How to compare forwarder services with freight comparison websites. 3 important things to consider when comparing freight, before placing the first booking
Traditional freight comparison
Freight comparison is traditionally not an easy exercise. The process of small-scale freight procurement normally involves:
Identifying relevant freight forwarders
Sending out request for quote (RFQ)
Following up to get a response
Further enquire to compare rates and solutions
Making a final choice
This process can easily take weeks, and most of us have learned that if we have small infrequent shipments, the responses from the selected freight forwarders are not always overwhelming, and certainly never comparable.
In and ideal world, freight comparison should be simple. At the click of a button, shippers should be able to get an overview of available freight solutions and be able to compare key features of the solutions available. In addition, we should have clarity on market level pricing, and have the information available to allow choice based on real differentiators such as transit time, cost, proximity to warehouses and other customers’ feedback on own experiences and historical services levels provided. In addition, we should avoid the hassle of disputing invoices and surprises of later unexpected costs.
Booking and comparison websites
Traditionally, the decision on which freight forwarder to use has been based on personal relationships, trust and prior experience with the forwarder. With increased commoditisation of freight forwarding products, such as less than container load shipping (LCL), and a general high level of service and accuracy now offered by the majority of established freight forwarders, it is now possible to base the freight forwarder decision more on comparable metrics. These metrics are made available by freight comparison and booking sites, making it easy to get an overview of the market in your particular trade. Here you will find a few recommendations for making your first online freight forwarder booking a good experience.
Know the freight forwarder
Ideally, you want to book directly with the freight forwarder. This will increase your flexibility in case of any later amendments to the shipment, as you can deal with the forwarder’s customer service team directly. So use comparison and bookings sites that merely facilitate a shipper/forwarder contractual relationship. You can recognise these websites as they display logo, company name, and contact details of the forwarders together with the different service options. When you confirm and pay for your booking, the terms and conditions would usually also refer directly to the freight forwarder standard terms. You are thereby certain that you buy from the forwarder, and not from the website.
Instant pricing and immediate invoicing
If you ship general cargo and you want to limit the time you spend on dealing with a forwarder, make sure to use a booking site, which offer immediate payment and confirmation of the booking. Thereby you know that you have paid the complete cost of the shipment and avoid any future surprises, and your freight comparison becomes more meaningful. The alternative is to use an RFQ site, which sends your shipping requirements out in a bid to associated freight forwarders. This, however, can be a tedious process and once again requires manual comparison of freight quotes, which are usually not easily comparable.
Know what you are buying
When you specify your requirements on the freight forwarder comparison site, ensure you get an overview of exactly what is included in the rate. This will make comparison possible and ensure that you don’t get any unexpected invoices later in the process. In general, there are seven steps in the shipping process, which needs to be paid for every shipment, either by the shipper or the consignee. Agree on this up front, and determine how big a part of this you want to buy from the freight forwarder online. See the Knowledge Centre to learn more about The seven steps of International Shipping.
Not only a benefit to customers
Interestingly, the development of freight comparison sites in the logistics industry does not only benefit the customers. For the forwarder, the freight comparison websites offer an opportunity to offer their services to customers they would otherwise not be able to reach. By introducing an online sales channel and thereby increasing cargo volumes, they can reduce unit cost with increased productivity and negotiation power. The freight comparison websites enables real time rate adjustments, which allow increased utilisation of containers with consolidated shipments. This eventually benefits both the customer and the environment. And lastly, it sends a strong signal that the freight forwarder has acknowledged that going online is part of how we do business in the 21st century.
All in all, these freight forwarder comparison and booking websites are a step in the right direction of making everyone’s job less complex. Perhaps the biggest winner of all is international trade in general: with efficiency improved and procedures more visible from all angles, the waters surrounding the international trade just got (literally) much easier to navigate. Surely this is a major positive change for all in the business, and we can only encourage the shippers and consignees to try it out for themselves and learn how much time and effort freight comparison and booking sites can save you.
If you feel something is missing in this article, or have other comments or questions, please don’t hesitate to send us a comment from our contact form.