As the Internet opens up global markets, more and more people are considering starting an import or export business and are looking into selecting a freight company for the first time.
This can be baffling as the world of international freight is highly complex and the newcomer needs to be aware of some of the pitfalls associated with freight forwarding.
The main role of all freight services companies is, of course, to help importers and exporters transport their goods. But with varying requirements in each country and with many different transport options and routes to choose from, it is vital that you choose the right freight company to suit the specific needs of your business.
To get the most out of your freight forwarding company, there are some simple tips and strategies to remember.
Firstly, avoid the common mistake of selecting your shipping company on price alone: Using a freight company can cut your costs because as they arrange for the transport of large numbers of consignments, they can consolidate loads going to a single destination. A freight forwarder will be able to offer lower freight rates than you can negotiate with carriers yourself. Of course, you should get quotes and compare costs from a number of freight forwarding suppliers to find the best level of cost and service for you – but do be aware that that the lowest quote may not be the best option. Check out the level of service carefully too. And watch out for any surcharges and additional fees that may not be immediately obvious. If you are new to the world of international freight, it will also be important that you feel that the shipping company will provide a guiding hand.
Make sure you use a freight services company that is a member of BIFA: There are thousands of freight forwarding companies, so to sort the wheat from the chaff, use the freight forwarding trade associations and in particular the British International Freight Association (BIFA) to draw up a shortlist. This is a membership body representing 1200 UK freight forwarding companies in the UK. BIFA and the International Freight Forwarders Association (to which BIFA belongs) have codes of practice to which all member freight forwarding companies must comply, so this can help avoid problems and provide reassurance that the shipping company you select is of high quality. The freight transport trade associations can also help ensure that any disputes between freight companies and their customers are quickly resolved.
Check relevant experience of shipping companies: To draw up your shortlist, look for freight services companies with experience of the particular routes and goods your business is dealing in. Ask for references from businesses with similar freight transport needs. It is particularly important that the shipping company you select has good experience of the routes you need and a good network of overseas agents. Also check whether your freight services company understands the specific needs of your product type, such as whether it requires refrigeration. This is obviously very important for perishables and food, for example, but also bear in mind the potential impact on your product of different climates. For example, if you are exporting to Scandinavia, have you thought about the possible effect of frost? And if you are involved in China import, do you know what specific paperwork your import products will need?
Take advantage of secondary services from shipping companies: Many freight services companies offer a wide range of additional services and logistics, including completing customs clearance paperwork on your behalf, and paying any taxes and duties owed. They also cover off any other documentation issues, such as Bills of Lading and insurance. Many freight forwarding companies also offer help with inventory management or supply chain management.
Some freight transport companies can also help with collecting products from multiple locations or updating your customer about the status on the freight delivery.
These extra services from your freight services company can help save your business time and money so do check out what is available.
Provide full and accurate information: When you choose to use a freight forwarding company, make sure you provide them with full and accurate information. The key thing to provide to your shipping company is a copy of the commercial invoice and the tariff classification for your goods (unless you’ve asked your freight services company to classify the goods for you.) If you get it right first time, it will make your freight transport go more smoothly.
Check document turnaround time from the freight services company: How long will it take the shipping company to turn around key documents? It is important that this is fast and streamlined, as time is money – your money!
Use your shipping company for advice: You can use your freight services company as a source of information and advice about international trade. Many shipping companies have a wealth of experience, so tap into this valuable resource and make your freight company a true business partner.