News & Press

June 5th 2024

Rogers and Brown

Written By: Wallace Hester, Director of Sales at Rogers and Brown

“The foreign freight forwarder is the indispensable link in international transportation and cannot be eliminated or replaced by any other traffic arrangement or scheme.” 

This statement is a direct quotation from Alfred Murr’s Export / Import Traffic Management and Forwarding, Third Edition, 1974 (Murr-18). Wow! 50 years ago, a lot has changed in the shipping world and the forwarding business, but the core role of a forwarder has not – the “truly indispensable” part remains – even facing the onslaught of technological solutions that claim to fulfill many of the traditional forwarders’ functions. However, other capabilities, knowledge, and expertise are still required to facilitate transportation for international transactions. The key component is transportation (… along with traffic arrangement, documentation support, and handling Customs formalities). This article goes into further detail on transportation, specifically from the role of a freight forwarder.

Evolution of Freight Forwarders

The natural progression of freight forwarding led to forwarders not just handling traffic and transportation performed by other carriers, but also selling the actual transportation. The forwarder has the capability to combine the buying power of many smaller/medium shippers or buyers and provide the same transportation services the shippers and buyers could buy but at a reduced rate.

Thereby allowing the forwarder to better handle the transportation, have a revenue stream from serving as the carrier, and, most importantly, bring greater value to the overall service for the shipper and buyers. To this effect, most international freight forwarders these days also operate as ocean carriers, air carriers, truckers, and even rail carriers. Generally, when the forwarders are selling transportation, it is as a non-asset-based transportation intermediary – a more readily used term would be “brokerage”…..brokerage of transportation.

Services Offered By Freight Forwarders

A freight forwarder will broker a trucking service, ocean service, airfreight service, and everything in between to support their clients’ transportation transactions. Along with the actual movement of goods, there is freight handling done by forwarders (by their own people or third parties) such as warehouse functions and shipment consolidations/deconsolidations (finding freight savings though comingling of goods, whether all for one party or for multiple parties in a shared lane).

Most commonly, freight forwarders provide actual transportation services as licensed entities in the form of a non-vessel-operating common carrier [NVOCC], an Indirect Air Carrier [IAC], and a truck broker acting under the authority of the FMCSA. In this capacity, freight forwarders are able to offer specific transportation services potentially from door-to-door throughout the world. Please note the following transportation functions provided regularly by freight forwarders:

Transportation Functions Provided by Freight Forwarders:

• Trucking / Drayage / Cartage
• Ocean Freight
• Airfreight
• Rail Transportation
• Specialized Transportation
• Freight Consolidation / Deconsolidation
• Warehousing Handling – storage, cross-docking, distribution

Advantages of Using Freight Forwarding for International Transportation

Shippers and buyers have the choice in the selection of their international transportation providers. Larger entities may work directly with carriers because their volumes will afford them the attention to obtain special pricing. In our dynamic transportation world, carriers seem to be less and less interested in actually supporting the service needs of the cargo owners. So, the forwarder offering transportation functions gives shippers and buyers avenues they cannot find when dealing directly with carriers, especially those with smaller volumes.

In utilizing a freight forwarder to procure transportation, the shipper/buyer will get attention, and they should receive competitive rates. They will also have the capability to use the same provider to conduct other forwarding services required for an international shipment: booking, traffic management, overseas coordination with supplier/buyer and handling agents, documentation, tracking, and any other particulars required. There will be one provider and, subsequently, one invoice for settling financial obligations.

Back to the writing of Mr. Murr, “In conclusion, then, the foreign freight forwarder not only facilitates “free freight flow,” but also is the irreplaceable link between the trading nations of the world, a most experienced coordinator of freight services, an ambassador of good will, and a specialized purveyor of first-class ability” (Murr 22).

Do you have more questions about Freight Forwarding?

Check out Freight Forwarding Functions to discover what a freight forwarder is and the services that they offer.

Take a look at the Freight Forwarding Cost Breakdown for information about freight forwarding costs and how to compare different prices and fees.