Amazon Freight Forwarders: The Complete Guide for Sellers
Table of Contents
- What Is an Amazon Freight Forwarder?
- What Does a Freight Forwarder Do?
- How Does a Freight Forwarder Work?
- What Is an Example of Freight Forwarder?
- Freight Forwarder Terminology and Their Roles
- Shipping Terminology
- Who Pays the Freight Forwarder?
- Amazon FBA Freight Forwarders: Costs and Fees
- Does Amazon Offer Freight Services?
- Is It Necessary to Have a Freight Forwarder?
- Benefits of Using a Freight Forwarder for Amazon FBA
- When Should You Use a Freight Forwarder?
- What Is the Liability of a Freight Forwarder Agent?
- Amazon's Terms and Conditions for Freight Forwarding
- What Is the Best Incoterm for Amazon FBA?
- How Do I Choose a Freight Forwarder?
- What Is the Most Important Criteria in Selecting a Freight Forwarder?
- What Information Does a Freight Forwarder Need?
- How Do I Set up an Amazon Freight Forwarder?
- How Can I Ship to Amazon for Cheap?
Welcome to the ultimate guide for sellers on freight forwarding! If you are an e-commerce entrepreneur looking to navigate the complexities of international trade and optimize your shipping operations, you’ve come to the right place. In this comprehensive guide, we will explore everything you need to know about freight forwarding – from understanding their role in the supply chain to the benefits they offer for FBA sellers. Get ready to unlock the secrets of seamless shipping and expand your business globally with the expertise of freight forwarders tailored specifically for Amazon sellers. Let’s embark on this journey together and take your e-commerce venture to new heights with FBA!
What Is an Amazon Freight Forwarder?
Amazon Freight Forwarder refers to a third-party logistics (3PL) company that provides shipping and freight services for businesses selling products on Amazon’s e-commerce platform. These forwarders specialize in coordinating the transportation of goods from the seller’s location (manufacturer or warehouse) to Amazon’s fulfillment centers, where the products are stored and later shipped to customers.
According to Amazon, “Shippers can leverage Amazon’s supply chain capabilities and technology, in addition to 30,000+ Amazon-owned trailers and 30,000+ trusted carriers to meet your shipping needs. We offer the dependability, reliability, tracking, and high performance you deserve from your shipping partner. Our network runs 24/7, 365 days a year, and as a part of Earth’s most customer-centric company, we’ve built easy-to-use solutions to ensure visibility from quote to payment.”
What Does a Freight Forwarder Do?
A good freight forwarder handles various aspects of the shipping process, including:
- International shipping: Coordinating the movement of goods across borders for sellers who import products from overseas manufacturers or suppliers.
- Customs clearance: Assisting with documentation and compliance requirements to ensure smooth customs clearance of goods at international borders.
- Freight management: Selecting the appropriate shipping method, carrier, and routes to optimize cost and delivery time.
- Warehousing: Some freight forwarders offer warehousing services, where they store inventory on behalf of sellers until it’s ready to be shipped to Amazon’s fulfillment centers.
- Last-mile delivery: In some cases, freight forwarders may handle the last-mile delivery, which involves transporting products from the Amazon fulfillment center to the end customer.
Using an Amazon Freight Forwarder can benefit sellers as it simplifies the complexities of international shipping and logistics, allowing them to focus on their core business operations. Additionally, it can help reduce shipping costs and transit times, improving the overall customer experience.
How Does a Freight Forwarder Work?
A freight forwarder is a mediator in the supply chain that coordinates the efficient movement of goods. They handle booking, documentation, customs clearance, and transportation using various modes (sea, air, rail, or trucking). Freight forwarders may consolidate shipments, offer warehousing, and provide last-mile delivery. Their expertise ensures smooth shipping and problem-solving during transit. Businesses rely on experienced freight forwarders for reliable and efficient logistics support.
What Is an Example of Freight Forwarder?
