Terminology,roles and services .

1. Freight Forwarder
By
Pawan Joshi

2. A freight forwarder, forwarder, or forwarding agent,
also known as a non-vessel operating common carrier
(NVOCC), is a person or company that organizes
shipments for individuals or corporations to get goods
from the manufacturer or producer to a market,
customer or final point of distribution.

4. A freight forwarder is an agent who acts on
behalf of importers, exporters or other
companies to organize the safe, efficient
and cost-effective transportation of goods.
You will use computer systems to arrange
the best means of transport, taking into
account the type of goods and the
customers delivery requirements.

5. How does freight forwarding business
work?
The freight forwarder acts as an intermediary
between a shipper and various transportation
services such as ocean shipping on cargo ships,
trucking, expedited shipping by air freight, and
moving goods by rail.

6. Roles
•Assist with freight quotes
and other costs of
international forwarding.
•Give a precise and itemized
list of forwarding costs.
•Booking for freight space on
airlines, trains, vessels and
other modes of
transportation.
•Consolidate shipments from
various suppliers.

7. continued…..
•Prepare necessary documents and certifications
for shipment.
• Handle legalization procedures whenever
necessary.
•Distribute important documents to concerned
parties in the transaction such as banks, buyers,
suppliers, etc.
•Prepare for insurance coverage when necessary.

8. continued…..
• Provide facilities or warehouses in foreign
destinations.
•Provide adequate information on hazardous
materials for shipment when necessary.
• Give other specialized services when needed.

9. Functions
•Freight forwarders coordinate
the complexity of financial,
transport, and other service
activities.
•They can be thought of as
travel agents for cargo shipped
to overseas locations.
•Freight forwarding agents
negotiate inland and ocean
rates besides offering valuable
ideas on optimal and the most
cost-effective shipping
alternatives.

10. Services
•A freight forwarder makes
recommendations regarding
receiving payments for
exports.
•These forwarding agents
provide custody and control
of material in transit.
•They assist or prepare
commercial invoice, packing
list, draft, transmittal letters,
consular invoices, export
license, drawback forms, and
shipper's export declaration.

11. Roles in International Export Business
1. Give recommendations to the exporter
2. Perform freight shipping operation
3. Documentation in International Freight
Shipping
4. Keep the Shipper Notified
5. Send documents for collection

12. Top Freight Forwarder

13. Industry Terms
• FMC – Federal Maritime
Commission (FMC) is in charge
of governing vessel operators
and non-vessel operators such
as NVOCC’s and Freight
Forwarders.
• Freight Forwarder – freight
forwarder, forwarder, or
forwarding agent is a person or
company that organizes
shipments for individuals
or corporations to get goods
from the manufacturer or
producer to a market, customer
or final point of distribution.

14. • OTI – Ocean Transportation Intermediary (OTI) is
licensed by the FMC to be an ocean freight
forwarder, a non-vessel operating common
carrier (NVOCC), or an ocean freight forwarder
and NVOCC.
• NVOCC – Non Vessel Operating Common Carrier
(NVOCC) is a consolidator or freight forwarder
who does not own any vessel, but functions as a
‘carrier’ by issuing its own bills of lading or air
waybills and assuming responsibility for the
shipments. Similar to a Freight Forwarder but
typically they have better ocean freight rates and
can issue bills of lading.

15. • IATA / CNS – International Air Transport Association
(IATA) / Cargo Network Services (CNS), IATA is the
airline industry’s trade association that also sets
guidelines for air cargo. CNS is the US arm of IATA
that regulates US IAC’s.
• Independent Freight Forwarder – an independent
freight forwarder is one that is not part of the
Global 25 Freight Forwarders. They do not have an
office in every major country and use different
agents around the world for various services
depending on what their customer’s requirements
are.

16. • The Federal Maritime Commission (FMC) was
set up in 1961 for regulatory purposes
• Ocean Transport Intermediary (OTI) could be
an NVOCC or Freight Forwarder
• Licensing with the FMC is mandatory for
NVOCCs domiciled in the USA

17. Continued…..
The tariff or rates that must be filed by a VOCC or
NVOCC with the FMC for trades to/from the USA
should include:
• Ocean Freight Rates (for both import into USA and
export from the USA)
• Any associated surcharges
• Cargo & Commodity classifications/description
• Port pairs (Port of Load & Port of Discharge)
• Sample of the Bill of Lading that will be used for
the shipment

18. TERMINOLOGY IN FREIGHT
FORWARDING
Adjustments - Costs incurred after a shipment has delivered. These costs can
be added for a discrepancy between the freight characteristics quoted and the
delivered shipment details of weight, class and dimensions, or may be accrued
for additional services performed such as a liftgate.
Agent - A person who transacts business on behalf of another person or
company with full or limited decision-making authority. In shipping, an agent
may supervise customs procedures, documentation, or insurance. This person
may also receive a portion of any monetary gain from a transaction as payment.
Axle Load - The axle load refers to the weight each axle puts on the nation's
highways.
Back Haul - The return trip of a truck transporting cargo or freight. It may be a
return to the origin of the freight hauled in which the carrier is willing to offer a
discount to secure freight for the trip.

19. Beneficial Owner - This is a legal term where specific property rights
belong to a person even though the legal title of the property belongs
to another person. This term is often used in rail or ocean freight and
refers to the actual owner of the freight being shipped, despite the
title of the freight being in another party’s name.
Bill of Lading (BOL) - The bill of lading (BOL) is the legally-binding
contract between the shipper and the carrier, broker or agent that
defines all aspects of the freight shipping arrangement including what
is being shipped and to whom.
Blocking and bracing - This term refers to wood or other supports
used to keep shipments in place on trailers or in containers
throughout the shipping process. This technique is widely used by
expert shippers to secure their freight shipment.
Blind Shipment - When the shipper and receiver are not aware of one
another, the freight shipment is called a blind shipment. In such cases,
the bill of lading lists the party that paid for the shipment as the
shipper or receiver of the freight shipment.

