Importing products from overseas, going directly to the product source to cut out middlemen markups, is one of the most lucrative business models around. Be that as it may, importing is a complex process.
First, you’ve got to find or create the product, then vet suppliers, then negotiate the terms, then stay on top of quality control, then coordinate logistics, then customs, then inbound shipping. All of those steps take place before you can even think about getting your product in a store or on an online marketplace where you then have to figure out how to market it.
What makes importing uniquely challenging is that it is not one of those things you can just DIY. Sure, you can learn how to fill out and submit customs paperwork on your own, but you have to rely on third party services for quite a lot. I mean, it isn’t like you are going buy a barge and pick up your freight on your own.
When shipping large quantities, the most affordable and efficient method of transport is by sea. Inevitably you’ll find yourself employing the invaluable services of a freight forwarder to help you with this process. While the freight forwarder plays a crucial role in your supply chain, they should be vetted like any other service you engage with. This is a guide to help you find the right forwarder partner for your business.
When shopping for anything, we as consumers tend to compare. We compare features, compare prices, compare customer service, and so on. Purchasing business services is no different a process. However, when it comes to finding the right freight forwarder, it is important to be prepared first.
The very first step you should take is to get the necessary information from your supplier. You need carton dimensions and weights as well as the port your goods will sail from. It is also probably a good idea to know ahead of time how many cartons/units will fill up a 20ft or 40ft container. That way you know the size of the container you’ll need for your order.
- Master carton Length x Height x Width
- Master carton Weight
- Number of cartons
- Number of units per carton
- How much space your order will take up and in what sized container
- Port from which the goods will be picked up and shipped
With this information you can get accurate quotes on the shipping. As an added bonus you may also look up the tariff code for the commodity type so if your forwarder also provides customs clearance (they should) you’ll be able to provide them with the HS code as well.
Evaluate Your Needs
A quick Google search will reveal hundreds of pages worth of freight forwarder information. Far too many to sift through individually. For this reason, it is a good idea to first understand what it is you need. Every business’ needs are different and your process may determine who best to approach.
For example, if you already have a customs broker, you may not need to find a freight forwarder who offers to coordinate customs clearance as well. However, if you don’t already have one, this would likely be an important feature.
Maybe you only plan to order container loads and aren’t worried about a forwarder who can offer air shipping at decent rates. Or, perhaps you like to send the bulk of each shipment by sea, but allocate some to air express shipping so you can get to market quicker. In this case, you’d want a forwarder with plenty of logistics capabilities in the ocean or the sky.
If you plan to ship mostly LTL, then you may want a forwarder who can offer warehouse services, such as palletization, to avoid having to contract a prep center.
Once you have identified your logistics plan, this allows you to narrow your search. If you plan to use a staging warehouse on a specific coast, for example, then you’ll search for freight forwarders located in that area. If you need warehouse distribution, then you’ll search forwarders that offer distribution services as well. And so on.
Pay Attention to Service
After you have narrowed your search, you should identify potential candidates. You can do this through Google, or reaching out to your network or forums and Facebook groups. Make a list of prospects and contact them either by phone or email asking if they offer the services you are in need of.
At this point you are looking to see who contacts you back. You aren’t obligated to do business with the first person to get in touch with you by any means. It is a good idea, though, to see how responsive your candidates are. Those who respond quickly and who take the time to answer each of your questions are clearly interested in gaining your business. Those who don’t respond for days (or at all) and whose responses are clearly copy and paste templates that don’t address your specific concerns may not be the best fit.
A service provider’s professionalism and communication skills are big parts of choosing who to partner with. This is because your logistics partner will become an integral aspect of your overall business. And partners should always be carefully chosen.
Break Down the Numbers
When you’ve opened up a dialogue with capable freight forwarders, the next logical step is to actually compare quotes and service options. Give them your specs and look at your offers. Do they provide the services you need? Are those services offered within your budget?
You obviously won’t be looking for the cheapest option, but instead the most affordable value that provides everything you need. Don’t be afraid to get several quotes either. The more you have to compare, the more options your business will have.
An Added Bonus
The added benefit to getting lots of quotes from many freight forwarders is you will learn SO MUCH about logistics. A good freight forwarder will be interested in discussing your needs with you, and in these conversations you will glean lots of education on the lingo and jargon, the process and opportunities for efficiency. You’ll walk away from the experience with solid knowledge on the best incoterms that will work for your business, or the best trade routes to have your shipments take.
You’ll learn the most common ports for goods that come from your factory’s port, as well as what goods or areas are most prone to customs inspections. The insider knowledge that this process teaches you is priceless for a budding importer.
I have personally been importing goods since 2014 and have almost exclusively used BGI Worldwide Logistics.
However, I have colleagues that import much more than I do and they SWEAR by Flexport.
Lastly, for those of you who sell your goods on Amazon.com and wish to make your logistics process more efficient by sending goods directly from overseas to FBA, Topway Freight is a China-to-FBA freight forwarder. However, if you choose to go this route, I recommend reading this article on how to properly optimize your supply chain logistics.
Supply partners are essential to any import business. In the end, just remember it is YOUR business, so you should not be rushed into a decision. Take your time and evaluate your options and you are sure to find a logistics partner that works well for you.