One example of a well-known freight forwarder is DHL Global Forwarding. DHL is a division of the German logistics company Deutsche Post DHL Group, and DHL Global Forwarding specializes in providing freight forwarding and supply chain solutions worldwide. They offer a wide range of services, including ocean, air, road, and rail, catering to domestic and international shipping needs.
DHL Global Forwarding assists businesses in managing the complexities of shipping and logistics, offering services such as customs clearance, cargo tracking, warehousing, and distribution. With its extensive global network and expertise in freight forwarding, DHL is widely recognized as a trusted and reliable partner for companies seeking efficient and streamlined shipping solutions.
Other similar examples of freight forwarders we support using when transporting your own shipment include Forceget, Unicargo, Frisbi, and those listed in our Seller Solutions Hub directory.
Freight Forwarder Terminology and Their Roles
The consignor or shipper is the person or company who is the owner or supplier of the goods being transported. They are responsible for initiating the shipment and handing over the cargo to the freight forwarder for transportation.
A freight forwarder is a third-party logistics provider that arranges and manages the transportation of goods on behalf of the shipper. Their role involves coordinating the movement of cargo, handling documentation, customs clearance, and selecting appropriate carriers and routes.
A shipping agent is a representative or intermediary who acts on behalf of a shipping line, airline, or other carriers. They handle various tasks related to cargo and vessel operations, including booking cargo, documentation, port arrangements, and coordinating vessel services.
Bill of Lading (BOL)- The Bill of Lading is a critical shipping document issued by the carrier or freight forwarder to the shipper. It serves as a receipt of the cargo, a contract of carriage between the shipper and the carrier, and a document of title, allowing the recipient to claim the goods upon arrival.
Export License- An export license is a government-issued document that grants permission for the export of specific goods to certain destinations. It is required for goods that are subject to export control regulations to ensure compliance with trade laws and national security interests.
Inspection Certificate- An inspection certificate is a document issued by an authorized party (such as an inspection agency) after inspecting the goods. It verifies that the goods meet the required quality, quantity, and specifications as per the agreed terms.
Commercial Invoice- A commercial invoice is a document prepared by the seller and provided to the buyer, detailing the description, quantity, value, and terms of the goods being sold. It is essential for customs clearance and serves as a billing statement for the buyer.
Packing List- A packing list is a document that accompanies the shipment, listing the contents of each package or container in detail. It helps in identifying the contents, quantities, and weights of the cargo for customs and logistics purposes.
Special Certificates- Special certificates refer to additional documents or certifications required for specific types of goods or regulated commodities. These certificates may include phytosanitary certificates, hazardous materials declarations, or certificates of origin, depending on the nature of the cargo and the destination country’s requirements.
Entry Summary- An entry summary, also known as an entry, is a formal customs declaration submitted to the customs authorities upon the arrival of goods in a country. It includes details about the cargo, its value, origin, and other relevant information for customs clearance.
Proof of Delivery (POD)- Proof of Delivery is a document or record provided by the carrier to the shipper, indicating that the shipment has been successfully delivered to the recipient. It serves as evidence of the completed delivery and may include the recipient’s signature, date, and time of delivery.
Who Pays the Freight Forwarder?
The party responsible for paying the freight forwarder’s fees and charges can vary depending on the terms of the shipping agreement and the specific Incoterm (International Commercial Terms) agreed upon between the buyer and the seller. Incoterms define the responsibilities and costs associated with the transportation and delivery of goods in international trade.
Here are some common scenarios you may discuss with your freight forwarding company:
- Ex-Works (EXW) or FOB (Free on Board): In these Incoterms, the buyer is responsible for paying the freight forwarder’s fees. The seller’s responsibility ends once the goods are delivered to the carrier at the specified location (EXW) or when the goods are loaded onto the vessel at the port of departure (FOB).
- Cost and Freight (CFR) or Cost, Insurance, and Freight (CIF): In CFR and CIF terms, the seller is responsible for paying the freight forwarder’s charges to transport the goods to the named destination port. However, in CIF, the seller is also responsible for obtaining insurance for the goods during transit.
