What is Freight Forwarding?

Freight Forwarding 101

As our world’s economy continues to grow and shift, global shipments continue to increase both domestically and abroad. For some companies, domestic freight is relatively simple but as companies expand internationally, they must choose whether to expand their own in-house shipping functions or bring on a freight forwarding company. Shipping abroad adds complexity. Expanding internally means a larger investment in logistics, technology licenses, and finding personnel with the correct skill sets to keep everything running smoothly. The investment of building or expanding a company’s logistics team is sometimes undesirable, the cost is too high, or companies prefer to keep the focus on running their everyday business.

What is a freight forwarder?

A freight forwarder is a business that organizes shipments for individuals or corporations to get goods from the manufacturer to a customer or a final point of distribution. Freight forwarders specialize in lowering costs and facilitating the logistics of transportation.

What does a freight forwarder do?

The freight forwarder is an intermediate between a shipper and the final point of distribution. While the forwarder does not actually move the freight itself, they arrange various transportation services such as ocean shipping on cargo ships, road transport, and expedited shipping via air freight.

A freight forwarder utilizes established relationships with carriers—air freighters, trucking companies, and ocean liners—in order to negotiate the best possible price to move goods along established trade routes by working out various bids and choosing the path that best optimizes speed, cost, and reliability.

Some companies view international logistics as a task that is too formidable or complex to tackle alone, which makes hiring a freight forwarder the smartest decision.