The logistics industry can be confusing, with many different types of service providers. Two of the most common are carriers and freight forwarders.
Business owners need to know the differences between them to choose the best service for their needs.
Carriers and freight forwarders are similar. They both get goods from point A to point B for a fee. However, each has a different job description and skill set.
This article will look at the two services, how they differ, and the advantages and disadvantages.
Carrier: What’s Their Role?
A carrier’s job is to haul goods from place to place. Carrier’s position includes trucking, rail, airplanes, barges, or other mechanized vehicles.
Carriers need to deal with many details, such as weight, volume, height, and width restrictions for their vehicles. They also need to know how to safely load and unload their shipments and handle paperwork and customs/duties clearance.
Shippers(the people who are sending shipments) hire the carriers. Freight forwarders may also subcontract them to transport their client’s goods.
Responsibilities of Carrier
Some of the most familiar carrier responsibilities are:
- Taking over the goods;
- Preserving the interests during the voyage;
- They were carrying goods to their destination by a suitable means of transport & delivering the goods to the holder of the bill of lading.
- Safe transport of goods
- Deal with paperwork and customs/duties clearance.
- Pick up and deliver shipments on time.
Carriers have a lot of responsibilities and duties. They are in charge of transporting goods, people, and information. Shippers need to have a good understanding of their carriers’ responsibilities and duties to fulfill them well.
Freight Forwarder: What’s Their Role?
A freight forwarder’s job is to ensure that cargo space is available for the client’s shipments. It is their responsibility to find the most efficient mode of transportation for the goods, whether it is a carrier, a private or chartered plane, or a boat.
They also have to deal with all of the details that carriers have to deal with, such as weight, volume, and height/width restrictions.
Freight forwarders can also help with customs/duties clearance and transport documentation.
Importers (the people who are receiving shipments) hire the freight forwarder. Carriers may also subcontract freight forwarders to transport their client’s goods.
The freight forwarder is the middleman between the shipper and the carrier. They take care of all the details involved in getting goods from one location to another.
Freight forwarders use their industry expertise to choose suitable carriers to move goods and negotiate rates. When your shipment needs to change course or go to a different location, the freight forwarder makes the necessary arrangements.
Freight forwarders often work with several carriers to increase their options and network.
Responsibilities of Freight Forwarder
Freight forwarders are responsible for ensuring the safe and timely transport of cargo. They need to be familiar with all the carriers that service their area and know their responsibilities to keep the cargo moving. Freight forwarders need to read and understand shipping documents and have a good understanding of logistics. They should also be familiar with customs procedures and regulations to avoid delays or problems along the way.
Transportation Management
International freight forwarding involves the movement of goods from one location to another, so it’s the freight forwarder’s job to coordinate the movement of goods from the time they arrive at their warehouse through the journey to the delivery.
Documentation Management
At each journey stage, a freight forwarder needs to ensure that the proper paperwork is completed and delivered to the right person. Paperwork includes, but is not limited to, things like:
- Bill of lading.
- Destination customs paperwork.
- Export shipping Bill
- Commercial invoices.
- Insurance certificate
- Letter of credit – if applicable
- Packing lists.
- Dangerous goods.
- And more.
Insurance Management
A freight forwarder will ensure that the goods are insured adequately throughout the transportation process.
Insurance can involve:
- Shipping insurance.
- Export insurance.
- Import insurance.
- Customs insurance.
- And more.
How They Work Together
Freight forwarders and carriers often work together to get shipments where they need to go.
When goods are shipped, the freight forwarder may assign a carrier and help them to complete the necessary paperwork. The forwarder will also arrange for customs/duties clearance and transport documents.
A forwarder may also send shipments directly to the carrier. They will coordinate with the airline to ensure the cargo is loaded and unloaded safely and correctly complete the paperwork.
Freight forwarders and carriers can work together as a single, integrated team. The forwarder will manage the business and take care of the details. They may also do some of the work of selecting and contracting carriers. The carrier will provide the transportation and load/unload services.
The Pros and Cons of Freight Forwarder
Freight forwarders and carriers each have their benefits and drawbacks. A quick look at the advantages and downsides of each will provide below.
Freight Forwarder Pros and Cons
Pros
Industry Expert
Freight forwarders have industry expertise. They know the resources they need to get their client’s goods where they need to go. They are also well-versed in dealing with any obstacles that may emerge. For example, ZggShip is a trusted company with expertise in this industry. More than 12 years of logistics and transportation experience, with various flexible logistics solutions and the ability to deal with problems.
