Definition: Freight forwarding is an intermediary that provides a wide range of logistics services to move certain cargo from its point of origin to its final destination. It is a company that handles the shipping process through a large network of third parties.
What Does Freight Forwarding Mean?
Freight forwarders are specialized companies with a lot of experience in the shipping business. These companies manage many different cargos from its customers and have control over the whole shipping process to make sure the shipments arrive safely and timely. In order to provide such a wide range of services they have to develop a reliable network of carriers, insurers, custom agents and advisers to have the ability to deal with all the expected and unexpected issues that can emerge during the transportation process.
In some cases, these forwarders are also experienced in procurement, which means they can also manage purchases on its client’s behalf. Nevertheless, they can be hired for specific purposes, depending on what the client is actually needing. The forwarding service can be either domestic or international. International shipments are more complex and require certain expertise level to deal with different customs procedures.
Example
Dope Ink Co. is a company that manufactures tattoo ink. The company is based in the U.S. but they have offices in more than 12 countries. Since the company has only one manufacturing facility, they have to ship products constantly to the rest of the locations. In order to do so, they hired Loman & Wagner Forwarders LLC, which is a freight forwarding company located in Miami. Loman manages all the ongoing shipments that come from Dope Ink to distribute the products properly among the company’s branches.
Loman pick up the shipment at Dope Ink’s warehouses in Atlanta and handle the transportation to Miami and then they ship, according to Dope’s instructions, each different shipment to the rest of the countries where the company does business. This takes off a lot of work from Dope Ink’s shoulders and even though it is a little bit expensive it is compensated by the lack of troubles they experience by transferring Loman & Wagner all the transportation process’ responsibility.
