Whether buying or selling products on the international stage, you need to take into consideration the cost of importing and exporting your goods.

 This will vary depending on the payment terms and who is responsible for handling the shipment, but at least one of the parties involved will need to be concerned with factors like inland transportation, customs clearance, choosing and booking space on shipping lines and all legal and contractual demands when importing or exporting goods.

The easiest and usually most economical way to deal with these problems is to employ the services of a freight forwarder. These people have the experience and connections within the industry to ensure that your cargo is handled correctly and arrives on time at the designated location. The fact that they deal with large volumes of cargo from different customers also allows them to offer lower rates than if you tried to handle these processes yourself. If you use a search engine and type in freight forwarder you will see a multitude of companies to choose from.

This is the industry I work in, and in this forum I will try to offer you valuable advice on how to choose and use these agencies and give information on related fields, to assist you in shipping your cargo in a safe and cost effective manner. I look forward to your questions and keep checking this forum for further advice on these issues.

                                                                                                  Rik.Smith from JCtrans.net

Interesting article, Rik.

To a certain extent, could the same be said of Trading companies as well, in their

field (wholesale exports) ?


The general impression one gets from Alibaba.com's various forums is that

99% of buyers do not like to deal with so-called trading companies. Perhaps if

they weren't so price-conscious, they may consider the psychology behind trading

companies too (eg: the work that goes in behind the scenes - inspecting goods,

arranging shipment, etc) and the level of expertise many of them can provide.


Most buyers seem to overlook this very "expertise" factor.


I wonder, will a day come when "buyers" start complaining that freight forwarders

themselves are - more or less - middlemen who only provide a service. It's not

like they "own" the vessel ! Why not bargain directly with the shipping companies

and save some money eh !



Anyway, just a thought !

Quoting from [rik_smith]:

Whether buying or selling products on the international stage, you need to take into consideration the cost of importing and exporting your goods.

 This will vary depending on the payment terms and who is responsible for handling the shipment, but at least one of the parties involved will need to be concerned with factors like inland transportation, customs clearance, choosing and booking space on shipping lines and all legal and contractual demands when importing or exporting goods.

The easiest and usually most economical way to deal with these problems is to employ the services of a freight forwarder. These people have the experience and connections within the industry to ensure that your cargo is handled correctly and arrives on time at the designated location. The fact that they deal with large volumes of cargo from different customers also allows them to offer lower rates than if you tried to handle these processes yourself. If you use a search engine and type in freight forwarder you will see a multitude of companies to choose from.

This is the industry I work in, and in this forum I will try to offer you valuable advice on how to choose and use these agencies and give information on related fields, to assist you in shipping your cargo in a safe and cost effective manner. I look forward to your questions and keep checking this forum for further advice on these issues.

                                                                                                  Rik.Smith from JCtrans.net

I am very glad to find this passage of explaing who are freight forwarders.

This is  holly, as a freight forwarder,from Shenzhen Barge International Freight LTD.

I am not a pragmatic person.Hope that i can have chance to cooperate with u.

Quoting from [Giant Trader]:

Interesting article, Rik.

To a certain extent, could the same be said of Trading companies as well, in their


field (wholesale exports) ?



The general impression one gets from Alibaba.com's various forums is that


99% of buyers do not like to deal with so-called trading companies. Perhaps if


they weren't so price-conscious, they may consider the psychology behind trading


companies too (eg: the work that goes in behind the scenes - inspecting goods,


arranging shipment, etc) and the level of expertise many of them can provide.



Most buyers seem to overlook this very "expertise" factor.



I wonder, will a day come when "buyers" start complaining that freight forwarders


themselves are - more or less - middlemen who only provide a service. It's not


like they "own" the vessel ! Why not bargain directly with the shipping companies


and save some money eh !




Anyway, just a thought !

Have to say, your thoughts are very smart. But I just need to ask you one question. How many goods you have monthly for shipping?   50 40'GP container? more or less? If the freight forwarder(FF) agency can have 500 40'GP, 1000 40'GP or even 2000 40'GP.  Then how you think can bargin for  the price cheaper than FF with the shipping company?  Same as courier services, we have tons of goods to ship with UPS or DHL every day, so that's why we can have much cheaper price.

Just use a quick illustration for reference to anyone who doubt about the FF services.

Two people went to the shopping. One guy want to buy 1 pair of shoes. The other guy want to purchase 100 pairs of shoes. So how much you think the shop would like to offer them? And afterwards, the first guy will find that he can have cheaper price from the other guy than from the shop directly. Above all, That's how FF works~~

Quoting from [Giant Trader]:

Interesting article, Rik.

To a certain extent, could the same be said of Trading companies as well, in their



field (wholesale exports) ?




The general impression one gets from Alibaba.com's various forums is that



99% of buyers do not like to deal with so-called trading companies. Perhaps if



they weren't so price-conscious, they may consider the psychology behind trading



companies too (eg: the work that goes in behind the scenes - inspecting goods,



arranging shipment, etc) and the level of expertise many of them can provide.




Most buyers seem to overlook this very "expertise" factor.




