What are Freight Forwarders?
April 1, 2009
A common question that gets asked quite a lot and one that I’ll deal with here at Transportation Logistics is, “What are freight forwarders?”
Essentially, freight forwarders are third party transport and logistics providers. As a non asset based, third party provider, a freight forwarder is responsible for dispatching shipments of cargo via asset-based carriers and books and to arrange the necessary space for those shipments.
There are several carrier types that are used for freight forwarders transportation and logistics companies, which include land based vehicles such as trucks via road or freight trains via rail, waterborne vessels such as ships or container barges and air freight via airplanes.
Freight forwarders are typically known for arranging cargo movement to international destinations, although they also national land transport as well. for this reason they are often referred to as international freight forwarders.
International freight forwarders have the expertise and knowledge that means they are able to prepare and process all the necessary documentation as well as performing such related activities which pertain to international shipments.
A freight forwarder will review such typical information as the bill of lading, shipper’s export declaration, commercial invoice and any other documents that are required by the carrier or of country of export or import and transshipment. Currently, the majority of this information is processed using computer technology allowing for a paperless environment.
Freight forwarders involved with all international ocean shipping that are based in the United States are licensed as Ocean Transportation Intermediaries by the Federal Maritime Commission. In similar fashion, freight forwarders that also handle air freight are often accredited as a cargo agent with the International Air Transport Association (IATA).
Freight forwarders based in the United Kingdom are not licensed. However many of these are British International Freight Association (BIFA) members. UK based freight forwarders consolidate a variety of goods from different consignors together as a single full load for road transport to Europe. This practice is often known as “groupage”.
A number of freight forwarders offer some additional related services such as export packing and case making.
It is worth noting that the regulations regarding the exportation of untreated timber pallets and cases has become increasingly more strict. For many countries an exporter is now expected to provide a special “phytosanitary certificate” otherwise they may risk the additional expense of having their cargo specially fumigated.
We hope that you now have a better understanding of what freight forwarders are and what their function is with regards to the business of transportation and logistics.
