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Freight forwarders: Why you should use them and who are the best

Direct import is one of the quickest and most affordable ways to acquire products from China, India, and other manufacturing countries. Getting items directly from manufacturers also makes it possible for eCommerce sellers of any size to cut costs on generic items or sell private label goods, which is increasingly needed to gain an edge on crowded marketplaces.

However, it takes the right resources and infrastructure to import on your own, considering significant hassle in the form of logistics processes, paperwork, and regulations.

Freight forwarders step in to take this process out of your hands by acting as an intermediary between suppliers or manufacturers, shippers and transport, and customs, to help you move goods as quickly and as efficiently as possible.

Not all freight forwarders are created equal, and many are considerably more expensive than doing it yourself. However, a good freight forwarder has a lot to offer, because they allow eCommerce sellers to cheaply import goods, which usually amounts to significant savings over local manufacturing or importing through an intermediary (or building the complex infrastructure to import directly yourself).

Understanding the value and return you will see from using a freight forwarder will help you determine if it’s right for you and your eCommerce business.

Benefits of using a freight forwarder

Freight forwarders work as intermediaries, taking most import processes off your hands. There are several benefits to this, including that sellers no longer have to handle customs paperwork and import regulations.

1) Better efficiency for freight import and logistics

Most freight forwarders will help you find and select the best, fastest, or most cost-effective solution for import and transport, depending on your preferences. Freight forwarding companies take care of the import and logistics across air and ocean freight.

Even if they recommend their standard services, these are likely to offer significant savings of both time and money. They have the experience needed to make smart choices, will handle the paperwork, pay fees reliably, and deal with any issues that might pop up.

For example, your freight forwarder will handle risk assessment and management, warehousing, international payment solutions, and direct communication with your supplier or manufacturer. This all contributes to speeding up the process.

2) They will handle customs and import paperwork

Your freight forwarder will handle all ancillary services including documentation for:

  • Cargo Insurance
  • Customs Clearance & Paperwork
  • Non-vessel operating common carrier documentation
  • Bills of lading
  • Warehousing documentation

Because documentation varies a great deal depending on your country of export and port of import, having a freight forwarder to handle everything for you simplifies the process, while ensuring you don’t face fines or issues from missing paperwork.

3) Get cargo insurance and protect yourself against lost/damaged goods

Insuring your goods before import protects you and the freight carrier. While it’s often difficult and expensive to insure goods on your own, most freight forwarders include complete insurance as part of their standard package deal.

4) Achieve faster fulfillment warehousing

A good freight forwarder will move your cargo from your manufacturer directly to your warehouse, handling all the details in between (including warehousing where necessary).

With established channels, existing relationships with every party involved, and experienced teams to handle paperwork, your freight forwarder should be able to cut days or even weeks off the import process.

Best global freight forwarders

While the best freight forwarder will depend on your specific needs, budget, and eCommerce shop – as well as the countries you import from – the following are among the best available.

Each of these companies is a large and well-established freight forwarder. You may be able to save by choosing a less well-known solution, but this will come with risks as well.

Flexport

Flexport offers air, land, and sea freight forwarding with a strong software backbone that provides complete transparency throughout the shipping process. Flexport provides useful visual alerts, real-time tracking and transport management, plus extremely transparent rates.

Flexport is relatively new to the industry, having been founded in 2013, but has since grown to 9 offices around the world to serve a truly global audience.

Flexport has much to offer for eCommerce sellers of all sizes, thanks to their modern take on freight forwarding, accountability, and transparency in their processes.

Freightos

Freightos is a freight service intermediary between eCommerce sellers and freight companies of every type. They work with more than 75 top providers to ensure global coverage for all eCommerce sellers. Their services include import/export, FBA prep, warehousing, and much more.

For most sellers, the big advantage of going with Freightos is a quick and easy way to compare and connect with solutions, even smaller freight forwarders, so you can find a quality solution in less time. Freightos also offers a complete range of software for comparing options, tracking shipments, managing imports, and much more.

Kuehne + Nagel

As one of the world’s largest freight logistics companies, Kuehne + Nagel is able to offer a complete freight forwarding and logistics solution for eCommerce and retail.

Kuehne + Nagel focuses on providing modern technology solutions for improved and customized freight handling, including inventory tracking and consolidation, break-bulk and cross-dock facilities, logistics automation, box and piece picking, co-packing, home delivery, and reverse logistics.

