A freight 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.Forwarders contract with a carrier or often multiple carriers to move the goods from one country to another.
A forwarder does not move the goods but acts as an expert in the logistics network. The carriers can use a variety of shipping modes, including ships, airplanes, trucks, and railroads, and often use multiple modes for a single shipment. For example, the freight forwarder may arrange to have cargo moved from a plant to an airport by truck, flown to the destination city and then moved from the airport to a customer's building by another truck.
International freight forwarders typically handle international shipments and have additional expertise in preparing and processing customs documentation and performing activities pertaining to international shipments.
Information typically reviewed by a freight forwarder includes the commercial invoice, shipper's export declaration, bill of lading and other documents required by the carrier or country of export, import, and/or transshipment.
The FIATA shorthand description of the freight forwarder as the "Architect of Transport" illustrates the commercial position of the forwarder relative to its client. In Europe,some forwarders specialize in "niche" areas such as rail-freight, and collection and deliveries around a large port. Modern freight forwarders offer an end-to-end process i.e. shipping the goods from the place of origin to the final destination. Together with Freight Tracking Technology, freight forwarding agents can view real time freight information.
One of the earliest freight forwarders was Thomas Meadows and Company Limited of London, England, established in 1835 . According to "Understanding the Freight Business," written and published by the executive staff of Thomas Meadows and Company in 1972, the advent of reliable rail transport and steamships created demand for the fledgling freight forwarding industry. Trade developed between Europe and North America, creating additional demand. The first international freight forwarders were innkeepers in London who held and re-forwarded the personal effects of their hotel guests.
The original function of the forwarder was to arrange for carriage by contracting with various carriers. Forwarder responsibilities included advice on documentation and customs requirements in the country of destination. His correspondent agent overseas looked after his customers' goods and kept him informed about matters that would affect the movement of goods.
In modern times, the forwarder accepts the same responsibilities. It operates either as a domestic carrier or otherwise with a corresponding agent overseas or with his own branch-office. In a single transaction, the forwarder may be acting as a carrier (principal) or as an agent for his customer or both.
International freight forwarders, Non-Vessel-Operating Common Carriers (NVOCCs), and customs brokers often charge for transferring documents to another transportation company at the destination. This fee is a part of the ocean freight charges, being paid by the importer at the port of discharge in the International Commercial Term (incoterm) FOB (free on board), and by the exporter at the origin in the incoterms CFR (cost and freight), CIF (cost, insurance and freight) and DDP (Transportation cost from factory to delivery port, custom clearance at delivery port, freight, custom clearance at discharge port, transportation from discharge port to importer factory).This fee is separate from documentation fees charged by carriers and NVOCCs as part of the freight charges on a bill of lading and is separate from other fees for document preparation or for the release of cargo.