Container Shipping – How It Works and Where to Find a Freight Forwarder

The container shipping industry has existed since the 1950s, but it was in the 1960s that it became standardized. In 1967, the International Organization for Standardization (ISO) published the first edition of the ISO 8700 standard. This document outlined the requirements for containers and how shippers could use them.

In 1972, the United Nations adopted the UN Convention on Containers, which defined the term "container." The World Trade Organization adopted the WTO Rules on Containerized Transport a decade later, and these rules set out the standards for international trade and commerce.

Today, there are three main types of containers: 20ft equivalent units (TEU), 40ft TEU, and intermodal containers.

Intermodal containers are designed to carry both cargo and passengers. They are often called double stackers because they can hold twice the amount of goods compared to single-stack containers.

What Are Shipping Containers?

Strong metal boxes called shipping containers are used to move commodities worldwide. They are usually made of steel and designed to withstand long journeys, allowing them to easily transport by rail, road, and sea.

Standardized containers have transformed the global shipping industry, making it possible to move large quantities of cargo around the globe quickly and efficiently.

The approximate $3 trillion worth of trade that moves through our transport system every year could be transferred within 24 hours if we had standardized containers.

Full Container Load (FCL) vs. Less than Container Load (LCL)

The obvious answer is that you should ship full-container loads (FCL) when you have enough stuff in each container to fill it up and use less-than-container load (LCL) otherwise. But this is only partially true. There are several factors to consider here.

From a financial perspective, a fully loaded container is typically cheaper than a partially loaded one.

For example, a full container costs about $1,500-$2,000 per twenty-foot equivalent unit or TEU (20ft x 8ft), while a partial load costs about $1,200 per TEU. So a full container is usually cheaper than a partial load.

However, there are two other factors to evaluate. First, LCL has much longer transit times than FCL. For example, a 10,000 TEU container takes about four days to travel from China to the US West Coast via FCL, and a 20,000 TEU container travels for around six months via LCL.

Second, LCL requires additional handling charges. Again, these vary depending on where you're sending the goods; generally, they range anywhere from $400 to $600 per container.

What does all this mean? Pack everything into a full container if you have a lot of stuff to send. Otherwise, don't worry too much about whether you're shipping LCL or FCL. Just make sure you're getting the best possible price.

What Is a Freight Forwarder?

A logistics expert who offers various supply chain services is known as a freight forwarder. They plan the transport of commodities from one location to another.

This arrangement includes arranging ocean or air freight transport, inland transportation from origin and destination, preparation of documents, warehousing, and storage services.

The term "freight forwarding" came about during World War II when it became necessary to ship large quantities of supplies across oceans.

At the time, there were no established shipping lines, so companies had to contract out the job to individuals who could do it better. These people were called "forwarding agents."

What Does a Freight Forwarder Do?

Because they offer comparable services, freight forwarding firms and transporters are frequently mistaken for one another. There are important distinctions between the two, though.

A freight forwarder represents a middleman between a shipper and a carrier, and they act as a liaison between the two parties and help facilitate shipment movement.

While freight forwarders handle shipments and ship them worldwide, it's vital to understand what they don't do and how they work.

For example, while freight forwarders handle loads from place to place, knowing that someone else moves goods is essential.

There is one golden rule to keep in mind regarding freight forwarding: freight forwarders are not moving cargo. Instead, they're representing intermediaries.

Pros and cons of freight forwarding

Freight forwarding is an easy way to save money on shipping costs. However, before signing up for a service, you must know what you're getting yourself into.

There are several different types of freight forwarding companies out there. Some focus solely on domestic shipments, while others specialize in international trade. There are even those that provide both options.

The most common type of freight forwarding is called consolidating freight. This consolidation involves taking multiple shipments from one shipper and combining them into one package. These packages are then sent to another carrier for delivery.

Another option is called door-to-door delivery. In this case, the customer sends the goods directly to the recipient. Door-to-door delivery usually requires a signature upon receipt.

A third option is called full truckload shipment. Full truckload shipments involve sending a single container to the destination location. Once the container arrives, the driver unloads the contents onto a trailer and drives away.

While each of these methods offers competitive pricing based on services needed by a client, there are drawbacks to consider. For example, consolidators often charge extra fees for services such as customs clearance.

Full truckload shipments require a lot of upfront capital, and a customer must purchase a container, pay for insurance, and hire a truck.

Additionally, the buyer is responsible for ensuring the shipping items will fit in the container. If the item is too big, it could harm the container itself. On the other hand, if the item is too small, it might not fill up the space allotted.

If the customer doesn't have enough room to store the item, they can rent storage space instead. Although this choice costs more than a container, it has greater flexibility.

Where to Find a Freight Forwarder

To find a freight forwarder, you must first identify your needs. Next, you'll want to determine whether to move products domestically or internationally.

Once you've determined which method you'd like to use, you'll need to look for a company specializing in that area.

Referrals

You will want a company that provides quality service at a fair price. The best way to find a reputable company is through referrals.

Ask friends, family members, and colleagues who have used a specific company.

Considerations for choosing a freight forwarder

1. Experience: When looking for a freight forwarder, ask about their experience with the industry. A good company should have many years of experience under its belt.
2. Flexible payment: In addition to experience, look for a company that offers flexible payment plans. For example, many companies offer discounts for customers who pay in advance.
3. Get more than one quote: To get the best deal possible, make sure to shop around. Compare prices and terms offered by various companies.

Conclusion

Freight forwarding is a great way to save money on transportation costs. However, it comes with its own set of challenges.

Before choosing a company, know exactly what you need before signing up. You should also be aware of the pros and cons of each method and the requirements needed to ship internationally.

One of the uses of container shipping is to ship a car internationally. This process can be challenging with several considerations. For example, where it's shipped from, what documents are required, and the time needed to transport the car.

Here is where knowing the right car shipping company is an expert in the industry can be helpful. An expert auto shipper will know how to navigate the process and take care of everything to ensure your car shipment arrives safely.

A-1 Auto Transport can assist you there. We can ship cars and other vehicles via ocean freight and offer a comprehensive moving service. Thanks to our global network of freight forwarders, nowhere is out of reach.

Get a free quote today or call us at 1-888-230-9116 to learn more about sending cars abroad via container boat shipping.