International Freight Quote: How to analyze it?

When we request an international freight quote, no matter the mode of transport, we tend to only look at the cargo value and end up not observing the rest of the information contained in the quote; should we just look at the freight value, though? Isn’t there any other important information to be observed? Well then, let us understand a little more about how to analyze the quotes and their structure. After this, importers and exporters will certainly clarify many questions on the subject.

An International Freight Quote: Why do it?

The importance of having a good freight quote seems fundamental, since a wrong quotation can cause problems related to the delivery schedule – Can you imagine the mess if the exporter has already signed a contract with the importer on this matter? – plus, a wrong quotation can also burden the process costs, given the fact that the logistics price has a great weight on the products’ final value.

The international freight cost can vary a lot, depending on the freight forwarders involved, the type of cargo to be transported, the countries where the process will take place in, the port of origin and destination, and even depending on the means of transport to be chosen. Thus, to really know laws and rules governing international freight, it’s essential to ensure that the products reach their destination safely, on time and with a fair transport cost. Once the freight service is complete, you need to check the tracking information to make sure the goods can arrive at the right place, within the deadline.

When hiring an international freight service, to carefully review the terms of service and check the delivery guarantees is totally relevant. It is also vital to make sure that the company you hire has a good track record and, moreover, is known for offering a quality service. Finally, make sure that all the documents required for shipping the goods are properly filled out before the delivery.

International freight quotation: How to do it?

A good understanding of the details of the process is always fundamental, such as knowing what documentation is required, deadlines, rates, and fees. It is also necessary to check whether the goods are suitable to be exported or imported, if there is any export or import restrictions, and whether they are in accordance with international regulations.

Hence, here you have the prominent information that must be sent for the freight forwarder to structure a quotation:

Know the traded Incoterm – It is certainly a substantial information to have! Without it, the agent will not be able to make the quotation;
Depending on the established Incoterm, it is necessary to inform specific addresses for both the cargo’s withdrawal as well as for its delivery.
Check the merchandise / determine the NCM (MERCOSUR Common Nomenclature) – once it’s done, the agent will know which type of freight he/she should consider and what kinds of documents are required;
Check the commodity’s value – having its price, in addition to the freight quote’s calculation, the agent will be able to assist on the best way to ship the merchandise and negotiate the insurance values;
Know the cargo’s origin and destination – this is always essential information;
Determine the shipping form – whether it’s an ocean, road, or air transportation;
Check the negotiation between delivery times – it becomes relevant for the best transit time search;
Check the cargo size – its length, width, height, cubage, gross weight, the type of packaging and so on;

Let us give a suggestion for professionals in the area: setting up a standard e-mail with all required information and having it saved is a good idea to make sure you send all the information at once, if you wish to avoid so many e-mail exchanges or calls only because something was missing.

International freight rates: How to analyze them?

Beware of very low freight prices, it may be a trap!

Once the freight forwarder has calculated the quote, he/she will send a complete quote with all the details included, then, importers or exporters should compare these values and study them carefully to avoid pitfalls.

For instance:

– Low freight value – might mean higher transit time;

– Low freight value – demurrage with high values;

– Low freight rates – very few days of free time to return the container;

– Low freight value – higher port or deconsolidation fees.

So, look for quality information such as average delivery time, returning rates, and kinds of provider’s support. If possible, ask for a sample of services before your hiring. It’s is also relevant to check whether the provider does good business and offers good quality guarantees.

Here are some of the fees and their acronyms to be observed and compared during quotations:

POL – Port of embarkation;
POD – Port of disembarkation of the cargo;
TT – Time of transit;
Rate OFR – Ocean Freight Rate;
Transhipment charges;
Docs – Documentation fee;
Storage at CFS – Storage fee;
BL fee – Fee to release the BL to the shipper;
Deconsolidation – Deconsolidation fee;
ISPS – Fee used for vessel and port facility security;
ODF – Documentation Fee at origin;
OHC – Terminal handling fee;
Wharfage – Other fees calculated at the port.

As you can see, all of them must be analyzed before closing an international freight deal!

International freight quotation: What precautions should importers or exporters take when hiring it?

Quality and Safety

It is important that the carrier offers a quality and safety service. Check if the company has insurance and security both for the transported products as well as for the driver.

Speed

Verify if the transporter can offer a fast, safe and efficient service.

Price

Check if the offered price is affordable and if it has a good quality service.

Flexibility

Check whether the carrier provides flexible and customized services to meet the customer’s specific needs.

Experience

It is good to verify if the transporter has experience in the area and has a good track record.

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