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A freight forwarder is a person who facilitates shipping of perishable or non-perishable goods for a third party. He may handle small personal shipments for individuals or small companies or negotiate the transport of pallets, crates, or shipping containers for large commercial or industrial firms. His services may include arranging transport of goods domestically, internationally or both. He may work as an independent contractor or as a staff member of a shipping company.
There are various reasons a consumer or company may choose to use a freight forwarder for its shipping needs rather than personally or internally arrange the terms of transport. The major cause often involves negotiating the best rate for services. A successful freight facilitator normally has strong contacts within the shipping industry and is often aware of options not available to the general public. These commonly involve knowledge of shipping sources that have room for additional freight on a vessel bound for a specific destination. Another option ordinarily not available to those without industry connections is a reduced shipping rate previously negotiated with the forwarder.
Upon initial contact, a freight forwarder customarily gathers basic information about the shipment. The main factors for consideration normally include if the merchandise is perishable or non-perishable and if the goods have to cross international boundaries. Other important issues concern the size and weight of the shipment and how soon the goods have to reach the destination.
Based on the shipment information he has gathered, the forwarder researches the available shipping options. These usually include determining if rail, water, air, or truck transportation is the best choice for transport. Deadlines for arrival and the perishability of the goods also strongly affect which option is best. He normally tries to keep similar goods going to the same general geographical area together.
Good record maintenance is imperative to be successful in this position. Keeping track of rates, damaged goods incidences, and shipping information on multiple companies is essential to keep customers happy and maintain profit margins. Preparing detailed customs documents and legal papers is also a normal part of a freight forwarder’s job.
A competent freight forwarder typically has well-developed analytical skills and is proficient in negotiations. His success is highly dependent on repeat business, so successfully expediting a customer’s first shipping request is important. The shippers with whom he deals must be comfortable with his integrity and feel they are getting fairly compensated for their services.
No formal education is normally required for this position, although good communication skills are generally a prerequisite. Knowledge of domestic and international shipping options and related rules and restrictions is often a requirement for the job.
Freight forwarders are not able to negotiate or sign contracts as mentioned in this article. Only licensed NVOCCs are able to sign contracts.
Freight forwarders are allowed only to pass through the underlying freight cost from the provider to the shipper and charge a flat fee for their services which must be disclosed. It is all transparent.