20. Bogie - This is a rail shipping term that refers to a frame with wheels
on which a container is mounted for over-the-road transport.
Brokerage License - A brokerage license is a legally required document
that a broker obtains in order to have the ability to make land, sea and
air freight shipping arrangements. Brokerage licenses are different for
both transportation and customs. To make sea shipping arrangements,
an NVOCC (Non-Vessel Operating Common Carrier) license is required.
To make air shipping arrangements, an IAC (Indirect Air Carrier) license
is required and obtained through the International Air Transport
Association.
Bulk Freight - Freight that is not contained within packages or
containers is referred to as bulk freight. Often times, bulk freight
comes in the form of liquid or a granular form such as sand or crude
oil.
Cartage - A trucking term that refers to shipping freight within the
same city or area.
Chassis - A rail shipping term that refers to a frame with wheels and
locking devices to secure a container during shipping.

21. Classification - A freight classification is assigned to a shipment for the purpose of
applying transportation charges. Freight classifications are used for less than
truckload (LTL) shipments.
Concealed Damage - Concealed damage is damage not visible to the item(s) until
the package is opened.
Consignee - The individual who is financially responsible for the receipt of a freight
shipment. This person is usually the receiver of the shipment as well.
Consignor - An individual (usually the seller) who sends goods to the consignee and
is the legal owner until the consignee pays them in full.
Consolidation - A consolidated shipment is when two or more shipments are
combined to save money on freight shipping costs. This shipping method is used in
less than truckload shipping with multiple stops before reaching the final
destination.
Container - A container looks like a truck trailer with no wheels and is now among
the most common freight shipping methods in the United States and abroad.
Containers are used for intermodal shipping and come in standard sizes to ensure
they fit on standard trucks, rail cars and container ships.

22. Cross-Town - A shipping term used when a container or trailer is
delivered from one railroad as part of the shipping route, the move
is called cross-town shipping.
Cubic Capacity - The total freight load capacity of any truck, train or
ship is measured in cubic feet. The cubic capacity is the total load in
cubic feet which cannot be legally exceeded. Violations of cubic
capacity occur when the shipment’s size violates a carrier’s cubic
capacity rules.
Customs Broker - A person or company who is licensed by the U.S.
Treasury Department to act on behalf of freight importers and
exporters with respect to U.S. Customs transactions. A customs
broker must be used for all shipments going to and from Canada.
Embargo - An embargo is any event that prevents the freight from
being accepted or handled. Most often, an embargo is due to
international conflict or sanctions imposed on a particular country
or group of people. However, embargo events may also include
floods, tornadoes or congested highways.

23. Exceptions - When a problem such as shortage or damage is noted at
the time of delivery, an exception is noted on the bill of lading before
it is signed to designate there was a problem with the shipment.
Gross Vehicle Weight Rating - The rating refers to the vehicle’s
maximum operating weight as specified by the manufacturer. The
weight includes the driver, fuel, engine, body, chassis, and cargo but
excludes the weight of a trailer.
Inbound Freight - An integral part of supply chain management,
inbound freight are shipments coming from vendors.
Interline - This shipping term is used when the initial carrier of a
freight shipment transfers the freight to another carrier to get it to its
final destination.
Intermodal Transportation - When freight is shipped using two or
more modes of transportation. Intermodal transportation typically
refers to truck-rail-truck shipments but may also include truck to air
shipping or truck to ship in the event freight is being shipped
overseas.

24. Motor Carrier - The term “motor carrier” defines a person providing
motor vehicle transportation for compensation.
Motor Property Broker - A freight broker is a person who makes freight
shipping arrangements on behalf of a person or company. The broker
determines the needs of the client, has experience in the industry and
negotiates shipping rates with a carrier who can meet the client’s
requirements.
Nested - A term used in less than truckload (LTL freight) shipping in
which materials are stacked so that one item goes inside another.
Nested freight reduces the amount of space taken up by the combined
freight and makes LTL shipping more efficient as a result.
Not Otherwise Indicated (NOI) - A general class rate or NOI is assigned
to any freight that has no rate listed in the NMFC. The NMFC numbers
dictate the freight rating that is assigned to freight. A freight rating is
based on density, freight stowability, ease of handling, and liability.

25. Tariff - A tariff establishes the cost and contract of a
freight shipment for the shipper and the carrier.
Through Rate - A through rate applies to the distance
between the point of origin and the delivery
destination.
Time-Critical - A time-critical freight shipment delivery
is set to the earliest possible delivery time to
accommodate particular shipping requirements.
Time-Definite - Time-definite deliveries guarantee that
the delivery will occur on a specific day or time of day.
Transit Time - The total amount of time from freight
being picked up to freight being delivered.

26. Truckload (TL) - Truckload shipping can be defined as the
transportation of goods that will fill up a 48’ or 53’ trailer by
volume or weight. Full truckload shipping typically is
contracted to one customer gaining full and exclusive use of
the carrier’s trailer. A truckload is ideal for anyone shipping
multiple full pallets of freight and LTL shipping isn’t cost
efficient. There are multiple pieces of truckload equipment
such as refrigerated trucks and dry van trucks.
Volume Rate - A less than truckload (LTL) shipping term for
rates that are made subject to a minimum weight of 7,000
pounds or more, or cubic volume exceeding 750 cubic feet.
Warehousing - Warehousing refers to the storage of goods
in a facility for a specified period of time. Freight shippers
usually store their goods at warehouses until they’re ready
to ship.

27. THANK YOU….