Unveiling The Secrets Of FBA Freight Forwarder Charges

How do FBA freight forwarders charge for their services?

 

FBA freight forwarder charges its clients just like any other forwarding company.

There are various elements involved in the shipping process, so calculating the actual cost of any forwarding service is not an easy task.

Here is a breakdown of various shipping elements that might be paid when choosing the FBA freight forwarder.

 

1. Carrier charges

The most obvious one is the carrier cost.

No matter what kind of transport you choose, you have to pay for it.

In practice, sea delivery is the cheapest, while the air freights is the costliest.

You might think that the distance affects the cost of delivery the most.

However, this might be not the case at all.

Moreover, forwarding agents can always negotiate for low carrier costs on popular routes.

 

2. Container cost

While shipping through the sea, you will be charged in one of these two ways:

• FCL (Full Container Load).
• LCL (Less than Container Load).
• Going with LCL is a cheaper option in the vast majority of cases (in particular, when you do not have many goods to fill the container).

On the other hand, there might be a cost involved while separating the shipments at some point.

 

 

3. Cargo type

Some goods (such as perishable items, hazardous materials, or things that require careful handling) cost higher to ship when compared to others.

It might be because they need a special container or package to transport such products.

Goods that do not fit into standard containers or that require any specialist equipment (like a crane) to load and unload will require more money to ship.

 

 

4. Cargo volume and weight

The size and weight of your products can significantly impact the final cost of shipping.

The chargeable weight is estimated by converting the total volume into weight equivalent.

So, the chargeable weight will be the greater one.

It could be either the computed volumetric weight or the actual weight.

There might be times when two shipments can have the same weight.

In such cases, the one that has greater volume costs higher to ship.

 

 

5. Packaging and palletization

The goods might need to be palletized as well as packed in a particular way for safety.

Remember that the better part of FBA freight forwarding companies charges additionally for packaging.

This is because the FBA shipments need to be packed according to special rules introduced by Amazon.

This also ensures that your goods adhere to the government rules applicable at the point of final destination.

 

 

6. Insurance

Leaving your goods uninsured can be vulnerable to your business.

International transportation is connected with various risks which are not always controllable.

Therefore, it is important to protect your shipments with cargo insurance.

This service is something that most freight forwarders will offer as an extra thing.

Before you apply for it, ask your forwarding agent if the insurance is incorporated in the quotation or it is available only as an add-on.

However, if the forwarder does not offer cargo insurance, you will have to buy it from an insurance company directly.

 

 

7. Documentation cost

Forwarding agents also provide the services connected with the necessary documentation for transportation.

This could be imported/export paperwork, Bill of Lading, as well as various invoices.

Such costs are typically included in the upfront estimate.

Products which need special documents (like restricted or hazardous materials), will incur an extra charge.

 

 8. Destination cost

Speaking of the destination costs, there are multiple nuances involved in the process.

This includes:

• Terminal handling charges.
• Charges to clear the goods from the loading and discharge ports.

Besides, a port might also require an extra security surcharge.

Besides these, other possible destination costs might include:

• warehousing fees;
• unpacking (the cost to split the LCL shipments);
• inland haulage cost (if required).

 

 

9. Administration cost

As you may already assume, the use of freight forwarder services can save you a lot of time and energy.

However, the forwarding agent does not provide such services for free.

There will be an administration charge, which will be a part of the quote.

And this is something you must pay attention to when choosing your FBA forwarding agent.

 

 

10. Additional surcharges

A carrier can apply a fuel surcharge to protect themselves from variations in the fuel costs.

Such a procedure is known as BAF (Bunker Adjustment Factor).

Besides BAF, it can also charge something called CAF (Currency Adjustment Factor) to guard them against:

• Currency fluctuations.
• War risk surcharges.
• Security surcharges.
• Peak season surcharges.
• Demurrage penalty (if there is a delay in loading/unloading).

 

 

11. Additional services

A few freight forwarders provide extra services to handle the entire shipping process from one end to the other.

This might include product sourcing, packaging to unpacking, organizing, warehousing, distributing, and delivering them to the right customers.

 

When you compare the quotes of different freight forwarders, it is vital to understand what exactly is included in the estimate so that you can know which quote offers the best value for money.