There are many steps involved in getting materials and wares shipped from your supplier to your own warehouse or customers.
Often, you won’t know how many stops your shipment’s made along the way and how it got to where you are. This is especially true for international deliveries that cross borders and seas.
As a business owner, you may want to get a clearer idea of what’s involved in the shipping process.
Below you’ll find a step by step outline of the various destinations a shipment passes through before it rests safely at your doorstep.
Beware – many of these processes represent hidden costs. That’s if you haven’t agreed on whether your company or the shipper carry financial responsibility.
Each agreement is different, so your exact involvement and costs hinge on your contract.
1. Export Haulage
The first journey your cargo undergoes is often conducted via truck or train. It is the journey from your shipper to the forwarder’s origin warehouse.
This part may take anything from a few hours to a few weeks. It might be your responsibility to arrange export haulage unless your agreement states you’re later involved in the shipping process.
As export haulage occurs local to the shipper, it’s (usually) sensible to let them take responsibility for this part of the journey. That’s if your freight forwarder doesn’t offer this as part of their service.
A freight forwarder is a party that handles the majority of communication and organization concerning the safe delivery of your wares.
They handle the customs clearance and required documents. They present the shipment to you, the consignee, as one integrated process. Large freight forwarding companies include DHL, Schenker, and Panalpina.
2. Export Customs Clearance
You need to submit the documents detailing the nature and inventory of your cargo.
This is usually handled locally by either the shipper or the freight forwarder, and once again needs to be detailed in the agreement.
Local knowledge is often required, so if the consignee is handing the arrangement of the documents for export customs clearance, it would be advisable to contact a freight forwarder to step in.
3. Origin Handling
Handling cargo at the origin warehouse includes several processes such as the unloading of cargo from the truck it arrived on into a staging area, to counting and inspecting of the wares.
The inventory is checked against the booking details, and a receipt is issued to the shipper to confirm they’ve received the wares. Then they’re checked into the origin port.
The cargo is then placed in a stack in the origin warehouse for consolidation with other wares going to the same destination. A few days before the vessel departs from the origin port, the cargo is trucked to the port and placed in a shipping line container.
The freight forwarder usually performs origin handling. But, the cost lies with either the shipper or consignee, depending on the agreement.
4. Ocean Freight
The transport of the wares across the ocean is dealt with via the contract established by the freight forwarder.
It’s not usually necessary for the consignee to get involved with this process. Nor will they typically know which ship their cargo is on. The transportation may consist of changing vessels at several ports.
The shipping company will charge the transportation directly to the freight forwarder, who then breaks up the cost of the various wares amongst their different customers.
When assessing the services of a freight forwarder, it’s vital to make sure the surcharges of the shipment are included in the price early on.
5. Customs Clearance
Clearance is usually paid by the consignee and can be arranged by the freight forwarder holding an official license.
It must be completed before any cargo enters a country. This is considered the point at which a ship crosses a border.
Customs clearance usually involved reporting which and how many wares are being shipped into a country.
6. Destination Handling
Just like origin handling, destination handling is also performed by the freight forwarder or his agent at the destination port and warehouse. Only they are allowed to pick up the wares from the port and truck them to their premises.
The processes include the collection, unstuffing, and inspection of the wares. They’re also sorted for either collection by your company or delivery.
Destination Handling is paid for by either the shipper or consignee, depending on the agreement.
7. Import Haulage
This is the step where the cargo is finally transported from the freight forwarder’s destination warehouse to the premises of the consignee.
This step may include several destinations where the forwarder may be using optimal truckloads to transport several wares more efficiently. This could also be completed by a local trucking company and be arranged directly by the consignee.
Just like export haulage, it may take anywhere between a few hours and a few weeks, depending on the distance to the consignee and the number of in-between destinations.
If you don’t already have connections with local freight truckers to handle your import haulage, the freight forwarder may be able to perform this service or may be able to recommend a company that suits your needs.
Either way, Import haulage is usually billed to the consignee, so you should research beforehand how you could save money on the transport from the local warehouse to your door. Shipping LTL Freight might be a great place to kickstart your research.
That’s It for the Shipping Process
After many steps in the shipping process, your company finally has the materials it needs.
Now you know what to expect from an international shipping process and what steps are undertaken along the way.
After reading this article, you may understand that costs and responsibilities depend on the agreement you can strike with your shipper and freight forwarder.
Be sure to research where handling the responsibility for a step by using a local company of your choice might be able to save you some money in the process!