If you ship product from China to the United States you will be familiar with the complications surrounding shipping. As a small business, you might think hiring a shipping agent is unnecessary, too expensive or in the ‘not just yet’ pile.
However, there are some instances in which freight forwarders will be cheaper than regular carriers, like UPS and FedEx. This post details some of those.
1. Bulk Discounts
It is no secret that freight forwarders offer cheaper space on ocean vessels because they buy space in bulk at a discount and portion it out to their customers. You should think seriously about using a freight forwarder if you are shipping anything on the water regularly.
2. Direct Negotiations with Airlines
Freight forwarders also negotiate directly with commercial airlines such as Delta, KLM and Air China to fill the space they have on commercial flights. They can also secure space on dedicated charter flights for large shipments and oversized equipment.
The rates for air shipment are sold at the exporting airport, meaning the price is determined there. Shipping agents develop relationships with airlines who, in turn, give them lower prices.
3. Couriers are getting too expensive
Couriers such as UPS and FedEx have the largest shipping volumes and often have their own planes flying the routes from China to the US. You may be wondering why, in that case, their prices are so exorbitant. They are incentivized to keep pricing high because they handle many individual packages. It makes more sense for them to charge 100 customers shipping 1kg packages $30 ($3000) than it does to charge once customer with a 100kg shipment $5 per kg ($500).
4. You ship more than this amount
Shipping rates change and the switchover point is not black and white. However, if you are shipping product with a total weight of more than 30kg (around 60lb), you should begin asking a freight forwarder for quotes. If you are shipping product weighing 100g kg or more, a good air freight forwarder will beat the couriers 9 times out of 10.
This is a guest post by our shipping guru Joseph Walsh, a licensed Customs Broker and Freight Forwarder who has been offering his clients diverse transportation solutions for over a decade. He specializes in dealing with multiple government agencies such as the FDA, Fish and Wildlife, and US Customs. Services include air freight, ocean freight, import, export, customs clearance, HS Code consulting, domestic trucking, warehousing, and distribution. Joseph can be reached at firstname.lastname@example.org or 516-209-4517.