The best freight forwarders have these 3 qualities

Shipping a product from a factory to a fulfillment or distribution center is often one of the last to-do’s business owners have when sourcing their products. Entrepreneurs are often so focused on making sure everything is in place to sell the product, that the supply chain setup can be overlooked.

Overseas transportation from factory to fulfillment center can be costly — especially when shipping with parcel delivery companies. In reality, these parcel services are only price-competitive up to about 150 kgs (in chargeable weight). For anything bigger, it’s more cost-effective to work with a freight forwarder.

Many business owners will understandably gravitate towards the forwarder who offers the lowest initial price. However, these Amazon sellers and entrepreneurs find out the hard way with hidden charges and uncertainty around the location of their goods. This ends up costing more time, energy, and money than if they had chosen a service-based freight forwarder who offers honest, up-front pricing and real-time shipment visibility.

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In addition to price, entrepreneurs should consider the following three attributes when selecting a freight forwarder:

Communication

E-commerce is a chaotic business environment, prone to last-minute changes ranging from adjusting carton dimensions to the forecasted velocity at which in-stock products sell.

A forwarder who communicates clearly and effectively will save businesses money. A prime example is to make sure the same company partners with you across multiple time zones. When selecting a freight forwarder, ask them about their physical presence and/or capabilities in both the country of origin and destination.

Communication doesn’t have a tangible price tag, but it delivers an incredible value (and peace of mind) while you focus on growing your business.

Prior to confirming an upcoming shipment, pay attention to how your forwarder communicates with you. This will tell you a lot about their level of customer service and might reveal communication challenges.

Choosing a Freight Forwarder for Amazon FBA

Transparency

The first time you receive a quote from your freight forwarder can be confusing. And this is where “transparency” becomes an invaluable aspect of the process. To have control of your shipment, your forwarder needs to be able to clearly explain what you’re being charged for, and to what extent you can include or exclude features you don’t judge necessary.

Before booking your next shipment, make sure you understand customs duties and Incoterms. This way, you’ll have a clearer understanding of what’s included in your shipment and how to avoid unexpected charges along the way.

At origin, factories often partner with freight forwarders who work through an agent model. These shipping agents do not have a global presence and there is often a lack of visibility. It can, however, add value to know exactly what’s going on with your shipments and plan around the arrival of your cargo across different time zones.

With so many advances in technology, one might wonder why many freight forwarders still manage shipments through outdated methods. When shipping goods around the globe, exceptions are bound to occur. Nonetheless, you should be informed as they happen — giving you the valuable opportunity to react.

Ask your forwarder how they handle pricing, billing, and shipment tracking to be sure they’re providing the level of transparency you need.

Familiarity With Your Type of Business

Online shopping is clearly the future of retail. Surprisingly, many logistics companies haven’t embraced this change. Partnering with a freight forwarder that is familiar with e-commerce is essential as you aim to quickly grow your business.

Let’s take for example Fulfillment by Amazon (FBA)’s strict guidelines around deliveries and packaging. As a seller, your hands are tied following their strict rules and regulations. Freight forwarders who understand this side of the business will easily navigate you through Amazon’s unique fulfillment requirements.

The best piece of advice we can give you: ask your freight forwarder how they approach optimizing your door-to-door Amazon FBA costs opposed to just port-to-port. Tremendous cost savings can be achieved using the right partner for the last-mile delivery, which can’t be quoted up front.

Shipping to Amazon FBA from China

Final Thoughts on Choosing a Freight Forwarder

Don’t just go with the cheapest option offered. With so many hidden costs and your responsibilities as an importer, forwarders who offer a premium service, in combination with a competitive rate, could end up saving you hundreds (or even thousands) of dollars on the backend.

Make sure the provider you choose offers transparent quoting, a clear and collaborative communication tool, and readily available updates on the status of your shipment.

Additionally, don’t underestimate the value of in-house customs brokerage services that can drastically reduce transit times. Furthermore, keep in mind that you can’t freely pick and choose your tariff codes, which are regulated by government entities. If someone tells you that they can get you a better code for cheaper duties, they may be cutting corners and putting your business at a compliance risk.

This piece is the first in a series of articles written by Flexport in collaboration with The Selling Guys. Flexport is a technology-driven freight forwarder whose teams specialize in compliantly shipping goods around the globe for e-commerce and startup-based companies. If you want to learn more about what Flexports specialists partner teams can offer you please click here.

Special Offer – receive a free customs clearance on your first shipment (Value $150)- Click here

One Response

  1. By Peter Douglas Posted on July 15, 2019

    Here is some vital information that EVERYONE should know, but I have never seen it mentioned.

    WHAT YOU HAVE TO KNOW in the shipping plan created in Seller Central, is that if you have ONE shipping plan for products from another country imported into the USA, you CAN’T get the discounted shipping/freight rates from Amazon-Partnered-Carriers.

    This is vital – read that sentence again, please. What it means is that the discounted shipping/freight rates from Amazon-Partnered-Carriers is ONLY for the freight component of shipping WITHIN the USA, and where the pickup point and the destination are BOTH within the USA. Effectively you have to have 2 plans for shipping/freight – one for the shipment from the FOB stage in China (or wherever it is manufactured) to the port in the USA (this plan made by the Freight Forwarder), and the second plan from that USA port to the Amazon warehouse/distribution centres (this plan is made by you in Seller Central). NOWHERE is this spelled out for newbies like us to understand. Amazon-Partnered-Carriers rates are MUCH MUCH MUCH cheaper, which is mentioned in a few places within Amazon Seller Central, but not in the shipping page! So as newbies we didn’t know any different, when there was only one option available.

    In retrospect, our ‘mistake’ can be traced back to the sequence of filling out a shipping plan. Because we didn’t know that the Amazon shipping plan only covered the land-component of (within USA) freight costs, when the first question asked when creating a shipping plan is ‘where is it being shipped from?’, we entered ‘from Shenzen, China’. What would you have put down as the answer? From then on, the questions asked are based on the first answer, as you get different ones depending on how you answer each question. Our shipping plan said something along the lines of ‘Amazon-Partnered-Carriers are not available to this location’. They didn’t say ‘… because the origin point should be LA, California, not Shenzen China’. We didn’t know better, so we left it in the hands of the Freight Forwarder, who then used their choice of carrier, but at a much higher price. We paid over US$4000 for the freight, compared to the cheapest way (Amazon-Partnered-Carriers) of about US$1000.

    The background to this saga is that our product is small-oversize, and has its own shipping carton. We ordered 200 items, so there are 200 boxes. The manufacturer did a good job. Being very new to all this, we then employed an Inspection Agent, and a Shipping Agent. Our Freight Forwarder handled both tasks. So we made up a shipping plan in Seller Central and gave the details to our Freight Forwarder and waited for it all to transpire.

    When we made out the shipping plan, Amazon requested that we ship to 3 warehouses in USA (Redlands CA, Clear Brook VA, and Groveport OH). We passed this info along to our Freight Forwarder and they made up a quote, which was high, but being total amateurs at all this, we thought it was because the product is slightly oversize, and needed special treatment. It was only a month or so later, after the product was live in Amazon (and as our experience navigating Seller Central grew), that we sought clarification of the costs.

    During the whole process, neither our Freight Forwarder nor Amazon offered the comment that there was a cheaper way. Effectively nobody knows about this ‘problem’, that if your shipping-plan-answer to the first question is not within the USA, you are excluded from cheaper discounted freight.! We have discussed freight details with an Amazon rep on the phone about 5 times, and emailed at least 5 times, and only after the last time did we finally get the right answer.

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