What Is Freight Forwarding and How Does It Benefit Your Business?

Freight Forwarding

When you’re first starting up a retail or manufacturing business, the product is usually your main concern. You’re consumed with making sure you have the best products possible and finding ways to market them to your clients.

As you start taking more concrete steps, however, shipping becomes a more important part of the business than many entrepreneurs expect. Customers want the correct items, they want them on time, and they want them to be intact.

If any of these doesn’t happen, it’s a recipe for a costly return and an even costlier negative review online.

If you’re struggling to handle your shipping in-house or you anticipate more growth than you can keep up with, freight forwarding is an option. Here’s what you need to know:

What is Freight Forwarding?

If you’re looking to outsource your shipping process, there are a variety of options. Freight forwarding is the middle-of-the-road choice. Essentially, freight forwarding is a middle ground between a freight broker and a third party logistics company (or 3PL).

While a third party logistics company will take over your entire warehousing, fulfillment, and shipping process from start to finish, they’ll charge you a pretty penny. Freight forwarding is a less expensive alternative. While the services are not as extensive, the price is also much more accessible.

Freight brokers, on the other hand, are primarily focused on hooking you up with shipping services. They won’t take as much of the work off your plate as a freight forwarding service will.

Benefits of Freight Forwarding

If you’re trying to decide if freight forwarding is the best move for your company, here are the benefits you need to consider:

Existing Tracking Systems

One of the largest yet most important tasks for your shipping process is implementing a tracking system. Consumers today expect to know where their items are at all times. Even more importantly, you need to know that items actually get to their destinations as promised.

An easy to use tracking system takes funding, planning, and insider knowledge. A freight forwarding service, on the other hand, already has a system in place.

Warehousing Options

Freight forwarding companies typically have a variety of services you can choose from. Most offer warehousing with your freight forwarding service as an option.

Managing your own warehouse is costly, between real estate, employees, equipment, and more. Maintaining your own warehouse also makes it difficult to expand without a huge expense.

If you choose to warehouse with your freight forwarder, though, you’ll streamline the process. It also opens the door to future expansions without the need for a massive investment.

Ease for Large Shipments

Let’s say you’re a small company that designs and manufactures chairs. You’re used to getting small orders of 6 or fewer for private residences. Today, though, you receive a huge order: a conference center wants to swap out all 2,000 of their chairs with yours.

It’s an incredible business opportunity, but do you have the shipping power to make it happen?

Adjusting your own shipping process to accommodate the order can create problems for other customers, assuming it’s possible at all. A freight forwarding service, on the other hand, already has the resources to handle high volumes with ease.

Lower Transportation Costs

Some businesses make the mistake of assuming freight forwarding will add to the expenses outright. They fail to take into account that the per-item transportation cost is usually lower.

Because freight forwarders work with transportation companies in such high volumes, they get much lower rates than you can get independently.

Easier International Shipping

If you’ve investigated shipping your products internationally, you know it’s no easy feat. Between finding the right shipping companies and getting the export documentation in place, it takes some know-how.

Freight forwarders, on the other hand, already have the experience and resources to make it happen. They know what documents they need and they can prepare them with ease while giving you a better rate on transportation costs.

When to Consider Freight Forwarding

Ultimately, every business needs to weigh their own needs and find the shipping options that work for them. In many cases, freight forwarding is a great way to enjoy more flexibility with fewer headaches.

Freight forwarding might be a good option if:

Your Business is Expanding

It’s great to see your company grow, but it can be more expensive than you expected. Freight forwarding can make growth more affordable and easier to manage.

You Have a Shipment You Can’t Handle

You don’t need to send all your shipping to a freight forwarder to use their services, You can also seek their help on an on-demand basis. If you have an order that’s too large for your current shipping process to handle, a freight forwarder can help. The same is true if you have an order to an area or region your shipping process can’t easily reach.

Urgency Isn’t an Issue

The only downside to freight forwarding is that you don’t have as much control over how and when your shipment arrives. If you have an order that requires a quick turnaround or if a customer chooses expedited shipping, a time-sensitive delivery service will best for that circumstance.

Third Party Logistics or Freight Brokers Don’t Fit Your Needs

Freight forwarding is just one option for how to outsource parts of your shipping process. Many companies don’t know the array of options that are available.

If you’ve tried or researched 3PL companies or freight brokers and they haven’t met your needs, give freight forwarding a try.

Letting Freight Forwarding Open Doors for You

Freight forwarding helps businesses in several ways. Whether you’re trying to find a better alternative for your in-house shipping or expand your business with fewer growing pains, it may be time to call a freight forwarding service.

For more information about the best ways to deliver your products safely, quickly, and easily, check out our delivery tips blog.