Outsourcing freight operations to international freight companies enables businesses to grow faster by focusing on their core competencies along with many other benefits. However, sometimes unfounded myths and perceptions cause unnecessary confusion for Australian business owners and new importers/exporters which may deter them from using the services of international freight companies.
These myths are commonly related to service levels, costs, controls, transparency and data security. International freight companies are likely aware of these myths and it is ideal to clarify these with their customers from the very beginning. Smart businesses also tend to clarify any misleading facts and clear any misconceptions they may have about freight forwarding services.
Read on to learn the most common myths and misconceptions about international freight companies and learn the truth.
1) Service quality is directly proportional to the size of the business volumes
The biggest myth is that international freight companies are likely to give better service to large sized customers and may not care for customers with smaller volumes. The fact remains that international freight companies need all the volumes that they can get from big or small customers so they can utilise their maximum capacities and achieve profitable efficiencies with their operations. Whether the customer is big or small, expert international freight companies are likely to treat every customer as equal and provide the same level of service to retain them.
2) It is costlier to engage international freight companies than source my freight directly from the carrier
There is a common myth that international freight companies may add large margins on top of a carrier price which will make it costlier for you. Whereas the reality is that international freight companies leverage the volumes achieved from their broad customer bases to negotiate better rates. This advantage allows the carriers to offer better rates to freight forwarders which in turn assists them to reduce their costs. Many freight forwarders work with their customers with an open book policy meaning they charge a handling or agency fee per shipment or transaction and do not mark up the freight costs. Ask your potential freight forwarder about the options they provide to their customers.
3) Less control over your cargo compared to in-house management
Directly working with carriers means that you would have to engage with each of them to maintain control over your goods in supply chain.
This creates many contact points for you. Many of these carriers are not service oriented and are not likely to entertain your regular requests for information. International freight companies are likely to have extensive relationships with the carriers and have their own personnel positioned at important nodes to get direct information and control over your goods. This will ensure you gain all your information from one source and get much needed control over your supply chain.
4) International freight companies are not transparent
This myth more than likely was created from historical industry conditions where freight forwarders were unable to gain a standard level of information to maintain transparency with customers. In today’s economic climate, international freight companies are able to readily access and provide information as well as leverage long standing global networks to build transparency in their freight forwarding operations and services.
5) High risk of data leakage
In our current competitive market, data security remains a large concern for customers. Data could be related to your selling or buying price and/or the seller's and buyer’s information or volumes. International freight companies understand this concern very well and are likely to bind their employees with contractual obligations, use technology to detect any data leakage from official systems and adhere to data confidentiality as a part of their contractual obligation with customers.
It is important to build and retain a customer relationship that is based on trust which is likely to be gained when an international freight company clears any myths and perceptions that you may have about outsourcing your freight forwarding operation. Industry providers are cognisant of freight forwarding myths and ensure that they remain professional and customer-centric in order to build a long relationship with the customer.