- Delivered at Place (DAP) or Delivered Duty Paid (DDP): In DAP and DDP terms, the seller is responsible for all transportation costs, including freight forwarder fees, and bears the risk until the goods are delivered to the specified destination (DAP) or the buyer’s premises (DDP).
Amazon FBA Freight Forwarders: Costs and Fees
The cost of your freight will vary on several factors, including the size and weight of the shipment, the origin and destination countries, the mode of transportation (air, ocean, and land), the value of the goods, and things like what category your products fall into as that will affect customs duties and taxes.
Always ask for quotes from several companies before choosing what makes the most sense for your company’s bottom line. Most other freight forwarding companies have a “Request a Quote” or “Contact Us” option located on their site.
Does Amazon Offer Freight Services?
According to Amazon, “We provide full truckload services using 53’ dry van equipment. Spot shipments are live-loaded at pickup and live-unloaded at your delivery destination. Additional services include straps. Our online tools allow all shippers to manage their loads on demand. We offer dedicated account managers and 24/7 customer support from our operations specialists.
Today, we do not support multi-stop shipments, intermodal, ocean, personal shipments, flatbed, LTL, small parcel, residential, drayage, or offer lift gates.
For shippers interested in contractual pricing, we can accommodate prepositioning trailers at pickup facilities and dropping trailers upon delivery (drop-and-hook services). For more information, please contact freight-sales.
Is It Necessary to Have a Freight Forwarder?
Whether you need an Amazon FBA freight forwarder depends on your business requirements. A freight forwarding service can offer expertise, cost savings, and simplified shipping for international trade. They can handle complex logistics and ensure compliance. However, for domestic shipments or established logistics setups, a freight forwarder may not be necessary. Assess your needs to decide if one is beneficial for your operations. Be cautious of using your manufacturer’s freight forwarders unless you have a long-standing relationship as there may be some built in undisclosed costs that can come back to bite you and you will end up paying more in the long run even if it looked cheaper upfront.
Benefits of Using a Freight Forwarder for Amazon FBA
Shippers can leverage Amazon’s supply chain capabilities and technology, in addition to 30,000+ Amazon-owned trailers and 30,000+ trusted carriers to meet your shipping needs. They offer the dependability, reliability, tracking, and high performance you deserve from your shipping partner. Amazon’s network runs 24/7, 365 days a year, and as a part of Earth’s most customer-centric company, they’ve built easy-to-use solutions to ensure visibility from quote to payment.
When Should You Use a Freight Forwarder?
You should consider using a freight forwarder in the following situations:
- International Trade: If you are involved in importing or exporting goods across international borders, a freight forwarder can help you navigate complex customs procedures, documentation, and transportation requirements.
- Complex Shipping Operations: When dealing with large or frequent shipments, especially involving multiple carriers and transportation modes, a freight forwarder can efficiently manage logistics and streamline the shipping process.
- Global Expansion: If you are expanding your business to new international markets, a freight forwarder can provide valuable insights into the shipping requirements and regulations of different countries, ensuring smooth cross-border operations.
- Customs Compliance: Freight forwarders have expertise in customs regulations, helping you ensure compliance with import and export laws, and avoiding delays and penalties.
- Cost Optimization: Freight forwarders can negotiate better shipping rates and choose cost-effective transportation options, potentially reducing your shipping expenses.
- Packaging and Labeling Support: If your products require specific packaging and labeling standards for certain marketplaces or carriers, a freight forwarder can ensure compliance to avoid shipment rejections or delays.
- Time Efficiency: Outsourcing shipping logistics to a freight forwarder allows you to focus on your core business activities, saving time and resources.
- Risk Management: Freight forwarders can provide insurance options for your shipments, offering protection against potential damages or losses during transit.
- Amazon FBA or E-commerce Selling: If you are an Amazon FBA seller or operate an e-commerce business, a freight forwarder can help with inbound shipping to fulfillment centers and manage the logistics of delivering products to customers.
