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How To Choose A Freight Forwarder

How To Choose A Freight Forwarder

Sir Mike Jukwe, Registrar, CRFFN

When it comes to international freight forwarding and transportation, deciding on the right freight forwarder is like choosing the right supplier, vendor or accountant; you are choosing a partner that will help your business succeed. Your freight forwarder should be a trusted partner for your logistics needs, that is, if they are doing their job right.

In this fast-changing world which is highly reliant on supply chain optimization, cost efficiency, timeliness, and consistent service; shippers, importer, exporters and others involved in the supply chain must make a determination on which freight forwarder to select for their international and domestic logistic needs.

The major problem is that all freight forwarders claim to be great. But they can’t all have the best, most dedicated and knowledgeable employees. They can’t all be negotiating the best rates for the service provided. One could spend a career sorting through forwarders to find the ones who actually do what they say they will. Or, you can ask yourself some questions to quickly separate the mighty from the merely mediocre.

The size of your company shouldn’t determine the size of your freight forwarder. The size of your freight forwarder is defined as a combination of volume shipped, revenues and the number of employees. Many large companies use small freight forwarders and many small companies use large freight forwarders. The following tips below should help you in selecting the right freight forwarder for your company.

  • Understand your internal requirements

 Know what you specifically will need before you even begin looking for a forwarder. Determine what mode of transport and what specific services you will need and what volume you plan to ship before contacting a forwarder. This is the “help me help you” part that the forwarder may say to you if you don’t come prepared.

  • Research their industry

Know what your forwarder can and cannot do for you. Know what you are responsible for and what they are responsible for. Read various blogs, regulations, industry terms, international treaties and anything else required for your shipments. What area of logistics do you really need?

  • Can they handle multiple types of shipments?

You may only need to import using ocean freight from China now, but what if you needed to import from Vietnam using air freight, or export to Dubai using RORO or Break bulk service for oil drilling equipment? Do they have the experience, know-how, and partners around the world to handle your shipments?

  • Do they have the experience you need?

There are many modes of transport, commodities (e.g. garments, machinery, cars, food, garments, chemicals, perishables, hazardous, etc), regulations and origin/destinations. All freight forwarders cannot handle all of these combinations. For this reason, ask potential forwarders what experience they have in your type of shipment. Usually they should be able to bring up an example of a similar shipment they handled for someone else.

  • Are they a member of any trade associations or freight forwarding networks?

Joining reputable freight forwarding associations such as WCA requires financial strength, operational efficiency, integrity and many other requirements. If a freight forwarder is a member of a reputable association, the chances of them handling your shipment with care and diligence is higher than if they were not a member. It also shows they have financial strength because there are only a handful of legitimate, quality freight forwarding networks that really vets their members.

  • How will they manage your operations/shipment?

This relates to who will be your point of contact for submitting documents, coordinating the shipment and who to ask for when there is a problem. This may all be one person who is dedicated to handling your shipment A-Z or several people, each with defined responsibilities for your account. Will communication updates be via telephone, email or automatic web tracking?

  • Ask if they have a network of agents in your destination country

This can be vital for any DDU, DAP, DDP shipments and also if your customer overseas has any unforeseen issues such as a port strike, customs issue or other delay. Their destination agent can help smooth out many of these issues.

  • Put together a checklist of requirements

This includes everything from your time frame on when you want to begin, objectives such as speed of delivery, commodities being shipped, special packaging requirements, terms of sale (incoterms), volume, etc.

  • Do they have multiple service contracts?

This is important when space availability on a vessel, airline or trucking company becomes an issue and you need an alternative. For example, do they only have a relationship with Maersk, Turkish Airlines, or SAIA? Or do they have relationships with multiple ocean, air, and land carriers?

  • Does the freight forwarder have cargo insurance?

This is important as they should be able to issue insurance policies for your shipments in case of theft, damage, or loss.

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