?
- Bill of landing contract
- Certificates of origin statement
- Commercial invoice
- Export License
- Certificate of inspection
- List of export packing
- Declaration documents of the shipper/shipper
Without the above documents, your goods can not reach you or their final destination.
The Different Stages of Freight Forwarding
The shipment of goods goes through different phases and processes. These are:
- Export haulage: This stage phase involves transferring the goods from the producer or manufacturer to the forwarder’s warehouse.
- Export customs clearance: This stage requires clearance in the country where the goods are produced.
- Origin handling: This includes unloading, examining, and evaluating the goods against the booking documentation.
- Import customs clearance: This is the stage where the concerned authorities check for the required paperwork.
- Destination handling: At this stage, your goods are reviewed after they reach their destination.
- Import haulage: Your goods are moved from the warehouse to the final destination.
The Top Five Freight Forwarding Companies
1. DHL
DHL supply chain and international forwarding offer forwarding services in Europe, Africa, Russia, and the middle east. The company’s competitive edge over others has been a fast and reliable delivery of shipment. Besides, DHL is the first logistics provider globally catering to over 220 countries and delivering over 1 billion parcels every year. Aside from transportation and warehousing, the company provides industry-specific solutions to make logistics seamless for their clients worldwide.
Some of their services include freight management, transport management system, warehousing, customs services, freight security, supply chain management, air, road, and sea shipments.
The company continually keeps innovating new ideas and means to give their customers the best experience. One of their latest innovations is the parcelcopter. The company is the first to integrate a drone delivery service into its supply chain. A trip that would take 30 minutes over a distance of eight kilometers took the parcelcopter eight minutes to deliver 130 shipments.
2. DSV
DSV is a Danish global transport and logistics company offering freight services worldwide by air, ship, and road. The company was established in 1976 and has since delivered top-notch services to its customers. The company deals mainly with road transport networks within Europe, North America, South Africa, international air and ship forwarding business.
Some of their services include:
- Track and Trace
- Purchase Order Management
- Warehouse Management
- Lead Logistics
- Customs Clearance
- Cargo Insurance
The company focuses on giving customers a good experience by tailoring the services to suit their (customers) needs.
3. Expeditors
Expeditors is another global logistics company headquartered in Seattle, Washington. For over 40 years, the company has been relentless in providing logistics solutions for its clients. With unified technology systems integrated through a global network of 176 district offices and over 60 countries on six continents.
The company pride does not own any aircraft, ships, or trucks for their freight services. As a result, this makes them highly flexible when it comes to supply chain management. Services include supply chain design and optimization, order management, fulfillment, warehousing, customs brokerage, air, sea, and ground transportation. You can find DSV nearest location to you on their website.
4. Hellman Worldwide Logistics
Headquartered in Osnabruck, Germany, Hellmann Worldwide Logistics SE & Co. KG is a global logistics services company. Founded in 1871 by Carl Heinrich Hellmann, who used a
horse-drawn cart to deliver packages in and around the town of Osnabrück in northern Germany.
Today, Hellmann has established itself as a reputable logistics company with a worldwide network of 20,500 people in 489 branches in 173 countries. The company delivers more than 10 million shipments per year. Some of its services include contract logistics, insurance, security, technology, e-commerce, road, air, rail, and ship transportation.
The company offers the right solution for the complex logistics customers’ needs and requirements while relying on up-to-date digital services for enhanced transparency, reliable and efficient supply chains.
5. DB Schenker
DB Schenker deals with supply chain management and logistics solutions. The company handles everything that has to do with logistics to a customized shipping solution. DB Schenker team provides a range of supply chain consulting services for clients in the automobile, aerospace and defense, consumer goods, battery, beverages, health care, recyclables, special transport, and trade fair logistic industries.
The services include e-commerce solutions, fulfillment logistics, lead logistics services, and intermodal transportation. The company’s competitive edge stands at providing time and cost-optimized services for general cargo, partial loads, and full loads.
Summary
Freight forwarding companies play a considerable role in the supply chain of businesses. They offer a range of services such as transportation of goods from one location to the other, cargo documentation, bargaining, product sourcing, and warehousing. In essence, they help business owners by doing all the hard work at affordable prices.