Private Label Process 4: How to Freight Forward

So you’ve found/developed your product, nailed down a supplier and negotiated a production order of a few hundred units.  You’ve arranged FOB terms, paid 30% and now you’re waiting 30 days for them to finish. Now what? Now you should find a freight forwarder to help you send you shipment to your destination. Here’s the process.

  1. With your supplier’s port and your destination address, get a DDP (all-inclusive price to your door) quote from at least 5 freight forwarders and compare prices.
  2. Sea shipping rates to USA should be about $1.5-2/kg for sea shipping, with a minimum weight of 100kg. It should take around 30 days.
  3. Chargeable weight is based on gross weight or volumetric weight, whichever is greater. Volumetric weight is calculated by l(cm)*w*h* # of cartons/6000.
  4. So if you have 10 cartons of 45x45x45cm that weigh 15kg each, your gross weight will be 15*10=150kg, and your volumetric weight will be 45*45*45*10/6000= 152kg. They will charge you at 152kg with a rate of about $1.5/kg= $228.
  5. Note: If your supplier overloads the carton or uses a poor quality cardboard, your carton dimensions will grow slightly by the time it arrives at port which will cause a discrepancy when your freight forwarder checks the dimensions. Avoid this by asking your supplier to use high quality cartons meant for exporting, securing the package with tape, and not to overload the cartons.
  6. Double note: Freight forwarders are notorious for inflating the dimensions no matter what, so make sure you are vigilant in knowing what your carton dimensions are. An added 1cm per dimension added on by the freight forwarder could be reasonable, but make sure they are not tacking on 3-5cm per dimension, which would increase your costs by upwards of 20-30%.
  7. In the end, by the time your shipment arrives at the port, you basically have to pay what the forwarder wants, but if you feel like you are being cheated, just switch forwarders next time. There are hundreds to choose from and what’s most important is trust. You are looking for someone to take care of potentially tens of thousands of kilograms of product over the years, so you want first and foremost to find one who you can develop a long-term relationship with.