What is a freight forwarder and do I need one to export goods?

The role of freight forwarding in international trade

If you currently engage in international trade, or are considering doing so, you will have no doubt come across the term ‘freight forwarder’. If you are not sure what that means, in simple terms, a freight forwarder helps companies move their products from A to B in the most efficient and cost-effective way.
Freight forwarders contract with the most appropriate carriers – airlines, shipping lines or hauliers – to organise the seamless transportation of goods. They use their expertise in logistics to determine the best way to move goods, dependent on the nature of the goods and their destination – among other things.

What services do freight forwarders provide?

Moving goods from one country to another can be complex and involves more than simply moving consignments. Freight forwarders should be able to help with the following aspects of exporting your products:

• Logistics
  Selecting, contracting with, and managing the most appropriate modes of transport to move your goods, they may arrange warehousing where appropriate.
• Customs clearance
  This requires completing customs paperwork and paying any taxes or duties owed. Most freight forwarders will be able to do this on your behalf or have an agent they can suggest.
• Shipping documentation
  A freight forwarder will also be able to help with other documentation that you need. It isn’t just documents such as Bills of Lading or certificates of shipment. They can help produce Certificates of Origin, health certificates, technical certificates, export licences or presentation of Letters of Credit.
• Insurance
  Insurance is vital for mitigating the risk of exporting and many freight forwarders will be able to offer insurance against loss or damage

Why use a freight forwarder?

There are lots of advantages to using the services of a freight forwarder, not least of which being their expertise in this area that can be very complex and bureaucratic. They also have the contacts and buying power to secure much more favourable rates than you are likely to be able to achieve yourself.
Bear in mind though that you will need to do your due diligence as freight forwarding is not regulated so, in theory, anyone could trade in this area. They also don’t have any control over scheduling as this is the responsibility of the carriers that they contract out to or check with BIFA.org.

Do I need to use a freight forwarder?

No, you can choose to oversee the whole process yourself, if you prefer. However, the vast majority of companies trading internationally do use them because it makes things much simpler and allows them to take advantage of their expertise and contacts.