Finding the right freight forwarding company can be overwhelming and challenging. This daunting task discourages many Amazon sellers from getting involved with FBA – fulfillment by Amazon.
There are lots of things that can go wrong when transporting goods which will end up costing you a lot of money- shipping containers getting lost at sea, hidden charges eating into your profit margin, or paperwork issues causing problems at customs.
Setting up a good supply chain is very important for your business, especially for overseas shipping, but often gets overlooked In favour of promoting sales. But there is no point hitting big sales figures if you have difficulty fulfilling the orders due to problems with your supply chain.
Many sellers use parcel delivery services because it is familiar to them, and nobody likes change, right? But these services are not cost effective when you have large items or a big load of cargo that needs to be transported.
In those circumstances, you would be better off with a freight forwarding company. That’s not to say that using a freight forwarding company is all plain sailing- it comes with it’s fair share of potential problems too.
We have put together some information on how to go about choosing the best Amazon FBA Freight Forwarder to make it easier for you to run your business smoothly.
We have also included some recommendations to help kick start your research into which company is the right choice for you and your business.
Restrictions
The first thing you need to do before you consider international shipping, is check the customs restrictions. Are you able to get your product into the desired country? Are there any additional charges for the product you are planning to ship?
You will be surprised at which products carry additional charges and which don’t. You also need to consider the packaging that the product comes in – a leather pouch for jewellery will have different regulations to the jewellery itself.
The packaging also makes a difference to the size and weight of the packages, which can impact the freight cost.
Another thing to consider with international shipping is patent and copyright – make sure you have the correct permissions and licensing to sell the products, or you could end up being lumped with unforeseen charges.
Pricing
Many sellers will be tempted to choose the freighting company that offers the lowest upfront cost, but this can be deceptive.
There may be hidden charges later on down the line, and some companies will try and hold the seller to ransom by withholding the location of their goods until those sneaky surcharges are paid. This can cause a lot of stress, delays, and can end up costing much more than you initially thought.
A trustworthy freight forwarding company may have a bigger quote upfront, but it will be detailed and lay out exactly what the charges are and how they will be incurred.
It is much better to know from the beginning how much everything will cost so there are no nasty surprises along the way, and you know your goods will be delivered safely.
Transparency is important – the company should be able to clearly explain exactly what each charge is and why it is necessary. Make sure you do some of your own research into customs duties so you have some background knowledge to help you scrutinize the quote.
If they think you are clueless they might try to take advantage and get more money out of you. You can use an online duties calculator to get a rough idea of what you should be paying, so you know whether the quote is reasonable or not.
Communication
Even if you choose a reliable freight forwarding company, E-commerce and international shipping will always have an element of uncertainty and unpredictability. It can be chaotic and unforeseen issues can cause delays that you weren’t expecting.
It is very important that the freight forwarding company you choose keeps you updated every step of the way and displays good communication.
Ask any prospective companies what methods they use to track their shipments so you can be confident that your goods will be in safe hands.
When you are looking for a company to use, pay close attention to how they communicate with you, even over small things like quotes and setting up meetings. This will set their scene for their attitude towards clients.
Be sure to check the international presence of any company you are considering working with- will they be able to communicate with you directly across different time zones, or will they be using a middle-man?
This can make a big difference to the overall experience and how smoothly the process will go. If there are any additional partner companies involved then it isn’t necessarily a bad thing, but you need to know about them.
Remember, you are the client and you have multiple options of companies you could use- you have the upper hand.
Set out your expectations for communication from the beginning to ensure that the company knows what standards they will need to meet in order to retain your custom. Clear communication works both ways!
Experience
Online shopping is becoming more and more popular, and is shaping up to be the future of retail. You need to work with a freight forwarding company that has embraced this development and works proactively to keep up with the ever changing market.
They must be familiar with all elements of E-commerce, especially the strict FBA (fulfillment by Amazon) guidelines.
Choosing a company that has a good understanding of the guidelines, such as the rules around packaging and deliveries, will save you a lot of hassle.
They will already have a good grasp of your priorities as a seller and know how to work with you to ensure that they do not hinder you in any way.
Find a company that will help you to minimize your door-to-door costs rather than your port-to-port costs. A competent company will be able to explain how they can help you with this.
