“What is to be done?” – anyone who has come across the problem of freight forwarding must have asked himself this perennial question first posed by Nikolai Chernyshevsky. Let us see what exactly “freight forwarding” is and what its essence is.

The Oxford Advanced Learner’s Dictionary defines “forwarding” as “sending or passing goods or information to somebody”.

HISTORICAL NOTE. The history of freight forwarding goes back into the distant past. The first freight forwarding began with the invention of the wheel. The first wheels that we know of were invented in Mesopotamia (modern Iraq) in the fourth millennium BC. Early Middle Ages (late 5th – middle of the 11th century) saw the emergence of horse-drawn baggage trains, considered to be the direct ancestors of modern trains, as well as of merchant river and sea fleets.

Freight forwarding can be performed using four different means of transportation – by rail, by sea, by road, by air – or their combinations.

HISTORICAL NOTE. The first Russian railway was created in 1834 at the Vyiskij Plant in Nizhny Tagil. It – as well as the first Russian steam locomotive – was created by Yefim Cherepanov and his son Miron Cherepanov, talented Ural craftsmen and engineers.
Evgeniy Yakovlev and Peter Freze are considered to be the inventors of the first Russian automobile. It was ready in May of 1896 and on July 1 of that year it was presented at the All-Russia Art and Industry Exhibition in the city of Nizhny Novgorod.
The German engineer Gottlieb Daimler is considered to be the inventor of the first truck. He created it in 1896.

The first truck, 1896, Gottlieb Daimler

Freight forwarding can be divided into the following categories: intra-city, inter-city, and international. International freight forwarding often involves multiple means of transportation – it is the so-called “multimodal” or “intermodal” freight forwarding.

Freight forwarding rates are always made up of several components that depend on the type of freight forwarding.

Intra-city freight forwarding rates depend on the time required for transportation and are calculated per transportation unit. One should take into account that specialized transport is required for the transportation of glass, liquid, bulk, and oversized cargo. According to current legislation, cargo is considered oversized if its width exceeds 2.5 m, its height (from the road surface) exceeds 4 m, and its length exceeds that of the transportation vehicle by more than 2 m. One should also take into account the fact that in metropolises like Moscow, St. Petersburg, Ekaterinburg, Novosibirsk load-carrying vehicles can enter the downtown area either only in the evening and at night or with special permits. Intra-city freight forwarding is achieved using motor vehicles.

Inter-city freight forwarding rates depend on the distance between the loading point and the destination point and on the cargo’s weight and volume. One should also take into account factors such as: insurance expenses, cargo security expenses, whether the distance is calculated from the loading point to the destination point (one-way) or from the loading point to the destination point and back (return, which costs twice as much as one-way). Due to our country’s geographic location and its large area, inter-city freight forwarding is achieved using road and railway, as well as air and sea (river) transportation. This leads to the emergence of multimodal freight forwarding. Inter-city freight forwarding in European countries is achieved using mostly road transportation; inter-city freight forwarding in China and Southeast Asian countries – using road and rail transportation.

International freight forwarding rates are influenced by many factors and depend on the service package that a client needs. The main components are transportation logistics, warehouse logistics, customs duties, approvals and permits required for importing the cargo into Russia, cargo insurance. International freight forwarding is achieved using all means of transportation; cargo can be transloaded from, say, a truck to a railway wagon – or it can be transported from the point of loading to the destination point without transloading, in a sealed load-carrying vehicle or container. Multimodal freight forwarding is most often used for transporting groupage cargo.

Groupage, or consolidated, freight is the aggregate of cargoes from two or more different consignors, shipped by the same transportation vehicle, along the same route, addressed to different consignees. A feature of groupage freight forwarding is that rates are calculated based on the cargo’s dimension, not per transportation unit. Groupage freight forwarding can be very convenient in case one client’s cargo is less than the capacity of a transportation vehicle.

Any freight forwarding company that specializes in the type of transportation that you need can help you select the means of transportation, calculate all the expenses that you are going to incur, and prepare the required paperwork. But only a large freight forwarding company can offer groupage freight forwarding, create complex transportation and logistics solutions, find the best solution for any client. The larger a freight forwarding company, the more groupage freight it has, the more often it consolidates it – thus increasing the freight traffic volume, which, in turn, allows it to ship groupage freight from different parts of the world on a regular basis and to decrease the own cost of groupage freight forwarding. That is why only a large freight forwarding company can be trusted with groupage freight forwarding.

2010-04-06

Author: Mrs. Elena Kolycheva