This document discusses how to analyze freight forwarding proposals to avoid hidden charges. It advises the reader to ask detailed questions about charges, verify accurate cargo dates and insurance coverage, and check for additional fees that may not be explicitly included. While cheaper forwarders can save money initially, they may charge more in fees long-term and cause compliance issues. The document recommends verifying that proposals will be honored as quoted to avoid unexpected costs.

1. Freight Agency
Be in control of your international freight
shipping costs by knowing how to analyze
your freight forwarding proposal.

2. Apples to Apples?
International transportation can be overwhelming, especially when
calculating international shipping costs from a freight forwarder.
• Do you know the right questions to ask to make sure you receive an all-
inclusive transportation proposal?
• Do you know to break down the charges once you receive the proposal to
make sure there are no hidden line items?
• Do you know if there are any “add-on” fees that could arise on your invoice?

3. Hidden Charges Breakdown
When you are comparing or gathering freight forwarding proposals, it is
imperative to beware of line items that could be hidden charges.
• Carrier GRI/GRR/PSS: Carriers have been implementing general rate
increases (GRIs), general rate restorations (GRRs) and peak season
surcharges (PSS); however, some freight forwarders are not informing the
customer of these charges until after the cargo is booked. If your cargo ready
date falls into surcharge period, be sure the fee is shown up front.
• China VAT: Chinese authorities have begun charging transportation
companies within the country a value added tax (VAT). If freight forwarders
are charged this directly from the carrier, the charge will be added as an extra
line item. Verify with your freight forwarder if you do not see China VAT on
your proposal for freight that touches China or risk being charges an extra 6
percent when you are invoiced.

4. Hidden Charges Breakdown
When you are comparing or gathering freight forwarding proposals, it is
imperative to beware of line items that could be hidden charges.
• Carrier GRI/GRR/PSS: Carriers have been implementing general rate
increases (GRIs), general rate restorations (GRRs) and peak season
surcharges (PSS); however, some freight forwarders are not informing the
customer of these charges until after the cargo is booked. If your cargo ready
date falls into surcharge period, be sure the fee is shown up front.
• China VAT: Chinese authorities have begun charging transportation
companies within the country a value added tax (VAT). If freight forwarders
are charged this directly from the carrier, the charge will be added as an extra
line item. Verify with your freight forwarder if you do not see China VAT on
your proposal for freight that touches China or risk being charges an extra 6
percent when you are invoiced.

5. Hidden Charges Breakdown
• Cargo Ready Date: If the cargo ready date the freight forwarder is quoting
you is not accurate, the transportation proposal could vary by hundreds of
dollars per container. In the current ocean freight rate market, it is
imperative the accurate cargo ready date is quoted upfront to avoid any
changes in rate.
• Cargo Insurance: Be sure that cargo insurance is included as a separate line
item. Most times if cargo insurance is not included on a transportation
proposal, it is not included in the quotation. When reviewing international
shipping proposals, also be sure to verify that the insurance covers freight
from origin door to destination door. Often times, insurance offered by the
forwarder only cover the goods from port to port, making all drayage claims
ineligible. Most damage and pilferage happens from origin door to origin
port or from destination port to destination port and, in our opinion, is when
the cargo is most susceptible to claims.

6. Hidden Charges Breakdown
• Courier/Documentation Fees: When looking at an international shipping
proposal, it is important to see if any courier/documentation fees are
included or offered as a separate line item. Many freight forwarders could
tack on this fee to the invoice, even though it was never included as a line
item in the original transportation proposal.
• Pallet Fee: When shipping loose cargo, it is important to provide your own
pallets or risk being charged a fee to have the cargo packaged on forwarder-
owned pallet. If you will not be providing your own pallets, it is imperative to
know all charges up front.
• Inland Delivery: If you do not specifically ask to be quoted from door-to-
door with zip codes included, the forwarder might be charging you from
port-to-port. If you are looking for an all-inclusive quote, including inland
transportation, be sure to verify that the charge is included on your
transportation proposal.

7. Hidden Charges Breakdown
• Max Cargo Weight: When shipping a full container load (FCL) of a heavy
commodity, it is necessary to verify the max load amount with your carrier of
choice. Overweight cargo is subject to additional fees.
• Container Management Fee: Some carriers in some select routes have
begun implementing a container management fee (CMS) to cover the
operational cost in managing container turn time.
• Free Time at Destination Port: If you are shipping to a country with higher
than average hold times at the port, it is imperative to ask the forwarder how
much free time the shipper has at the port. Extra free time at the port can
save the customer hundreds of dollars per day, per container in some cases.

8. How to get the best proposal
It does not matter if you have a good rate if the proposal does not keep in
mind what is most important to your supply chain.
Ask your freight forwarder to supply carrier options based on your preference.
Is it an issue of price? Ask for the cheapest carrier options. Is it an issue of
transportation time? Ask for the most reliable carrier with the lowest
transport time.
Is there a transshipment with a certain carrier? Keep in mind this could also
hold up your shipment for weeks on end. Each transshipment port increases the
uncertainty that the freight will arrive on time.

9. The “cheap” freight forwarder
Use caution when booking through a freight forwarder whose only benefit is
price. You could be paying a lot more in fees in the long run.
A cheaper freight forwarder might save you money upfront, but could cause you
a headache and hefty fees resulting from improper management.
For instance on imports into the United States, if the forwarder and Customs
House Broker do not fill our proper Customs documentation ahead of time, the
shipper is liable for hefty feed. Noncompliance with the importer security filing
(ISF) will cause CBP to levy fines of $5,000 USD to the importer of record.

10. Will the proposal be honored?
“What your quoted is what you pay” is not always the motto for some freight
forwarders
Although it seems elementary, the shipper should always verify with the freight
forwarder that their proposal will be honored.
What you see might not always be what you pay with some less-than-ethical
forwarders. Ask the company for testimonials from other customers that ship in
the same trade lanes or the same commodity that you do.
If the company is proud of their service, they should be happy to comply.

11. 11
are a set of three-letter standard trade terms most commonly used in
International contracts for the sale of goods.

12. Need help?
If you have any questions, or would like an international shipping proposal,
please contact Dymarox at +27 12 665 2037 or www.dymarox.com
We would be happy to quote your next shipment or even take a look at your
current transportation proposal to see if you could be on the hook for any
hidden charges.
Dymarox Offices
Head Office Pretoria Office: Southdowns Office Park,
22 Karee Street, Irene Ext.48, Pretoria, South Africa
Tel : +27 12 665 2037 Fax : +27 86 679 9419
Cell: + 27 82 464 8139
E-mail: carl@dymarox.com Website: www.dymarox.com