Freight Terms
Freight Terms, or ‘Incoterms’, will determine what liability you hold and what falls on the freight forwarding company. There are various setups to choose from depending on the company you decide to work with.
You will need to consider your budget and your profit margins to find an option that works for you. If the company works with partners at various international ports, their partners may pick up some of the costs and liability as part of their arrangement.
This can sometimes save you money, but make sure you have a good understanding of the process and the supply chain. Regardless of which freight terms you choose, the most important thing is that you are confident in your knowledge of where your responsibilities begin and end.
Courier, Air or Sea?
There are different ways to transport your goods, and whether they are cost efficient will depend on the size of the shipment. The general consensus is that packages less than 150kg should be sent via courier. Anything more than 150kg and a courier is no longer cost efficient.
If the package is between 150kg and 500kg then you should send it via air. If the package is more than 500kg then the best way to send it is by ocean freight.
You also need to consider the timescale, as transporting goods via ocean freight takes a lot longer than sending via air. Some products are not able to be transported via air as they are not allowed on planes, like lithium batteries, for example.
Top Tips
Many sellers will want to palletize their shipment, but this can potentially cause issues. Adding pallets to an air shipment can significantly increase the cost, whilst wooden pallets may need to be fumigated which can cause delays.
The best option is to wait until the products have been through customs before palletizing the shipment.
International shipping is not always a gentle journey, and some products could get damaged along the way. Make sure fragile items are packed carefully with extra support to reduce the number of breakages and prevent a negative impact on your profit margin.
There is a fine line between under marking and over marking your packages. Your shipment may get consolidated with someone else’s, depending on the size, so you want to make sure your products are easily identifiable to prevent any from going missing.
However, if it is too obvious what is inside the packaging then this can be a big temptation for thieves. Try to avoid branding that might make your shipment a target for theft.
Freight Forwarding Companies
Flexport is a freight forwarding company with a modern vision. They want to update the old-fashioned, paper based systems associated with freight forwarding to create a more strategic, transparent and efficient business model.
This will improve profits for them and for their clients. They are able to realize this vision with the help of modern technology that connects all elements of the process, from importers and exporters to customs and ports.
They have a good infrastructure and are experts in supply chain management. You also have the option of extra services like customs brokerage and cargo insurance.
Freightos is an interesting business that works with freight forwarding companies to get their clients the best deals. By working with a range of companies, and multiple clients with varying sizes of cargo, they are able to achieve pricing often reserved for sellers with bulk cargo.
This also gives sellers the option to switch freight forwarding companies for different shipments, which allows for much better flexibility. This is a great option for smaller businesses who are just starting out with freight forwarding.
First Choice Shipping have been working alongside Amazon 2015, so they have relevant experience that will make the process run much more smoothly for you. As well as shipping, they also help with setting up Amazon seller accounts, VAT registration, invoices, tax calculators, and various warehousing services.
This is not just a freight forwarding company, but an end to end service that will really take a load off for sellers.
Shippo is a freight forwarding company that aims to simplify what is a fairly complex process, to take the strain off of sellers and business owners.
Their website is an encyclopaedia of information on shipping, customs, importing and much more- a perfect example of transparency! They also have testimonials from happy customers, so you can feel comfortable that they are a company you can trust.
M.E. Day & Co is a long established company with a reliable global network. They can help businesses with all aspects of international trade, with in-house specialists on a range of topics including logistics, customs brokerage, import/export and compliance.
As one of their clients you would have 24 hour access to the status of your shipment through the web tracking programme, which will help to give you peace of mind.
The business prides itself on their core values of respect, honesty, integrity and professionalism, so you know your shipment will be in safe hands.
Summary
Nobody knows your business better than you do. Choosing which companies to work closely with can be challenging, but if you do your research and trust your instincts then you should be able to make a great decision.
Remember to read up on your products, any relevant restrictions, and the approximate customs and duties charges before you approach a freight forwarding company for a quote.
Consider the weight of the packages and the size of the shipment to ensure you have chosen the most cost effective mode of transport. Make sure you understand every element of the quote and you are not overlooking any hidden charges.
You also need to ensure that you familiarize yourself with all elements of the contract so you know what to expect, and what will be expected from you. And finally, make sure the freight terms meet your needs and fit with your budget.