- Specialized Knowledge: For industries with unique shipping requirements or handling sensitive goods (e.g., perishables, hazardous materials), a freight forwarder with expertise in these areas can ensure safe and compliant transportation.
What Is the Liability of a Freight Forwarder Agent?
The liability of a freight forwarder agent can vary based on the terms of the contract and the legal jurisdiction involved. Freight forwarders act as intermediaries and do not take ownership of the goods being transported. Instead, they facilitate the transportation process on behalf of their clients (shippers or consignors).
The liability of a freight forwarder agent can be categorized as follows:
- Limited Liability: Freight forwarders typically have limited liability for the actual physical loss or damage to the goods. They are not carriers and, in most cases, do not assume responsibility for the goods’ safe transportation. Instead, they may arrange cargo insurance on behalf of the client to provide coverage for loss or damage during transit.
- Errors and Omissions: Freight forwarders can be liable for errors and omissions in their documentation or for failing to follow specific instructions from their clients. This liability may include errors in customs paperwork, incorrect labeling, or inaccurate information provided to carriers.
- Contractual Liability: The liability of a freight forwarder is also governed by the terms and conditions of the contract or the freight forwarding agreement between the forwarder and the client. These contracts typically outline the extent of the forwarder’s responsibilities and any limitations on liability.
- Subcontractors’ Liability: Freight forwarders may engage third-party carriers, shipping lines, or other subcontractors to handle certain aspects of the transportation process. In such cases, the liability of the freight forwarder may be limited to the selection and supervision of these subcontractors.
It’s important for both the freight forwarder and the client (shipper or consignor) to clearly define the terms of their relationship and the extent of the freight forwarder’s liability in a written contract or agreement. This helps avoid misunderstandings and provides clarity on the responsibilities and risks associated with the transportation of goods.
Amazon’s Terms and Conditions for Freight Forwarding
Reference Amazon’s Freight Forwarding page for additional information regarding their personal terms of service when it comes to international shipping.
What Is the Best Incoterm for Amazon FBA?
The best Incoterm for Amazon FBA (Fulfillment by Amazon) depends on the specific arrangement and shipping preferences of the seller and the buyer. Generally, two common Incoterms are often used for shipping to Amazon FBA:
- Ex-Works (EXW): In an EXW agreement, the seller’s responsibility ends once the goods are made available at their premises (e.g., factory or warehouse). The buyer is responsible for arranging transportation from the seller’s location to Amazon’s fulfillment centers. This Incoterm allows the seller to have more control over the shipment until it is handed over to the carrier.
- Delivered Duty Paid (DDP): In a DDP agreement, the seller is responsible for delivering the goods to Amazon’s fulfillment centers, including handling all transportation, customs clearance, and import duties or taxes. The seller bears all the costs and risks until the goods are received by Amazon FBA.
How Do I Choose a Freight Forwarder?
When deciding on the best Incoterm for Amazon FBA, consider the following factors:
- Shipping expertise: If you have experience in international shipping and customs procedures, an EXW arrangement may be suitable. However, if you are unfamiliar with global logistics, a DDP agreement might be more appropriate as it transfers the shipping responsibilities to the seller.
- Cost considerations: DDP involves higher shipping costs for the seller as they are responsible for all transportation and customs fees. On the other hand, EXW may result in lower upfront costs for the seller, but the buyer assumes responsibility for arranging shipping, which could lead to higher expenses for the buyer.
- Risk management: DDP transfers more risks to the seller, as they are responsible for the goods until they are received by Amazon FBA. With EXW, the seller’s risk decreases once the goods are made available at their premises.
Ultimately, the choice of Incoterm will depend on the specific circumstances of the transaction, the shipping capabilities and preferences of the seller, and the agreement between the seller and the buyer. To ensure clarity and avoid misunderstandings, it’s crucial to define the chosen Incoterm clearly in the sales contract or purchase agreement. Additionally, sellers should consult with logistics experts or freight forwarders to assess the best shipping strategy for their Amazon FBA business.
