The International Transport of Goods takes place for many reasons, but most often to increase the value of the goods. With the rapid growth of e-commerce, many smaller companies need international transportation.
For a large number of shipping companies that market their products, finding the right freight forwarder is an essential part of the infrastructure.
The term freight forwarder is a company that arranges the import and export of goods. A freight forwarder is a natural or legal person who will help you organize all your incoming and outgoing shipments, which can help increase your overall productivity and efficiency.
In this blog, we aim to outline the shipment process and the various steps you should know before ordering your first shipment.
In the age of globalization, international transport is a necessary and indispensable part of the business of every commodity trading company.
It is essential because it facilitates trade between people, which is the basis for civilization development. Shipping lines, agents for booking shipments, freight forwarders, customs brokers are just some of the professions involved in international transport.
If it is necessary to carry a cargo that fits in a transport container but the shipment does not have enough capacity to fill that container and the transport of that cargo is not so urgent, a bulk container transport (LCL) is required.
Thus, bulk freight is an ideal solution for clients who want to transport a smaller amount of goods from distant destinations while reducing the cost of transport and, ultimately, the cost of goods.
In this case, it enters into cooperation with four essential "players" in LCL transport - the shipper, the consignee, the freight forwarder and the shipping line.
The transport infrastructure consists of many installations, including roads, railways, air and water lines, seaports. The transport line is a company that transports goods. However, they are not usually contacted directly.
This role will play by freight forwarders who are logistics providers and who, based on received orders, organize the transportations of goods from the shipper to the consignee and take care of its shipment. The sender is the party carrying the order and the recipient is the party receiving the shipment.
There are five physical and two documentation steps that must take place in the shipping process for every single shipment moving from sender to recipient.
Each step has a specific cost associated, which is usually borne by the sender or recipient. If the plan is to avoid other costs or unnecessary delays in transportation, it is best to agree who is responsible for which part before the shipment is complete.
These seven steps relate to transport to the shipment warehouse, export clearance, pre-shipment processing, shipment to destination, import customs clearance, shipment processing to the target and delivery to the consignee.
The parties responsible for the shipment before delivery should agree on the following:
Transport to dispatch warehouse
Shipment warehouses are decommissioning points in logistics systems. They collect consignments and ship them to final recipients, customers.
The first part of the shipment is transportation to the customs warehouse. It refers to the cargo movement from the shipper to the freight forwarder.
The consignment is carried partly by road, rail or a mix of these and usually lasts from several hours to several weeks, depending on distance and geographical location.
If the shipper is responsible for this part of the transport, it usually arranges a local transport company. However, if we speak about the recipient’s responsibility, it is often best to use a freight forwarder that offers transportation all the way to the warehouse. The transport service doesn't cover the shipping, the only one responsible for it is a shipper.
The freight forwarder should receive and hand over the goods and warn the client about any packaging defect, report the possible risk of damage to or loss of the transported goods.
All shipments accepted by the freight forwarder has to be ready for delivery and the ordering party should prepare them for it.
Shipment requires the freight forwarder to ship the goods to the end-user, customer. There are two basic types of shipping/delivery: by sea and continental vehicles.
When delivering goods by ship, it's essential to keep a record of several things: the loading order, bill of lading, control of the vessel and products, delivery mode, loading data, the exact time of loading, as well as the arrival of the goods.
When shipping goods by rail or truck, it is crucial to keep an eye on the ordering of the particular vehicle, the time of placing and loading the products, the loading itself, the bill of lading and the loading order.
The great advantage of shipping warehouses is the ability to supply the remote part of the market faster, thus significantly shortening delivery times.
Export clearance
The term export clearance of goods, also known as the export procedure, means delivering products from the European Community to third countries.
Each state has its own customs area and it varies from state to state. Any product entering or leaving the customs territory of a particular country must follow the customs legislation of that country.
Under customs law, customs clearance consists of several interconnected operations.
These include a declaration, receiving the confirmation, goods inspection, sorting the goods according to the customs tariff, determining the basis of the customs, the amount of customs duty and other import duties.
For each consignment leaving the country, certain customs formalities must complete and fulfill regulatory requirements.