I wonder, will a day come when "buyers" start complaining that freight forwarders



themselves are - more or less - middlemen who only provide a service. It's not



like they "own" the vessel ! Why not bargain directly with the shipping companies



and save some money eh !





Anyway, just a thought

Thanks for your post Expert Trader, I would agree that the same could be said for trading companies in that of expertise. I will not make a direct comparison here, as I don’t understand everything that goes on behind the scenes in trading, but I will expand on some of the practices and responsibilities of freight forwarders.

Firstly I don’t believe that it would be cheaper for buyers to bargain directly with shipping lines. The forwarders that are selected by their clients are not always the forwarders that book the space on the vessels. There are much larger forwarders, in terms of space booking, which will sell space to forwarders at an even lower rate than they can get, due to the volumes they deal with. So, if even forwarders use other forwarders to reduce their costs, I don’t think that buyers will be able to do much better by themselves.

In addition there are other factors that lead me to believe that buyers will still prefer to use forwarders in the future, instead of handling these processes themselves. There can be many unforeseen problems when exporting and importing cargo that only people in the business may be aware of. Finding out these problems when it is too late may result in long delays to your shipment or even loss of your cargo.

Also the continuous changes in international regulations and procedures means that you need to stay up to date and on the ball. In my opinion freight forwarders still play an important role within international trade, and their services will still be required for years to come.

www.jctrans.net

Daniel Zhao, thanks for your kind comments.


I have been in this line of business for over 14 years and 

I know very well how freight forwarders work. I have nothing but respect for most of them.







You have overlooked my point here - that, in the pure sense - both FFs and Traders






are more or less middle-men. I was NOT knocking down FFs or saying anything






negative about them. Pls read my post from another angle and everything will be






clear.







You talk about 100, 1000 or 2000 containers per month and then ask how a normal






person can expect to get your freight rate from the shipping co. for just 2 or 3 containers,






correct ?







Then let me ask you - if I am buying 20-30 containers per month from one particular






factory, how is a new "customer" or "buyer" expecting to go straight to the factory and






get my price or cheaper for just 1 or 2 containers ? Can you see the connection now ?




No doubt, FFs add on their margins ("profit") and so do Traders. We both know these margins can obviously vary....

Now do you get my point ? You have to read between the lines here, my friend.




Perhaps the real fact is this: Relationship. The relationship that a FF has with 


a liner or shipping company and the relationship that a trader has with a factory.

Some "Buyers" need to open their eyes to this fact.

Good luck.

Rik, thanks very much for your comments. Please do not misunderstand me, I have





nothing but the greatest respect for most forwarders and - as a trader - I can fully





understand and appreciate what expertise and service they bring to our industry.





My work would be near impossible were it not for the services provided by forwarding





companies...

My point was aimed specifically at the buyers who constantly put-down trading companies





and go on and generalize about them all being the same. Perhaps if they were to 





educate themselves a bit more, they would see things from a different perspective. 






I guess I took the stage - on the back of your well-stated post - to sort of bring in the





similarities into focus, so certain people can see things from the trader's perspective





as well. That there's a reason why "middle-men" charge a fee for their services.I could





go on about this topic but I'm sure an expert like you can understand where I'm coming





from.

Good luck.

I used to work for a freight forwarder company, which has no relation with the shipping company and took the price from other fowarders but still exist. the reason is they provide better service for the clients. However, just as middleman does, they did add their margins, actually there're plenty of company sell service rather than products in nowadays society. Now I worked for a  factory and began to understand a little bit more about the workers' hardship.

You are right, Katherine. I wish certain "buyers" could also see this aspect.

Quoting from [Giant Trader]:

Interesting article, Rik.

To a certain extent, could the same be said of Trading companies as well, in their


field (wholesale exports) ?



The general impression one gets from Alibaba.com's various forums is that


99% of buyers do not like to deal with so-called trading companies. Perhaps if


they weren't so price-conscious, they may consider the psychology behind trading


companies too (eg: the work that goes in behind the scenes - inspecting goods,


arranging shipment, etc) and the level of expertise many of them can provide.



Most buyers seem to overlook this very "expertise" factor.



I wonder, will a day come when "buyers" start complaining that freight forwarders


themselves are - more or less - middlemen who only provide a service. It's not


like they "own" the vessel ! Why not bargain directly with the shipping companies


and save some money eh !




Anyway, just a thought !

Yes,usually for shipping service,maybe it is more cheaper for people to bargain with shipping companies since they have their own vessels.And if the importing company have large amount,they can make a contract with them and get vip service.

I work in a forwarder company,we also do the shipping service,but i still agree with you on that.Just sometimes,when people don't  have goods all year long,maybe just once or twice,then people won't be willing to bargain with the shipping company,they just give goods to forwarders for handling,it is much easier.

For other services,like express delivery and air service,take us for example,we usually get better discount from the UPS,DHL,EMS,TNT,FEDEX,because we can give them goods each day in large amount.So we can get better price than some business person to bargain with the agent  themselves.In this time,the forwarder is like a department of a company,mainly responsible for importing goods for the company.And the profit is like the salary they get for the work.

For people to ship goods,usually compare more,and the try to ship small weight first,then slowly build up trust with each other.