Why do I need a Freight Forwarder?
An interesting question I see earlier this week, and it's one that I've never heard in over 25 years of being involved in the business!
I'm guessing the question was asked on the assumption that if somebody buys DDP or DDU terms, it's all taken care of? No. A Freight Forwarder is still needed, it's just that whoever is the paying customer to the Freight Forwarder changes, but they are still there as a vital link in the supply chain.
In our opinion, we heavily recommend that it's YOU that is the customer of the Freight Forwarder as mentioned in our other articles but, there are so many reasons why a Freight Forwarder is needed.
First and foremost, if it was so easy dealing directly with a shipping line or airline to book freight, Freight Forwarders would not exist. Trust me!
Rates: The buying power of a Freight Forwarder is much greater than the average importer, so the rates we get are much better. Sometimes 50-100% better depending on the route.
Consolidation: Shipping lines do not offer consolidation services. This is something that Forwarders developed and operate, by consolidating clients cargo in one place, to create enough 'pay load' to fill a container. The proportion of costs are spread across each cbm/ton and a sell rate is created which included the freight from port to port, and the added service features either side.
Service: A good forwarder will learn your business, spot trends and recommend alternative efficiency improvements to maximise your profits. Sometimes shipping less more frequently, is better than shipping bulk less often. Quick example is cash flow vs storage costs. More about that in this article here.
Customs & Excise: A Forwarder declares your import or export to HM Customs & Excise for a small fee, pays out the due funds and re-invoices you at net cost! What a nice bunch of people! Shipping lines and Airlines do not do this.
Delivery: How do you want your expensive investment of goods delivered? Protected, wrapped, to FBA Spec and no doubt sitting neatly on secure pallets? Then again, you need a Freight Forwarder to ensure this happens. We may even throw in some photos before it heads off to 'Amazon World' too!
I'm one of those people that tend to try and do things myself. I don't use travel agents or flight centres, I book everything myself direct. Freight on the other hand is a different ball game altogether. Unless you're moving a parcel, a Freight Forwarder is needed.