What Is the Most Important Criteria in Selecting a Freight Forwarder?
The most important criteria in selecting a freight forwarder can vary depending on your specific shipping requirements and business needs. However, some key factors to consider when choosing a freight forwarder include:
- Experience and Expertise: Look for a freight forwarder with a proven track record and extensive experience in handling shipments similar to yours. Their expertise in logistics, customs regulations, and specific industries can greatly impact the efficiency and success of your shipping operations.
- Reliability and Reputation: Check the freight forwarder’s reputation in the industry, including customer reviews and references. A reliable and reputable forwarder is more likely to provide quality service and timely deliveries.
- Global Network: If you engage in international trade, choose a freight forwarder with a broad global network of partners and carriers. This ensures they can handle shipments to and from various countries with ease.
- Financial Stability: Ensure that the freight forwarder is financially stable and has the necessary resources to handle your shipments without any financial constraints or delays.
- Insurance Options: Inquire about the freight forwarder’s insurance options to protect your shipments against loss or damage during transit. Adequate cargo insurance coverage is essential for added protection.
- Customer Service: Assess the freight forwarder’s level of customer service and responsiveness. Clear communication and accessibility are crucial for smooth coordination and problem-solving during shipping.
- Technology and Tracking: Check if the freight forwarder offers advanced tracking systems and technology that allow you to monitor your shipments in real time and provide timely updates to your customers.
- Compliance and Regulations: Ensure that the freight forwarder is well-versed in import and export regulations, customs procedures, and compliance requirements. They should be capable of handling all necessary documentation accurately and efficiently.
- Cost and Transparency: Compare quotes from different freight forwarders, but also consider the value they provide beyond just the price. Look for a forwarder that offers transparent pricing and clear explanations of all associated costs.
- Specialized Services: If you have specific shipping requirements, such as handling hazardous materials or temperature-sensitive goods, ensure the freight forwarder has expertise in providing technical services.
Overall, the best freight forwarder for your business will be one that aligns with your shipping needs, offers reliable service, and demonstrates a commitment to ensuring the smooth and efficient transportation of your goods. Take the time to research and compare different freight forwarders to make an informed decision that supports your business goals.
What Information Does a Freight Forwarder Need?
A freight forwarder requires specific information from the shipper or consignor to efficiently and accurately handle the shipping process. Providing the following information to the freight forwarder is essential:
- Shipment Details: Details about the cargo, including the type of goods, dimensions, weight, quantity, and any special handling requirements.
- Origin and Destination: The pickup location (origin) and the delivery destination, including complete addresses, postal codes, and contact information.
- Incoterms: The agreed-upon Incoterm that defines the responsibilities and costs between the shipper and the buyer for the transportation of the goods.
- Shipping Schedule: The desired shipping date or timeline for pickup and delivery.
- Customs Information: Information related to customs requirements, such as the Harmonized System (HS) code, country of origin, and any specific customs documentation needed.
- Packaging and Labeling: Details about how the goods are packaged and labeled, including any special instructions or requirements.
- Shipping Documents: Providing the necessary documents, such as commercial invoices, packing lists, certificates of origin, inspection certificates, and export licenses, depending on the nature of the shipment.
- Contact Information: The contact details of the shipper or consignor and any other relevant parties involved in the shipment.
- Special Instructions: Any specific instructions or requirements for the shipment, such as temperature-controlled transportation, hazardous materials handling, or delivery restrictions.
- Insurance: If desired, the shipper may request cargo insurance coverage for added protection during transit.
How Do I Set up an Amazon Freight Forwarder?
As an Amazon seller delving into the world of international trade and navigating the complexities of the supply chain, you may wonder about the role Amazon plays in covering freight forwarding shipping costs for FBA. Amazon does not directly cover expenses incurred with your chosen Amazon freight forwarders, suppliers, or shipping companies if you branch outside of Amazon Freight.
