What is a freight forwarder?

What the law says a freight forwarder is

In the US, the word has a legal meaning. Federal law (49 U.S.C. 13102) says a freight forwarder offers to move goods for pay. In its normal business, it does three things:

• Consolidates. It assembles and combines shipments, and splits them up again for delivery.
• Takes responsibility. It is answerable for the goods from the place it receives them to the destination.
• Uses carriers. For at least part of the trip, it hires a carrier to do the moving.

A broker, in the same law, is someone who sells, negotiates or arranges transport by a motor carrier for pay, without being the carrier. The broker connects you to a trucking company; the forwarder stands between you and the trucking company and answers for the whole move.

Freight forwarder vs freight broker

The liability row matters most in practice. If a forwarder loses or damages your goods, you can claim against the forwarder as if it were the carrier. You deal with one company. With a broker, your contract and the carrier it picked decide where the claim goes. Ask either one, in writing, who pays for cargo damage and up to what amount.

International freight: ocean forwarders, NVOCCs and customs brokers

Once goods cross a border, more specialists appear. For US ocean freight, the Federal Maritime Commission licenses two kinds of intermediary. An ocean freight forwarder books and manages the move and posts a $50,000 bond. An NVOCC (non-vessel-operating common carrier) acts as your carrier but owns no ships. It often fills containers with cargo from many shippers. A US-based NVOCC posts $75,000.

A customs broker is different again: it is licensed by U.S. Customs and Border Protection to clear goods and file the entry. Many forwarders have licensed customs brokers on staff or work with one, so you may get both from the same company. Air forwarding follows its own rules; the definition above leaves out air.

Is UPS or DHL a freight forwarder?

Both run forwarding businesses alongside their parcel networks. UPS sells freight forwarding through UPS Supply Chain Solutions, and DHL through DHL Global Forwarding. Their parcel services are a different product. A parcel is billed per box on its dimensional weight. Forwarded freight is quoted per shipment, on chargeable weight or volume.

How forwarders bill, and how to check a quote

Forwarders price on the freight they buy plus their own fees. The freight part follows the “weight or size, whichever is more” rule used across air and ocean freight. DHL Global Forwarding’s published ratios are a good guide. Air freight counts each cubic meter as at least 166.7 kg. Shared-container ocean freight (LCL) bills per cubic meter or per tonne, whichever is more.

• Work out the chargeable weight by air, sea, rail and road before you ask for quotes.
• Total your cartons in cubic meters with the CBM calculator, and see how much of a container you need.
• Ask for an itemized quote, so the freight cost is shown apart from documentation, customs, handling and insurance fees.

When you need a freight forwarder

• You are importing or exporting and want one company answerable for the whole trip.
• Your shipment is too small to fill a container and needs to be consolidated with other cargo.
• The move has several legs, such as truck to port, ocean, then truck again.

For a few pallets inside the US, you usually don’t need one. Work out your freight class, read how LTL freight is priced, and quote carriers or a broker directly with the freight quote builder.