In modern shipping, three terms pop up regularly, freight broker, freight forwarder, and customs broker. While they may seem similar, distinct differences are associated with each term. Understanding the differences and benefits of each can be helpful when planning on moving freight.

What is a Freight Broker

A freight broker’s job is to coordinate with a carrier to transfer freight. Shippers contact freight brokers when they want their goods moved somewhere inside their country. The freight broker then finds a third-party carrier to move the shippers’ freight. The carrier can be from a network of carriers that the freight broker is connected to. Freight brokers also transport goods using their clients’ bill of lading. If you are looking for a freight broker, contact us at 305-821-8995 to start your freight transportation journey.

What Is a Freight Forwarder?

A freight forwarder’s main job is also coordinating the freight transfer. However, the transfer tends to involve international transport and can include various conveyance methods. This can range from planes, boats, trucks, or even a combination of each. Unlike freight brokers, freight forwarders can take possession of the client’s freight. Forwarders may store their client’s cargo in a warehouse for a specific time. Since they ship the freight under their authority, forwarders ship using their bill of lading. To learn more about freight forwarding services, click here.

What Is a Customs Broker?

When goods enter a country’s international borders, they have to go through a customs clearance process. This process is implemented so illegal, and potentially dangerous materials do not enter the country. Each country may have different regulations for what can enter, and customs brokers make sure that those rules are followed. Once the freight arrives at a country’s port of entry, the customs broker submits the documentation to release the cargo. The customs brokers can be licensed individuals, corporations, and even partnerships. Although shippers can import goods into a country by themselves, they usually use customs brokers due to the complexity.

What’s the Difference?

Although they all act as intermediaries, they differ in who and how they intermediate. Freight forwarders and freight brokers are intermediaries between a company or person planning to ship and a transportation company. Customs brokers are intermediaries between a shipper and a country’s customs department. In the United States, it’s the U.S. Customs and Border Protection. Also, while customs brokers only deal with imports, freight forwarders can deal with imports and exports. Compared to freight brokers, freight forwarder is a broader term. Freight forwarders usually offer a wider variety of services than freight brokers.

Customs brokers deal with the part of the shipping journey when freight enters a country. Forwarders, however, may be present throughout the whole shipping journey. The journey could start before containers are loaded onto the sea vessel. And end when the carrier transfers the freight to its final destination. Freight forwarders and freight brokers may be customs brokers. Logistics companies provide customs clearance, freight brokerage, freight forwarding, and other services. While freight brokers, freight forwarders, and customs brokers differ in services, they all are essential parts of the shipping industry.

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