| Your company just finished building that expensive | | | | broker, they negotiate with a variety of carriers to |
| piece of equipment and you are now ready to ship it | | | | get good rates and handle the logistics and tracking. |
| to the customer. It took you 10 weeks to build it so | | | | The major difference is that the freight forwarder |
| the last thing you want to do is deal with damaged | | | | takes legal responsibility for the shipment and offers |
| or lost cargo. Choosing the right shipping method is | | | | consolidation of shipments. That means that damage |
| critical if you want to minimize problems, while | | | | or other liability falls on the shoulders of the freight |
| keeping your costs on budget. Spending a little time | | | | forwarder which handles the claim on behalf of the |
| investigating and comparing options can save you | | | | shipper. Both the freight broker and the freight |
| both time and headaches. | | | | forwarder have relationships that will get better |
| When looking for a shipping solution you have the | | | | shipping rates over what the small business could get |
| following options: | | | | from a common carrier. |
| - Global Shipping Company | | | | - Local trucking company covers a city or slightly |
| - Common Carrier | | | | larger area. For shipping heavy loads across town, the |
| - Local Trucking Company | | | | local trucking company may be your best bet as you |
| - Freight Broker | | | | can often get competitive rates, on the other hand |
| - Freight Forwarder | | | | some of these companies are very small and you |
| The above choices each have advantages and | | | | may have to wait longer before your cargo is picked |
| disadvantages: | | | | up. Some considerations when choosing a carrier: |
| - The global shipping company has terminals | | | | - Insurance: Many carriers have a standard insurance |
| nationwide and internationally. They can ship by truck, | | | | claim rate that only allows you to recover $.10 to |
| boat, or plane. Their global network of resources and | | | | $.50 per pound. If this is not acceptable, then use a |
| computer tracking results in timely efficient deliveries | | | | freight forwarder as they insure the loads |
| overseas. The other disadvantage of this type of | | | | themselves and are able to cover the total cost of |
| service is that loads are handled frequently as | | | | the freight. |
| shipments are routed through a network of terminals. | | | | - Expedited Shipments: If a shipment has to get |
| The more frequently a load is transferred, the higher | | | | there quickly, don't automatically assume that you |
| the risk of getting damaged or lost. | | | | have to use air freight. Some trucking companies will |
| - Common Carriers have a network of terminals | | | | use driver teams so the truck is on the road around |
| either nationally or in a region. They are strictly | | | | the clock. The extra driver does cost more but it |
| trucking companies. Large fortune 500 companies get | | | | would still be a substantial savings over air freight. |
| volume discount pricing, but the small business and | | | | Expedited truck shipping usually takes only day longer |
| entrepreneurs will pay a higher rate. Once your | | | | than air shipment, also air freight involves more |
| shipment is over 1000 lbs, cost can be prohibitive. | | | | handling which means your cargo has a greater |
| The common carrier will use a local driver pick up | | | | chance of loss or damage. |
| your cargo and bring it to the nearest terminal where | | | | - LTL: LTL stands for less than load and it means just |
| it will be unloaded from one truck and reloaded to | | | | that, some freight companies won't do LTL. This |
| another to go to the closest major city to the final | | | | could delay your shipment as the carrier is trying to |
| destination. This process is called cross docking. Cross | | | | consolidate enough pick ups to create a full load. |
| docking can be done several times before the cargo | | | | Many times a freight forwarder can do LTL with little |
| reaches its final destination. This additional handling | | | | cost or time penalty. |
| increases the chances of cargo damage or goods | | | | - Back Hauling: Often times a carrier will make a |
| being lost or delayed. The more times a load is | | | | delivery to a destination, but not have a load to take |
| handled, the more chances of an unfortunate | | | | him back home. Back hauling is picking up cargo for |
| occurrence. | | | | returning to the origination point. Many times trucking |
| - Freight brokers don't own trucks; they arrange | | | | companies will back haul at a very low cost, since the |
| shipments with a variety of other trucking firms. | | | | alternative is an empty load. Some freight brokers |
| They handle a large number of shipments so they | | | | and freight forwarders are very good at finding |
| can use this leverage to negotiate lower pricing with | | | | these opportunities and can save you a lot of money. |
| the common carriers. This results in lower rates to | | | | In addition, most times, there is no cross docking |
| the client. While the freight broker will negotiate and | | | | with this method so your chances of lost or |
| track shipments for you, they do not take legal | | | | damaged goods are greatly reduced. For the |
| responsibility for the cargo: that falls back to the | | | | expensive cargo or fragile loads, this method is the |
| carrier. This legal arrangement can sometimes put the | | | | safest way to ship. In general, the small company will |
| customer at double jeopardy for shipping costs, as | | | | get the best value by using a freight broker or |
| they pay the freight broker, but if for some reason, | | | | forwarder, but make sure you choose an |
| there is a problem between the broker and carrier, | | | | experienced company. There are many carriers out |
| the carrier can go back and collect payment directly | | | | there that are not dependable and an inexperienced |
| from the customer. | | | | broker may end up going with an "unreliable" carrier, |
| - A freight forwarder is very similar to the freight | | | | which could result in lost, delayed or damaged cargo. |