Freight Forwarding Service 101: Process, Costs, and Documents

If you are moving goods internationally for the first time (or scaling up beyond a few shipments), a freight forwarding service can feel like a black box: who does what, why quotes vary, and which documents actually matter.

This guide breaks freight forwarding into three practical parts: process, costs, and documents. The goal is to help you speak the language of logistics, avoid expensive surprises, and build a repeatable shipping workflow.

What a freight forwarding service actually does

A freight forwarder is a logistics partner that plans, books, and manages cargo movement across borders and modes (air, ocean, rail, and ground). Forwarders coordinate multiple parties to move a shipment from origin to destination while keeping it compliant and on schedule.

A forwarder is not the same as a carrier.

• Carrier: physically transports cargo (airline, ocean line, trucking company, railroad).

• Freight forwarder: arranges transportation, documents the shipment, coordinates handoffs, manages exceptions, and often provides optional services like cargo insurance and warehousing.

Depending on your shipment and destination, a forwarder may also act as (or work closely with) a customs broker for import or export clearance. In the US, customs brokerage is regulated, and entries are filed with US Customs and Border Protection (CBP).

The freight forwarding process (step by step)

Most shipments follow the same end-to-end flow, even if the details vary by mode and country.

1) Define the shipment and the commercial terms

Before anyone can quote accurately, you need a clear shipment profile:

• Commodity description (plain language plus HS code if available)

• Dimensions, weight, and number of pieces

• Packaging type (cartons, pallets, crates)

• Origin and destination addresses (and whether either location needs liftgate, appointment, inside delivery, etc.)

• Target dates and required transit time

• Any special handling (temperature control, oversize, hazardous materials)

You also need to confirm Incoterms, which define who is responsible for transportation, insurance, and customs tasks at each point. The ICC maintains the official Incoterms framework, see the ICC Incoterms overview.

2) Receive a quote and choose a routing

A forwarder typically provides routing options (for example, cheaper ocean vs faster air), along with:

• Expected transit time range

• Pricing structure and validity (quotes often have short validity during volatile markets)

• Assumptions and exclusions (customs exams, storage, demurrage, duties/taxes)

3) Booking, shipping instructions, and pickup

Once you approve a routing:

• The forwarder books space with the carrier

• You provide shipping instructions (often via an SLI, shipper’s letter of instruction)

• The forwarder coordinates pickup, drayage, and delivery into the port or airport

At this stage, accuracy matters. Incorrect weights, dimensions, or piece counts can trigger re-rating and delays.

4) Export compliance and origin handling

Export steps depend on the origin country and commodity.

In the US, certain exports require an Electronic Export Information (EEI) filing through AES, commonly based on value thresholds or license requirements. Official guidance lives with the US Census Bureau AES resources.

Origin handling often includes:

• Cargo receiving and security screening (especially for air)

• Palletizing or crating if needed

• Documentation review before tendering to the carrier

5) Main carriage (air, ocean, rail)

This is the long-haul portion:

• Air freight: fastest, higher cost, pricing driven by chargeable weight and capacity.

• Ocean freight: cost-effective for large volumes, longer transit, more port events.

• Rail (often paired with truck): common for inland moves and intermodal routes.

6) Import clearance and destination handling

The importer (or their broker) clears the shipment with the destination customs authority, paying duties and taxes where applicable.

For US ocean imports, Importer Security Filing (ISF) is a key compliance milestone. CBP provides ISF guidance here: Importer Security Filing (ISF).

After clearance, destination handling may include terminal fees, container pickup, deconsolidation (for LCL), and local delivery.

7) Final delivery and proof of delivery

The forwarder coordinates last-mile delivery to the consignee, including appointments, accessorial services, and proof of delivery.

Freight forwarding costs: what you are really paying for

Freight is not one price, it is a stack of charges from multiple parties. Understanding the categories helps you compare quotes “apples to apples.”

The main cost drivers

Forwarding costs typically change based on:

• Mode (air vs ocean vs rail)

• Shipment density (how much space you consume relative to weight)

• Lane and seasonality (capacity and congestion)

• Service level (port-to-port vs door-to-door)

• Cargo type (hazmat, oversize, temperature-controlled)

• Risk and compliance requirements (exams, special permits)

Common charge categories (with plain-English definitions)

The exact names vary by forwarder and country, but these buckets show up often.

