The U.S. is the world’s largest economy and the largest exporter and importer of goods and services. Trade between it and other countries is important whereby it raises living standards, provides employment and enables consumers to enjoy a greater variety of goods.
While exporting can greatly contribute to a firm’s economic growth, it can also be a time-consuming process for shippers. Global supply chains are complex and require involvement by various professionals who must execute different tasks.
Two of the most important parties involved in an international shipment are the freight forwarder and the customs broker. Many shippers use both, however, the freight forwarder and customs broker can be independent of each other. While seemingly fulfilling the same role, both satisfy different requirements of trade businesses, and each delivers an advantage which their clients would not be able to achieve in other ways.
Related: WHAT DOES A FREIGHT FORWARDER DO, AND DO YOU NEED ONE?
What is a freight forwarder?
Freight forwarders are commonly known as the “middleman” and are focused on the management of the logistics and physical transportation of cargo. They serve as intermediaries between the shipper and the shipper’s customer thus, reducing any stress and allowing the shipper to focus on what he does best.
Indeed, forwarders collaborate with the various transportation providers who handle the shipment whether it is by truck, ship, plane, rail or a combination and they monitor the shipment from origin to destination to ensure it arrives on time and not damaged. The freight forwarder also is responsible for the completion of a variety of documentation and compliance filings to ensure the shipment is compliant and will not suffer any unnecessary delays or financial fines.
Need a reliable freight forwarding service? Contact Alba Wheels Up for more information
What is a customs broker?
The Department of Homeland Security defines a customs broker “as a private individual, partnership, association or corporation licensed, regulated and empowered by U.S. Customs and Border Protection (CBP) to assist importers and exporters in meeting U.S. government requirements governing imports and exports.” In other words, a customs broker serves as the intermediary between the importer and the government’s customs department in the country of import.
Brokers submit the required information and appropriate payments to governments’ customs authorities on behalf of their clients and charge them a fee for this service. They must have expertise in the entry procedures, admissibility requirements, classification, valuation, and the rates of duty and applicable taxes and fees for imported merchandise. For countries such as the US, the customs broker must pass an examination to be licensed to operate.
Need a customs broker service? Contact Alba Wheels Up for more information
Differences between freight forwarders and customs brokers
The main difference between a freight forwarder and customs broker is that the freight forwarder deals with the logistics of actually moving the shippers’ goods from origin to destination. A forwarder contracts directly with carriers to secure bookings via ocean, air, rail or truck as well as advise shippers of estimated freight costs, port charges, costs of special documents, insurance costs and terminal handling fees.
The customs broker, on the other hand, deals with the bureaucratic side, document completion, and ensuring the shippers’ goods are moved into or sometimes out of a country. Customs brokers typically focus on the import side of an export transaction and have direct contact with various government agencies, including the Department of Agriculture, Consumer Product Safety Commission, FDA and of course the U.S. Customs Border and Protection.
Due to the complexity of importing goods into the United States, many importers hire customs brokers to help clear U.S. import shipments. Individuals are able to self-clear goods for their own account, but corporations, partnerships and associations rely on licensed brokers to navigate the various facets of “customs business”.
Freight forwarders without licensed customs broker capabilities often work together with a customs broker in order to help facilitate issues with an export transaction.
Can a freight forwarder take care of customs brokerage?
Many freight forwarders can be customs brokers but not every customs broker is a freight forwarder. Alba Wheels Up is both a forwarder and a customs broker, a valuable benefit for shippers.
An international logistics partner which is both a freight forwarder and customs broker can help importers and exporters make smart routing and mode selections that produce economical solutions to meet a specified delivery time frame.
Market channels, distribution operations, and the individual needs of each importer and exporters require a relationship that thoroughly understands the shipper and his operations. Alba Wheels Up’s unique specialty is providing such expert assistance and end-to-end management.
At Alba Wheels Up, shipments are always handled the right way by the right team. There is always someone available who can provide answers and solutions when problems arrive no matter the time of day. In addition, the company advises shippers on upcoming regulations so that when Customs implements changes, shippers are already well-positioned to minimize disruption to their operations.
Related: Our approach
Which does your company need?
Shipping logistics is difficult no matter which option a shipper chooses. Regardless of choice, moving goods globally requires a partner to be detail-oriented, and meticulous. Of course, there is always the option for the shipper to handle it on his own, however, these transactions are always best handled by an expert.
Hiring a company that is both a freight forwarder and a customs broker can make the import and export process convenient and seamless.
Indeed, Alba Wheels Up has over six decades of expertise as a customs broker and also one of the most advanced customs brokerage operating systems. In addition, its freight forwarding services are second to none. Combined, the value Alba Wheels Up brings to shippers is fast, efficient, and compliant cargo release that accelerates speed to market.
Conclusion
Global trade is vital for economic growth. However, trade has become increasingly complex and requires a number of professionals to coordinate, transport and clear shipments. Shippers have the option of handling their own shipments or partnering with either freight forwarders or customs brokers, a combination or a firm that handles both functions.
Understanding what each offer is important in order to maintain efficient supply chain operations and meet the time requirements of the shipper and the market.
While a freight forwarder arranges for cargo to travel from an origin to a destination within a specific time frame, a customs broker is responsible for preparing and clearing a customs entry upon shipment arrival to a port of entry.
There are benefits with each option however, using an experienced firm that can handle both functions can be not only be a time saver but also reduce logistics costs.
A forwarder contracts directly with carriers to secure bookings via ocean, air, rail or truck as well as advise shippers of estimated freight costs, port charges, costs of special documents, insurance costs and terminal handling fees.
At Alba Wheels Up, a person is always available to assist and answer any questions. The company also has an innovative ERP operating system that provides cloud-based software solutions for the international and domestic logistics industries. It integrates seamlessly with a shipper’s business and streamlines processes and increases the efficiency, visibility, and profitability of shippers’ operations.
