Welcome To Same World Networking

Sameworld.net is the networking blog for Supply Chain Specialists interested in creating channel partners around the globe.

A key essence for success in a new market is to identify the ‘Right Partner’. We appreciate the huge importance of this aspect and are willing to invest the necessary time and effort to get it right. There is NO substitute for "Grunt Work" and it is essential to meet the prospective partner, understand their technical capabilities, visit their manufacturing unit and assess the management team. With the partners who add to this blog we hope to achieve that. Mark Kennedy Same World Trading

Monday, 9 August 2010

The Hidden Costs to Freight Forwarding

There is no real science to the hidden cost, but many companies chose the CIF route because it is easier, so they think, and therefore hidden costs can be inevitable.

Importers face higher freight costs under CIF terms because the supplier chooses the freight company and is inclined to mark up freight costs for the extra service provided in arranging shipments. There are several reasons for this:

1. The shipper does not have the vested interest or the leverage, to get the best freight price.
2. The shipper pays for the insurance; which there may be substantial surcharges.
3. Currency rates fluctuate widely and the shipper may charge additional cost to cover them.
4. Import quotas, bad weather, and other problems may add additional unexpected cost, which the shipper will cover using a higher rate.
5. The shipper will charge a higher rate to cover its administrative costs for licensing, storage, loading, and other activities.

Hidden Costs

Trading Incoterms used to be limited generally to “Cost, Insurance, Freight” (CIF). CIF terms include all insurance and freight charges in the shipping price, making verification of the charges for freight and insurance difficult.

CIF terms can also involve reporting and information delays and incorrect or insufficient shipping documentation. This creates problems as companies increase their number of overseas suppliers and overall freight volume, and can find it harder to obtain information and mange their inbound shipments.

As a result, CIF shippers often build substantial additional freight charges into their rates, which often are not itemized for the importer.

For Greater Control you should use use “Free on Board” (FOB) Incoterms, giving you greater control over their shipments and eliminating the hidden shipping costs that create inefficiencies. Increased supply chain visibility and the control of import shipments are critical FOB benefits.

By taking control as cargo crosses the ship’s rail at the port of origin, importers are better able to obtain accurate and timely shipment information by working with their choice of third party logistics provider.

If you are shipping at present then perhaps you could do with looking at a Freight Audit which Same World Trading can offer a free consultation and a no gain no fee basis.

If you’re not shipping yet but are about to or are thinking about it I can recommend a Freight forwarder who can help you with your new venture or we can offer the full service with Quality Control for your manufacture base, or looking for suppliers. We also offer a representation for your company via our Indian or Chinese offices.

Contact me via www.sameworldtrading.com

Mark Kennedy


  1. Such a great detail have been post by you regarding freight forwarding. Really appreciate your research on such topic and provides the great knowledge to all of us. For any detail about Air Freight Forwarders then GM International Freight Forwarders, Corp. is good option for you.

  2. I was roaming Google for some cool music and videos of my favorite artists and I ran across your cool blog site, most on the time when I check out blogs I’m looking for anything particular and I leave right away after. But as part of your situation the info you’re giving in this write-up produced me wish to reply and show my appreciated, so We have bookmarked you blog as properly. Retain posting and thank you! =) international transport

  3. Very informative article that you have shared here about the freight forwarding. Your article is very useful because it nicely describes the hidden costs of freight forwarding. Thanks for sharing this article here. Fast cargo to Pakistan

  4. I read your post and got it quite informative. I am impressed by the details that you have shared in this post and It reveals how nicely you understand this subject. Thanks for sharing this article here. shipping from China to Canada

  5. we’re FOCUSED ON DELIVERING great service and EASY to work with Domestic Air Freightand International Air and Sea Shipping solutions
    international freight

  6. Cargo Master is an Australian international freight company , renowned for delivering, flexible cost effective air and sea freight forwarding services. sea freight

  7. Companies that provide international freight forwarding services are usually third-party logistics providers like Cargo Master that offer professional import and export urgent air freight and sea cargo services. Freight Forwarders

  8. http://blog.innovateyoursupplychain.com/2010/05/freight-rates-on-rise-knowing-your.html?showComment=1559262889368#c1856475955510999884

  9. Cargo Master offers a vast array of international freight services including, International Shipping Containers for anyone looking to relocate overseas and air freight charter services for larger shipments or project air cargo. Freight Forwarders Melbourne

  10. delivering great service and easy to work with domestic air freight services and international air and sea freight service to and from sydney SYDNEY FREIGHT SERVICES

  11. Very informative article, Which you have shared here about the Hidden Costs of Freight Forwarding. After reading your article I got very much information about the hidden costs of freight forwarding businesses and It is very useful for us. tradeimex offers the best global trade custom data analysis report at the affordable price.

  12. self pack international shipping container are available from all australian capital cities to most worldwide centres SEA FREIGHT

  13. Professionals in international shipping of earthmoving equipment and heavy industrial machinery via international sea and air freight. SEA FREIGHT MELBOURNE

  14. This post is so informative and makes a piece of very nice information on the topic in my mind. It is the first time I visit your blog, but I was extremely impressed. Keep posting as I am gonna come to read it every day. Import Export shipment data

  15. As we know that if we transport any goods in another countries it takes long time. as we have Freight Forwarding Services at affordable prices. for more info visit our website.

  16. Well, thanks for sharing the information about freight services. as we also provide the freight services in miami at affordable prices. for more info visit our website.

  17. You make so many great points here that I read your article a couple of times. Your views are in accordance with my own for the most part. This is great content for your readers. europa-road.eu

  18. AB Paving is a Burnaby-based paving contractor that is well-known for offering a wide range of premium Asphalt Paving Amarillo TX