With over 125 years of industry experience, as well as a wide partner network, plus a strong focus on providing green solutions Kuehne + Nagel has a lot to offer for most eCommerce sellers.

DB Schenker

With 140+ years of experience as a global freight forwarder and supply chain management solution, DB Schenker is one of the oldest and most experienced freight forwarding solutions you can find. They are a full end-to-end solution, with a large global reach.

DB Schenker offers air, ocean, and land freight, ideal for importing from Asia or from South America. DB Schenker’s solutions also extend to customs clearance, pickup from suppliers and fairs, warehousing, co-packing, fulfillment, production supply, along with trade advisory in handling trade documentation, comprehensive risk management, and transportation compliance.

Sinotrans Limited

Sinotrans Limited is China’s largest logistics service and one of the largest freight forwarders in the world. They are able to offer a complete package for eCommerce sellers of every size.

Sinotrans provides completely scalable services, including sea, air, and land freight, and a range of ancillary services including booking, cargo delivery, collection, CIQ declaration, haulage, distribution, storage, and more.

UPS Supply Chain Solutions

UPS is one of the world’s most well-known logistics suppliers with one of the largest networks of any competitor. Their freight forwarding solution includes ocean and air freight, with online tracking, documentation, cargo insurance, and a service specifically designed to speed up the import process.

UPS also works to help calculate import fees and customs in advance, scales from small (less than one shipping container) to enterprise-level imports, and handles import-to-door where desired.

How to choose a good freight forwarder

While there are dozens of freight forwarding solutions, it’s important that you choose an option matching your eCommerce store needs and expectations.

For example, if you need fast import solutions with all the bases covered, you should look for that. If you want a budget solution, you should focus on that.

You also have to cover your bases to determine what the freight forwarder actually offers, what they charge, and why.

Licensed for ocean and air freight handling

Any freight forwarder must be licensed with the FMC (Ocean) and IATA and TSA (air) or as an NVOCC (Non-vessel operating common carrier) where applicable. You should be able to request and see this licensing at any time.

Years of experience with freight forwarding

Check how many years the freight forwarder has been in business, their staff size, number of offices, and their global partnerships.

Larger companies can deliver more and more quickly and can frequently do so more efficiently by leveraging their network. Smaller freight forwarders may have advantages as well, but you should examine them closely before signing a contract.

Port-to-Door full-service solutions

The smaller your eCommerce company, the more likely it is you need a port-to-door solution with potential warehousing and logistics in between. A full-service solution like DHL or UPS will move your inventory from the supplier right to your door, taking every other step off your hands.

eCommerce inventory inspection and packing support

Does your freight forwarder support specific retail or eCommerce solutions? For example, you may be able to request inventory inspection, inventory consolidation, or even packing and reboxing depending on the solution.

Freight warehouse solutions

Do you need warehousing between initial pickup and delivery? What about at the port? Will your freight forwarder offer this if needed?

Transparent Pricing

Nearly all freight forwarders will offer custom quotes based on your company size, volume of import, location/destination, and the complexity of regulations surrounding the product(s) you are importing.

However, you should be able to request and receive clear quotes, understand what the total import will cost (including customs fees, storage at port, import duties) and have a representative or agent who can help you understand fee structures. This is often a problem sellers run into, and end up having to cut into profits when an unexpectedly large bill comes up.

Ask:

  • How much does insurance cost? What is included
  • Do rates fluctuate seasonally?
  • Do you offer flat rate? How do you determine pricing?
  • What volume commitment do I need to reduce costs?
  • How much does document preparation and AES filing cost?

Export compliance

When you hire a freight forwarder, you want them to handle compliance. However, it’s legally still your responsibility. Check and ensure that your freight forwarder is competent enough and has the resources to manage compliance in any country you’re importing from or exporting to.

Freight forwarders can save you a considerable amount of hassle, making imports from cheaper manufacturing countries like China within reach for even small eCommerce sellers. With large global logistics networks, a rich knowledge of industry standards, regional legal restriction and compliance issues, and the ability to leverage networks to reduce the cost and time of import, freight forwarding is often the best and most efficient way to get started with importing goods, whether direct from manufacturer or a supplier.

Remember to review your options, control costs, and ensure your freight forwarder meets your needs and budget before committing.

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