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    Chapter Five: Freight Forwarding Overview

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    Ahmed Honest
    Freight forwarders act as intermediaries between shippers and carriers to arrange transportation of cargo internationally. They consolidate small shipments, arrange customs clearance, provide warehousing and delivery services, and ensure insurance coverage if damages occur. Freight forwarders offer various services but are generally responsible for port clearance, customs clearance, cargo handling, and preparing necessary documents. They can also be liable for losses or damages to cargo under their care.

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    Chapter Five: Freight Forwarding Overview

    Uploaded by

    Ahmed Honest
    231 views19 pages
    Freight forwarders act as intermediaries between shippers and carriers to arrange transportation of cargo internationally. They consolidate small shipments, arrange customs clearance, provide warehousing and delivery services, and ensure insurance coverage if damages occur. Freight forwarders offer various services but are generally responsible for port clearance, customs clearance, cargo handling, and preparing necessary documents. They can also be liable for losses or damages to cargo under their care.

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    Freight forwarders act as intermediaries between shippers and carriers to arrange transportation of cargo internationally. They consolidate small shipments, arrange customs clearance, provide warehousing and delivery services, and ensure insurance coverage if damages occur. Freight forwarders offer various services but are generally responsible for port clearance, customs clearance, cargo handling, and preparing necessary documents. They can also be liable for losses or damages to cargo under their care.

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    © All Rights Reserved
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    Download as pptx, pdf, or txt
    231 views19 pages

    Chapter Five: Freight Forwarding Overview

    Uploaded by

    Ahmed Honest
    Freight forwarders act as intermediaries between shippers and carriers to arrange transportation of cargo internationally. They consolidate small shipments, arrange customs clearance, provide warehousing and delivery services, and ensure insurance coverage if damages occur. Freight forwarders offer various services but are generally responsible for port clearance, customs clearance, cargo handling, and preparing necessary documents. They can also be liable for losses or damages to cargo under their care.

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    Chapter five

    Freight forwarding overview


    Introduction
    • When a business decides to export their
    products they soon realize that they have to
    deal with the numerous barriers that have to
    be overcome to ship the product to the end
    customer.
    • Several agencies exist that offer
    transportation services to shippers but don’t
    own any line haul equipment.
    • They primarily handle numerous small
    shipment and consolidate them into vehicle
    load quantities.
    Transportation agencies include;
    Freight forwarder
    Parcel post
    Shipper association
    brokers
    Freight forwarder
    • Definition: - A freight forwarder is an
    organization which provides a logistics service
    as an intermediary between the shipper and the
    carrier, usually on international shipments.
    What a Freight Forwarder Can Offer
    • The services of a freight forwarder can vary
    between different companies but the main
    function of the freight forwarder is to act as
    an intermediary between the client who is
    hiring them and various transportation services
    that are involved in getting the product
    overseas to the customer.
    Con’t
    The freight forwarder will provide the
    client insurance services to make sure that
    if the items do arrive damaged, they will
    be reimburse and not liable for the
    damages.
    • freight forwarder is an agent who handles
    import/export shipments for a fee.
    Some terms
    Port" means the area or place to be designated by the Federal Revenues
    Board as such;
    Customs Clearance means a process of fulfilling customs' formalities for
    import and export cargo on behalf of consignor or consignee within
    customs station;
    Customs Formalities means any customs operations carried out in
    connection with importation, exportation or transit of goods from the time
    of arrival at the customs port until released from the customs control;
    Port Clearance means a process of fulfilling port's formalities for import
    and export cargo on behalf of consignor or consignee within port area
    until the import cargo is brought out from the port or the export cargo is
    loaded onto the ship;
    Con’t

    Groupage/Consolidation:- means the grouping together of several


    compatible consignments into a full container load.
    Protective Agency:- means the representation of a Ship owner to protect
    a ship owner's interest and to supervise the work carried out by the
    ship's agent when the ,owner's ship is in port.
    Ship means:- any kind of floating object used for maritime
    transport and includes vessel.
    The Functions of the Freight Forwarder

    Generally the functions of the freight forwarder


    include the following:
     Port clearance
    Customs clearance
    Groupage/consolidation
     Warehousing and delivery services
     Cargo handling equipment services
     transport the cargo using other transporters,
    Con’t
     packing services;
     preparation and issuance of relevant documents;
     choice of the most suitable carrier and conclusion
    of the contract of carriage;
     follow up movement of cargo;
     consultancy services in freight forwarding.
    • Liability of the Freight Forwarder.
     The Freight Forwarder shall carry out his
    duties with due diligence.
     He shall be liable for defaults in the
    performance of his duties, in particular he shall
    be liable for loss of or shortage of or damage
    to the goods or delay in delivery of the goods.
    Parcel post
    • Parcel post is a small shipments delivery
    services by post office.
    • Rates are based on distance that delivery is
    made from the point of origin.
    Shipper association
    • Shipper associations are operationally similar to
    freight forwarder in that they consolidate
    individual small loads in to bulk shipments to
    gain cost economies.
    • However, they are voluntary cooperative
    organization operating a non profit basis.
    • Where members operating, in specific industry,
    join to manage small shipment purchase.
    • Typically, members purchase product from
    common source of supply are located in one
    area.
    • The association is implemented when group of
    shippers establish an administrative office at a
    point of frequent merchandize purchase.
    • The office arranges for individual purchase
    orders to be delivered to local facility.
    Broker
    • Brokers are intermediary that coordinate
    transportation arrangements for shipper,
    consignees, and carriers.
    Special service charges
    • In addition to line-haul charges, carriers
    frequently provide special services for which
    extra charges are made.
    Special service generally classified as;
    1. Special line-haul services
    2. Terminal services
    Special line-haul services
    • A. diversion and reconsignment
    • Diversion: of a shipment refers to changing
    the destination of a shipment while enroute.
    • Reconsignment: refers to changing the
    consignee of a shipment, usually after it has
    reached the original destination.
    • B. transit privileges: some transport carrier
    established a special services that permits shipments
    to be stopped while in transit for processing or storage
    before moving on to the final destination.
    • C. protection: products b/c of their particular physical
    characteristics require some types of protection in
    transit in addition to that normally provided.
    • For instance, perishable commodities may need
    refrigeration or fragile commodities may require extra
    packing.
    2. Terminal service
    • A. Pick up and delivery
    • B. Switching: the movement of railroad cars
    from private siding and junction to rail
    terminals or station, or vice versa, is referred to
    as switching.
    • C. Demurrage and detention: referring to
    penalty charges imposed on the shipper or
    consignee for retaining a carriers equipment
    beyond an allowed free time.

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