Building Safety into the Shipping Process
A freight forwarder will negotiate with the carrier to ensure that the goods are loaded and unloaded safely. They will also make sure that they made the payment right and that any customs/duties paperwork is correctly completed.
It Costs Less
You aren’t paying extra for a transportation service when using a freight forwarder. The freight forwarder will find the best carrier for your goods and handle all the details. For instance, ShipO Fulfillment Center can save your time and your money. The fulfillment process Quick, affordable delivery as your customers, expected. They are an affordable freight forwarder and fulfillment center that is easy to use and has a quick fulfillment process.
Cons
Loss of Goods
Product loss is a real problem and a significant risk when using freight services. Whether you want to accept this, this is a real problem and a considerable risk. Even though we have a lot of modern technology, no one can predict how nature will act. This situation means that there is always a chance that goods will be damaged or the entire shipment will go missing over the sea.
In this case, if you had also hired a freight forwarding company to package your goods, you don’t have words of how they put the interests in the container. If the forwarding process goes well, the goods will be safe. If it doesn’t, you could lose a lot of money.
Miscommunication Issues
Miscommunication is one of the leading causes of problems when shipping. Hiring a freight forwarder to handle the transportation aspect of shipping, you may find a lot of miscommunication between carriers and the forwarder.
Miscommunication can lead to the carrier not being able to find the shipment at all, and you can get into legal trouble.
Carrier’s Pros and Cons
Pros
Control
You have complete control over shipments when a carrier transports your goods. You can choose the career you want to use and decide which route to take, and you can use a reputable carrier you have used in the past and trust or use a new company. You can also negotiate the carrier’s charges and choose the days the shipment is on the road.
Knowledge
Carriers know more about the shipping process than freight forwarders. They are professionals who have been in the industry for a long time. A carrier can step in if a freight forwarder cannot handle a task.
Flexibility
Carriers can change plans and go to different ports, airports, and warehouses. Carriers offer you flexibility in how your shipments are handled. You can choose to transport your goods by air, sea, rail or road.
Cons
Price
Carriers are typically more expensive than freight forwarders. Carriers have to make money, and they often transport large quantities of goods. Freight forwarders work on smaller shipments and usually negotiate the best deal.
Speed
Carriers typically take longer to get goods where they need to go. Carriers take longer to get goods where they need to go. They have to choose the correct route, and load/unload the shipment at the right place. They also have to negotiate with Customs and Border Protection and may be delayed due to weather.
The Bottom Line: What to Consider?
There’s no one-size-fits-all way to find the right freight forwarder or carrier. As with every business decision, you must choose what’s suitable for your needs.
If you’re finding to save on shipping costs, use a freight forwarder. The fees are usually lower than with carriers. You don’t need to worry about your shipment changing direction.
However, if you want to have more control over your shipments, use a carrier. You set the plan and the timeline. You can also choose a carrier who is good at making adjustments.
It’s essential to choose a freight forwarder or carrier with the experience and expertise to manage your shipments. In the long term, you’ll save time and money.
How to Choose One?
Before choosing either a freight forwarder or a carrier, you should decide what you are looking for in shipping service. If you know what your needs are, you will be able to find the best option for you.
When you already know what kind of service you need, you can start contacting them. You should get several quotes for the kind of service you are looking to ensure the quality of their services. Be sure to consider the prices, services, and experience of the company or individuals you are considering.
If you do find a freight forwarder or carrier who you feel is the right fit for your needs, consider asking for references and calling those references. Check out the service they received and ensure they are who they say they are.
Final Thoughts
Many things go into choosing a freight forwarder or carrier. You should know your needs before you begin the process. You should also consider the prices, services, and experience of the companies or individuals you consider.
Once you’ve decided on the best freight forwarder or carrier for your needs, ensure you have all the necessary documentation. The documents will help you and your business avoid conflicts and disagreements.
If you are looking to save on shipping, you should consider using a freight forwarder. However, if you want more control, you should look at using a carrier.
Whatever you choose, be sure to keep the contract that you sign. After you sign the contract, you are legally bound by the terms and conditions of the company. Make sure to write down and sign any changes to the agreement that need to be made.
Every time you agree to something, you should read the contract carefully. You should also know what you are getting into before deciding to do anything else. So in this article, we tackle the differences between freight forwarding and its benefits and drawbacks.
