What is a freight forwarder?

Think of a forwarder as a travel agent for cargo. You tell it what you ship, from where to where and by when. It finds a route, a carrier and a price, and keeps the paperwork moving. Exporters who ship a few containers a month rarely need their own logistics team, because a forwarder fills that role.

This is a general explanation, not legal or customs advice.

Why a freight forwarder matters

Moving goods across borders means many small jobs: space on a vessel, a haulier to the port, an export declaration, a bill of lading, insurance and a customs agent at the other end. A forwarder joins them up and carries the knowledge of routes and rules.

Who hires it depends on the Incoterm. Under FCA, FOB and EXW the buyer picks the forwarder. Under CPT, CIF and DAP the seller usually does.

What a freight forwarder does

• Books carriage by sea, air, road or rail, and compares routes and prices.
• Prepares documents, such as the bill of lading or air waybill, and checks the commercial invoice and packing list before they go.
• Handles customs, either directly or through a customs broker, including the right HS code on the declaration.
• Consolidates cargo. A small shipment shares a container with other shippers' goods (LCL, less than container load).
• Arranges insurance and warehousing if you ask.
• Tracks the shipment and tells you when something is delayed.

Forwarder versus carrier

A carrier moves the goods: the shipping line, airline or haulier. A forwarder arranges it and buys space from carriers. You get a single contact, a single quote and, if the forwarder issues its own transport documents, one party to claim against.

Some forwarders also run their own services. Check who is actually named on the transport document.

How to choose a forwarder

1. 1

   Ask for a quote with every line itemised

   Freight, origin charges, destination charges, customs and documentation fees should be separate lines.

2. 2

   Check experience on your lane and goods

   Dangerous goods, temperature control and bulk cargo all need a forwarder that has done them before.

3. 3

   Agree who does what

   Settle who prepares each document, who books the haulier and who handles customs at both ends.

4. 4

   Check insurance and liability

   Forwarder liability is often limited. Buy separate cargo insurance if the limit is below the value of the goods.

5. 5

   Ask how they report delays

   You want to hear about a missed sailing from them first, not from the customer.

An example from product sales

Say a chemicals supplier sells 20 drums of additive FCA its warehouse. The supplier packs and labels the drums, clears them for export, which FCA puts on the seller, and loads them onto the truck the buyer's forwarder sends. It gives the forwarder the invoice, the packing list and the safety data sheet. The forwarder books the container space, moves the drums and sends both sides a tracking link.

Related terms

• Incoterms: they decide who hires the forwarder.
• Bill of lading: the transport document the forwarder prepares or checks.
• Landed cost: forwarder charges are part of it.
• Demurrage: the charge when a container sits too long at the port.
• Lead time: the forwarder's schedule drives it.

How PromptLab handles it

Record the agreed Incoterm in the trade terms field on the sales order, and keep the forwarder's booking confirmations and the shipping documents in the account's Files tab. Add the forwarder as an account with its people as contacts, and email captured from Gmail, Outlook or your own mail server lands on those records, so the shipment chatter is easy to find next to the buyer's order.

Frequently asked questions

What does a freight forwarder do?

It arranges the transport of goods: books carriers, prepares or checks shipping documents, handles customs paperwork and can arrange insurance and warehousing.

Is a freight forwarder the same as a carrier?

No. A carrier moves the goods. A forwarder arranges the movement and buys space from carriers, although some forwarders also operate their own services.

Do I need a freight forwarder to export?

Not by law in most cases, but most exporters use one. It saves running bookings, documents and customs yourself.

What is the difference between a freight forwarder and a customs broker?

A broker files customs declarations and deals with the customs authority. Many forwarders offer brokerage themselves or work with a broker.

Who chooses the freight forwarder?

It depends on the Incoterm. Under EXW, FCA and FOB the buyer usually does. Under CPT, CIF and DAP the seller does.