By partnering with their logistics experts, sellers can access a wealth of benefits, including simplified international trade, cost optimization, and efficient customs clearance.
Create a shipper account in just a few minutes by clicking here. As soon as your account is created, you can begin booking shipments immediately.
If you’d like to learn everything you need to know about Amazon’s freight forwarding services for Amazon FBA sellers, check out Amazon FBA Freight Forwarder: Everything You Need to Know.
How Can I Ship to Amazon for Cheap?
Your supply chain demands will likely change with time. Though “cheap” is a relative term, there are a few ways to ease your cost to ship. Let’s walk through together this from the perspective of generating your shipment information inside of Seller Central.
When it’s time to ship your products in or finalize a final destination for your products, you will need to confirm what inventory you would like to send in first inside Seller Central. Classifications to provide will include carton dimensions, units per box, whether any labeling is required, how many boxes are being shipped in total, and the origin of the shipment. The origin is primarily used to determine which Amazon warehouse you will be shipping your products into and the products do not necessarily need to originate from there.
Amazon has prep and labeling fees. Meaning if you wish to save some money, it is in your best interest to apply any labels or shipping marks to your pallet or cartons before they reach your destination country. Labels can typically be applied for free by your manufacturers but will come at a cost of 30 cents to you if you wait to let Amazon apply your FNSKU – your unique identifier for your product.
Once inventory and shipping information are confirmed, you can verify pallet and carrier estimates (one of two options typically) before finalizing. You will need to provide a shipment date and a freight date. We recommend timing this with your own freight forwarder and customs broker to save you the headache of having your shipment stuck in queue costing you valuable time and money. Even if the time for the shipments delivered to the final destination varies for some reason after your international shipment has entered the country, you will want to ensure rescheduling on Seller Central.
Of course, you should also always negotiate with multiple couriers and freight forwarding companies before choosing a good freight forwarder for you. To ship to Amazon with low shipping goods, leveraging freight forwarding services can be instrumental, and the broader your scope is, the better the odds of you landing a decent quotation.
These specialized services will allow you to consolidate shipments, offering more economical rates and smoother deliveries, thereby reducing shipping costs. Additionally, working with reliable shipping services and transportation providers will ensure efficient ground shipping options, optimizing the overall logistics process.
By understanding your inventory size and value, you can also strategically opt for full container loads or less than a container load and port-to-port shipping methods to capitalize on economies of scale in sea freight, contributing to more affordable transportation costs. You will have the option of floor-loading cargo or shipping by pallets. Ocean shipping service is generally more cost-effective than air cargo which is faster, but more expensive.
Some other small pointers are investing in nice packaging is sometimes worth it because you can increase your average selling price and cushion your profit margins, but use free packing materials when possible so long as they are durable for your transport process.
At the end of the day, you will undergo some trial and error before finding the best fit. But by combining freight forwarding services with people who are king when it comes to Amazon FBA expertise and professional customs support, you can streamline your shipping process to Amazon, ultimately reducing expenses and enhancing your profitability as an Amazon seller. Good luck!
Frequently Asked Questions
No, but understanding the intricacies of import haulage and customs clearance can lead to significant cost-saving opportunities.
When using Amazon FBA, you have the responsibility of arranging and covering the shipping costs from your supplier or freight forwarder’s location to the designated Amazon fulfillment centers. While this initial investment might seem daunting, strategic planning and partnership with reputable customs brokers can facilitate smoother customs processes, minimizing potential delays and associated expenses.
It is essential to factor these shipping costs into your overall pricing strategy, ensuring you maintain a competitive edge while offering customers a seamless shopping experience. By staying informed and proactive in managing your supply chain and shipping expenses, you can thrive as an Amazon seller and effectively expand your reach into international markets.
Kuehne + Nagel International AG (Kuehne + Nagel) is a provider and the company offers logistics solutions such as sea freight, air freight, road contract logistics, and integrated logistics.