Increasing trends of international trading benefit the freight forwarding business. Actually, the business is not limited only to international trading activities. Instead, freight forwarding business also includes local trades. Now the question is, what is freight forwarder. It refers to a company that acts as an intermediary between two companies, namely, a company that makes shipment and another company that becomes the final destination for the goods. Freight forwarding business covers ocean freight, air freight, road transport, and rail freight, depending on which mode of transport chosen by the company that makes the shipment.
There is no confirmed information on when the freight forwarding business began. According to some online sources, an official institution was first identified in Canada in 1948, when the state established its Canadian International Freight Forwarders Association (CIFFA). Some important insights from the organization include the importance of coordination, regulation, and agreement upon the best practices to make sure that the goods are shipped in a timely manner.
Freight forwarders may or may not do the shipping on their own. Those who have the required modes of transport can do the shipping. However, freight forwarders mostly work on based on trusted contacts. They negotiate the best price possible with a number of shipping specialist and trucking companies. They can collaborate with transport specialists that offer regular departures or by charter and agree on terms.
In simple words, freight forwarders serve as a third party in triangular operations, a company that ships the goods (manufacturer), a freight forwarder (intermediary), and a company that receives the goods (final customer). The three companies may be located in the same country or in different countries. The freight forwarding company deals with all the complicated operations related to the shipping activities, including documentation, VAT settlement, and many others.
Freight forwarding is a growing business. The competition in the industry is even bigger that it once was. The most important principles of this business are cost-effective and timely transfer of goods from the manufacturers to the final customers. What is freight forwarder doing is managing the logistics in the best possible manner to make sure that the goods arrive at the destination on time. Successful shipping means having the right tools and choosing the right modes of transport.
To succeed in the business and to stand out in the crowd, the freight forwarders need to provide value-added services. The following tips may work:
Offering custom advices for the customers is a great way to make your company stand out in the crowd. The freight forwarding business will grow with time, so that the company must be able to keep up the trends to maintain the customers’ loyalty.
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