What is a freight forwarder?

If you’re importing or exporting cargo in large enough quantities, you need to make sure you’re following the rules. A freight forwarder can make this easier for you.

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Freight forwarders handle shipping administration, dealing with customs clearance, logistics, and documentation.

But do you need a freight forwarder? And if you decide you do need one, how much do they cost?

What is a freight forwarder?

Businesses can import or export a small amount of goods using parcel couriers with little hassle. But when it comes to bigger shipments, there’s a larger logistical challenge.

That’s where freight forwarders come in – they handle moving cargo for importers and exporters.

For a freight forwarder definition, freight forwarders are essentially the intermediary between the importer or exporter and the shipping company, whether goods are being moved by air, rail, sea, or road (or a combination of these).

Therefore, the best freight forwarders have great access to contacts all around the world, seamlessly getting goods to where they need to go. And you only need to work with the freight forwarder, rather than lots of separate businesses and organisations.

According to gov.uk, some of the tasks that freight forwarders might deal with include:

• customs clearance
• documentation
• cargo packing
• movement of dangerous goods

Some freight forwarders might only specialise in the logistics of moving cargo. Customs brokers then specialise in customs clearance, including commodity codes and EORI numbers.

Think about the needs of your business when deciding which service to use. If you’re confident about moving the goods yourself, you might only want to hire a customs broker.

Why should I use a freight forwarder?

The best freight forwarders simplify a complex process and have expert knowledge on transporting goods.

You might choose to use a freight forwarder to:

• save time and money (despite initial upfront costs)
• cut down on complex paperwork
• get access to shipping and haulage companies that the freight forwarder trusts
• tap into negotiation skills – freight forwarders negotiate with multiple organisations from different countries on your behalf, helping you to cut costs
• tap into expertise – as a busy business owner, you might not be a specialist in moving cargo, but this is what freight forwarders do every day

Are there any downsides to using a freight forwarder?

It’s important to find a good freight forwarder that you can trust, because you’re leaving a complex process in their hands – and if something goes wrong, it’ll affect your reputation.

Some downsides to freight forwarding include:

• you’re leaving an important operation in a third party’s hands – so research your options carefully
• using a freight forwarder will cost you, so balance that cost against time saved and the expertise you’ll have access to
• there might be a number of fees and charges, so get quotes from a few freight forwarders and ask for an itemised breakdown of what they’re charging for
• if you have the expertise and contacts to arrange moving cargo yourself, it might make more sense for you to do so (you might only gain confidence after seeing how freight forwarders manage the process)
• service can differ among freight forwarders, so find out how your needs will be prioritised

How much does a freight forwarder cost?

It’s impossible to give exact costs because it depends on what your business needs. But there are different factors that influence the price, according to NI Business Info:

• type of transport – air is generally more expensive
• distance and destination – if your goods need to go far, or to less common locations, the costs will be higher
• weight and volume – charges are based on weight up to a certain point, then they’re based on volume
• value – some goods, like earthenware and woollen textiles, are charged for on the goods’ value per tonne
• type of contract – your contract with the freight forwarder could be for priced per shipment, or they might offer an annual service charge
• service – if your freight forwarder is also acting as a customs broker, they might charge extra

There’ll usually be extra charges for transporting dangerous goods, perishable goods, animals, outsize goods, and other irregular goods. You also have to bear in mind security for dangerous goods travelling by road.

When you get a quote, ask for a breakdown of all the services, fees and charges you’ll be paying for. That should make it easier to compare charges from different providers.

Where can I find a good freight forwarder?

There are a number of professional bodies for freight forwarding services:

• the British International Freight Association (BIFA) has a member search function
• the International Federation of Freight Forwarders Associations (FIATA) website has useful resources for finding global members

You can also use a freight forwarder quote comparison tool, but make sure you research the results properly.

Are you thinking about using a freight forwarder? Let us know in the comments below.