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How Do You Know Freight Forwarding Is More Than Rate Shopping And Space Booking?

Freight Forwarding Is More Than Rate Shopping And Space Booking

A freight forwarder’s job entails more than just shopping for cheap rates and space. A forwarder faces many challenges as part of providing an efficient service to the customer. How a freight forwarder handles these challenges sets them apart from the rest of the pack.

Whether the going is good or bad in the shipping and freight industry, one thing is for sure, and that is, there is never a dull moment in the life of a freight forwarder. Especially, when there are challenges of various kinds to be faced on a regular basis.

The right service provider is the eyes and ears of the customer in the shipping and freight market and any forwarder worth his salt must be capable of overcoming these challenges without any notable disruption to their customer’s business.

Below are some such challenges with some real life examples that a freight forwarder could face during the everyday operations.

Delays due to short weeks and holidays

While as ordinary people everyone welcomes short weeks and holidays, for a freight forwarder these short weeks and holidays could become a major scheduling, cost, and delivery nightmare if not planned properly.

Festivals such as Easter, Whitsun in Europe, Thanksgiving and Christmas in the USA, Qing Ming Festival, Dragon Boat Festival and Chinese New Year in China can and have caused capacity bottlenecks across the world. Not just in terms of shipping schedules but also in the processing of customs clearance processes.

For example, recently over the Easter holiday, customers faced long waiting periods of over seven days for customs in Hamburg to process customs documentation (in German). This backlog was reportedly the result of the arrival of four mega container ships over the Easter holiday period in Hamburg. The backlog was as much as 11,000 applications at the time.

Such delays also have another knock on effects such as lack of availability of trucks for both inbound and outbound movements with waiting time of around two weeks in the extreme to secure a truck.

Challenges due to port congestion

Port congestion may manifest itself due to several factors such as port productivity delays, port strikes, seasonal rush, temporary circumstances, and bad weather.

In the months of April/May 2017 many businesses were affected due to severe congestion in Shanghai. This congestion was because of the dense fog, higher-than-normal container volumes and an aftermath of a shake-up in shipping alliances.

Some of the businesses were caught up in the more than 100 container vessels that waited out for up to an average of 53 hours.

These kinds of delays can have adversely affect on time sensitive JIT (Just In Time) businesses such as automotive and retail industry.

China port congestion

Disruptions due to market changes

April 2017 saw the launch of 3 major shipping alliances 2M Alliance, THE Alliance and Ocean Alliance.

While many expected these mergers to be of some benefit to shippers and shipping lines in an already struggling industry, the first feedback we have had points to a badly planned transition.

This lack of planning combined with lack transparency in terms of which transshipment hubs will be used has seemingly led to short-term changes in the shipping timetable increasing the possibility of cargo rollover.  

Port strikes

Port strikes are another major impediment that affects all customers alike.

As a result of the latest dock workers strike on 5th of June, some of Spain’s biggest port terminals came to a standstill as shipping lines such as Maersk redirected cargoes to other ports in Portugal, Morocco, and Malta to avoid the strike.  

Conclusion

The scope of work of a freight forwarder is not merely limited to negotiating freight rates, contracts and booking cargo on the customer’s behalf, but it is much more involved and intense.

All above challenges caused by external forces can create a sudden and severe change in shipping schedules which greatly inconveniences customers and their operations. It also challenges forwarders to find substitute solutions to assist clients.

Through experience, market knowledge, and technology, freight forwarders can weather challenges like above. The aim is to make global logistics as easy and convenient as possible for customers.

Read more: This is What You Should Know About Different Modes of Transportation in 2017

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