The Importance of Freight Forwarders in International Business

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WED | The Importance of Freight Forwarders in International Business | In simple terms, freight forwarders act as travel agents for cargo in the shipping industry. Like a travel agent schedules, coordinates, and draws up the necessary travel documents, a freight forwarder does the same thing, but for cargo. They have the responsibility of mapping out shipment routes, creating connecting information flows within various supply chains.

International freight forwarders have the task of arranging customs clearance and transportation on behalf of the shipper. Without freight forwarders, global businesses will face an enormous logistical burden that can be disastrous to the entire international market’s productivity. 

Let’s talk about freight forwarding. It is a highly specialized niche in supply chain management and logistics, and one doesn’t know about it too much. Freight forwarders are ok to stay behind the curtain while playing as an invisible force that fulfills global businesses’ shipping needs and requirements. However, it is not an automated function. It requires customs expertise, organizational know-how, and hand-wrought, strategic shipping networks. In today’s article, we will share some essential points to why freight forwarders are crucial for any international business. You can view them down below.

They Will Help out with Customs Brokerage

Customs brokerage is a confusing process if a business does not have ample knowledge about it. It involves producing and creating documentation related to customs regulation and laws, which, in itself, requires a wealth of knowledge about international laws and whatnot. Also, businesses will need a license to do the things mentioned above.

Whether it be land, air, or international sea freight forwarding, today’s freight forwarders also act as customs brokers. They also provide consultation related to marking, packaging, potential shipment obstacles, and compliance standards.

They Help out with Inventory Management

Storage and warehouse management are a crucial part of the supply chain management process. It requires the storage of inventory, arrangement, maintenance. However, the process is much more involved and includes other aspects of supply chain management like product production or purchasing.

Some freight forwarders offer warehousing and storage solutions, which can help take any international business load. And allowing them to focus on increasing customer orders rather than worrying about delivering products to their doorsteps. Also, some freight forwarders might outsource warehousing and storage to standalone warehousing companies.

They Have a Vast Amount of Networks

Sea voyages or airplane trips are not the only things in a freight forwarder’s forte. They also create and maintain healthy relationships between themselves and port officials, shippers,s carriers, and other freight forwarding companies. These relationships result in expeditious shipments and also lead to reduced shipping rates.

Without these healthy trade partnerships, it will be nearly impossible to compete with shipping giants, such as FedEx or Ups, small freight forwarding companies. Anyone could also argue that a freight forwarder is only as valuable and reliable as its partners or networks.

They Have Great Customer Service

An excellent freight forwarding company will do their absolute best to fulfill their customer’s needs, adapting their services according to the client’s preferences. For example, door-to-door services will optimize a business’s claim in a compact customer-based solution.

Whenever a company undergoes problems with customs clearance or shipping regulations, a reliable freight forwarder will always sort out any concerns. They will always be one call away and will provide international businesses with suggestions and solutions to tackle overseas shipping problems.

They Help out with Negotiations and Documentation

A good freight forwarding company will ensure that their client’s administrative issues, such as documentation, will be their headache. As freight forwarders have immense knowledge about regulations, customs, international laws, and related documentation, they will ensure that the freight forwarding process goes as smoothly as possible. Such documents include customs invoices, permits, certificates, lading bills, etc.

Negotiating freight rates can sometimes be a double-edged sword. When talking about international trade, a freight forwarding company will have a perfect balance between keeping their partners happy while striking smart deals. Even if it leads to opening themselves to a bidding war involving other carriers. After all, ensuring that clients get the best shipping rates possible is a mark of an excellent freight forwarder.

They Help with Shipment Scheduling

Getting products to the market on-time is crucial in the freight forwarding game. Simultaneously, it might seem like an easy job for a freight forwarder to do such a thing. However, delays can and will happen due to various external reasons. These include increasing storage rates due to the seasonal unavailability of storage spaces in warehouses.

A freight forwarder will ensure that they book cargo space utilizing various modes of transportation. They carefully coordinate with everyone involved in the process, including carriers, manufacturers, suppliers, storage providers, and much more.

Conclusion

It is a freight forwarder’s responsibility to ensure accuracy, good service, and speed with every shipment. They are the backbone for all businesses that deal with shipping products internationally. If you are an international business yourself, it will do you good to analyze its unique requirements and needs. It will let you know whether hiring a freight forwarder is the right choice for you. Also, consider the importance mentioned above so you can make your decision more quickly.