What is Freight Forwarding? Author: tylerg
May 17, 2013

If you are involved in any enterprise that is heavily focused upon logistics, odds are good that you will eventually find yourself selecting a freight forwarder, or perhaps a number of different freight forwarders, to meet your company’s needs. Or, as is often the case, you might be thinking about how to further your career as a freight forwarder after working in a leadership role that has to do with regional or international logistics.

In any case, you must know a great deal about freight forwarders and their function in order to make sure that your partnership with them works out to your advantage. When you use a freight forwarding service, you are contracting a third party in help you manage the logistics of moving your goods or materials from one place to another. The forwarder does not move goods, but instead acts to select carriers and other vendors in order to optimize your supply chain.

What is Freight Forwarding All About?

The goal of the freight forwarding service you select is to facilitate the logistics behind the international transfer of your goods and to do so in such a way that costs and errors are both minimized. Many enterprises that are getting involved in international logistics for the first time will find that a full roster of freight forwarding companies must be developed and maintained in order to meet every logistical need at an optimum value.

As you can tell, this is similar, but different in scope, from the decision to develop your own network of carrier relationships. When you work with a forwarder, that company controls the carrier relationships on your behalf. While this can save you both time and money, it can also lead to less granular control over the specifics of your supply chain.

Upon getting a contract with you, a freight forwarder takes responsibility for at least one leg of the journey that your goods will take from your facilities to their final international destination. In some cases, your freight forwarders might be responsible for helping your goods transit tens of thousands of miles to their final destination. In other cases, the supply chain may be so long and complex that one forwarding service links to another.

How Can You Make Sure Freight Forwarding Services Work Hard on Your Behalf?

Forwarding services generally have a defined “reach” as well as very specific value propositions that may or may not fit your company’s needs at given times. For many small and medium-sized companies, it is therefore necessary to build up your supply chain carefully, cultivating your relationships with a number of freight forwarding experts that you can trust. One way to ensure these relationships are good for you is to execute regular audits.

A smaller freight forwarding service may have features that are extremely valuable to you in a given situation, but that does not necessarily mean that their internal processes and procedures are as uniform, accurate, or effective as a larger service or a carrier. That being the case, it is a good idea to use an established logistics consulting firm to audit your invoices for errors on a regular basis. This will give you data-based tools to revise the terms of your contracts or to “swap out” different elements of your supply chain as your needs evolve.

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