10 TIPS on work­ing with freight for­warders

Dr Ro­muald Rudzki of­fers some prac­ti­cal ad­vice to help you get the most value from your freight and lo­gis­tics part­ner.

Exporter - - ADVICE -

That happy mo­ment when an ex­port ship­ment fi­nally leaves your premises and starts its long jour­ney to your cus­tomer is of­ten a cause for great re­joic­ing. But in many ways it is only the start of your trou­bles, be­cause your prod­uct is no longer in your hands but with the next link in the sup­ply chain – namely the freight for­warder. And freight for­warders come in all shapes and sizes, from lo­cally-based smaller firms to global multi­na­tion­als.

Here are some tips on what to ask, and how to get the best out of, the for­warder you choose:

Have you done this be­fore?

Pick a for­warder who ships your prod­uct (e.g. honey) to your mar­ket (e.g. Ja­pan) on a reg­u­lar ba­sis. They should know what, in par­tic­u­lar, is re­quired in terms of pack­ag­ing, ex­port doc­u­men­ta­tion and so forth.

What mode do you want?

From New Zealand you have two choices: (1) sea freight (95 per­cent of ex­ports) or, (2) air­freight (five per­cent). Don’t as­sume air­freight will be nec­es­sar­ily more ex­pen­sive as deals can be of­fered, es­pe­cially for reg­u­lar ship­ments.

Sea freight is no­to­ri­ous for catch­ing out in­ex­pe­ri­enced ex­porters who are given an ad­di­tional bill months later for the ‘Bunker Ad­just­ment Fac­tor’ – ad­di­tional costs based on all the goods car­ried by the ship and then di­vided up amongst the cus­tomers.

Know your In­coterms!

De­pend­ing on what you have ne­go­ti­ated as part of the terms and con­di­tions of sale, your costs for freight will vary from an Ex-Works (EXW) price to DDP (De­liv­ered Duty Paid) and ev­ery­thing in be­tween. For the cur­rent 2010 In­coterms go to www.ic­cwbo.org

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