Customs clearance is a transaction that helps to declare documents and to give them to the competent authorities. It can only be carried out by companies that have valid customs licenses, the so-called customs offices.
A freight forwarder most often does export customs clearance with a valid license or an agent appointed by the freight forwarder. It must carry out before the shipment leaves the country and, in some cases, even before the shipment enters the shipment warehouse.
Shipping process
Once the goods are unloaded from the truck and placed at the spot, they get counted and inspected. After the inquiry, the goods have to have all the valid documentation and confirmation of received products.
After these activities, the goods load into the container and consolidate with the rest of the cargo.
The next step is to place the product in the container and finally load it on the transport vehicle. The shipper usually processes the shipment.
Destination transport
Transporting the consignment to your desired destination is the first step and can be made with any form of transport - air, sea, rail, truck.
As each of the above transportation has its advantages and disadvantages, the freight forwarder decides on the most suitable means of transport to be used to the destination, taking into account the delivery time.
The shipping cost has to pay either sender or consignee, depending on the arrangement.
Part of the procedure consists of a series of different activities that have to make freight forwarder or their agents. It begins with the receipt of the cargo, unloading the cargo, checking the consignment and confirmation that the consignee received the shipment.
Import duty
Import customs clearance usually begins before the arrival of the goods in the country of destination.
The declaration and the relevant documents, which filled out during the customs clearance of export, register the shipment to the competent authorities and collect the customs duty. Import clearance shall be carried out by the freight forwarder, the freight forwarding agent or the broker of the customs office designated by the consignee.
Still, the consignment can also be picked up by the consignee.
The importation process begins with the freight forwarder's electronic declarations to the Customs IT system. During the procedure, it is essential to inspect the goods and to settle the invoice. The freight forwarder gets an electronic mail as a notification about these steps.
Importers from the EU Member States, under the provisions of the common customs law and tariff, can decide for themselves where to customs goods. The advantage of customs clearance in the country of departure is that the products are in free circulation regardless of their destination.
Consignment processing at the destination
Processing a shipment at a destination is a process made up of a series of different activities that do freight forwarder's destination office.
It is essential to handle it before it's delivery to the consignee. This step involves transporting the container to the destination warehouse but also preparing the cargo for the consignee.
This procedure consists in receiving documents from the freight forwarding office, checking any materials, filing a carrier's invoice, etc.
Processing always does the freight forwarder or his agent. Payment can be done by the sender or recipient, but must still be paid in full before it 's delivery to the recipient. This step involves transporting and unloading cargo from the port to the destination depot.
Delivery to the consignee
The last share of the carrier is the delivery of the shipment to the consignee or end consumer. If all goes well, the consignee will get his delivery as soon as possible.
This part does freight forwarder or the local transport company designated by the consignee. Transport to the consignee usually involves only delivery to a specific address, but without unloading from the truck, which is the responsibility of the consignee.
Expertise in understanding international customs laws, finding appropriate shipping routes and obtaining certification merely is beyond the capabilities of most shippers.
Shippers as an indispensable part of international trade
This complexity, which exacerbates over time, can lead to risks. For this reason, shippers have become an indispensable part of international trade; through logistics and industry expertise they bring together buyers and sellers, recipients and senders, and give the possibility of goods exchange.
Planned, coordinated, regulated, and controlled activities constitute a set of forwarding marketing and as such, enable the organization of successful and efficient production of transport services.
With the practical and useful production of freight forwarding services, the freight forwarder empowers transport services, which includes the organization of shipment, delivery, and transit of goods, as well as all other types of transport items.
Freight forwarders need to expand the range of their freight forwarding services and work continuously within the logistics systems to coordinate and organize all activities.
It means that they must make sure that each type of goods, regardless of quality and quantity, arrives at the required destination and at the required time and that it meets the increasingly demanding needs of service users.
In the last twenty years, logistics has been developed more than ever before and is necessary for economic activities. In today's environment, increasing competition is maintained only by those who have a defined logistics strategy, clearly defined business policies and are flexible enough to adapt to market trends.
It means only one thing - the freight forwarding strategy has to be able to predict future events as well, which is precisely what Hubbig's logistics digital platform does.