Cost category	What it covers	Where it usually occurs
Main freight charge	The long-haul transport bought from the carrier	Air, ocean, rail
Origin charges	Pickup coordination, receiving, terminal/warehouse handling	Origin country
Destination charges	Terminal handling, deconsolidation, release, local processing	Destination country
Customs brokerage fees	Filing entries, classifying goods, coordinating with customs	Destination (and sometimes origin)
Duties and taxes	Government charges based on classification and value	Destination customs
Accessorials	Liftgate, appointments, residential delivery, detention, redelivery	Origin or destination
Storage and port time risk	Demurrage, detention, warehouse storage if deadlines are missed	Mostly at ports/terminals

A practical takeaway: the cheapest freight line item can still produce an expensive shipment if destination charges, exams, or port delays are not planned for.

How air and ocean pricing differs (and why quotes vary)

Forwarders price shipments based on how carriers sell capacity.

Air freight is commonly billed on chargeable weight, which compares gross weight to dimensional weight. If your cartons are large but light (low density), you pay for space rather than scale weight. This is why improving packaging density can reduce cost without changing product weight.

Ocean freight often splits into:

• FCL (Full Container Load): you pay for a container (20-foot, 40-foot, etc.). Best when volume is high and you want fewer touches.

• LCL (Less than Container Load): you pay for your share of a consolidated container, usually based on volume (CBM) and minimums. Best for smaller shipments, but it adds consolidation and deconsolidation steps.

When comparing two ocean quotes, make sure both include (or both exclude) the same destination items, especially terminal handling and deconsolidation for LCL.

Freight forwarding documents: what you need and why

Documents are the “operating system” of international shipping. They drive customs clearance, payment terms, cargo release, and claims.

The essential document set for most shipments

These are common across modes and destinations.

Document	Purpose	Usually prepared by
Commercial invoice	Declares seller, buyer, value, currency, and item details for customs	Seller/exporter
Packing list	Shows how goods are packed (pieces, weights, dimensions)	Seller/exporter
Shipper’s Letter of Instruction (SLI)	Tells the forwarder how to route, declare, and document the shipment	Shipper/exporter
Certificate of origin (if required)	Supports origin claims and sometimes duty treatment	Exporter or chamber/issuer
Export filing data (when required)	Satisfies export reporting rules (varies by country)	Shipper or forwarder (as authorized)
Import entry data	Enables customs clearance and duty calculation	Importer/broker
Cargo insurance certificate (if purchased)	Evidence of coverage for transit risk	Insurer/forwarder

Transport documents (proof of carriage and title control)

The key transport document depends on mode.

• Bill of Lading (B/L) for ocean: the central document for ocean shipping, used for cargo receipt and release mechanics.

• Air Waybill (AWB) for air: governs air carriage and tracks the shipment.

• Rail waybill or intermodal documentation for rail moves.

Which one you need is not just a paperwork detail. It affects how cargo is released, who can pick it up, and how disputes are handled.

Compliance documents (when applicable)

Some shipments require additional documentation depending on product, destination, or handling.

• Hazardous materials paperwork (shipper’s declaration, markings/labels) for regulated dangerous goods. For air shipments, rules align with IATA’s Dangerous Goods framework (commonly managed by certified shippers and forwarders). For ocean, dangerous goods follow IMO’s IMDG Code.

• Permits, licenses, or special certificates (for example, controlled goods, food, medical devices, wood packaging requirements).

• Importer Security Filing (ISF) for US ocean imports, filed before loading, see CBP ISF guidance.

A quick checklist to avoid delays and surprise fees

Most first-time cost overruns come from preventable gaps: missing data, unclear responsibilities, and timing misalignment.

Get these right before you book

• Confirm Incoterms and who is acting as importer of record.

• Validate piece count, weights, and dimensions (carrier audits are common).

• Ensure your commercial invoice matches the purchase order and payment terms.

• Plan for port and terminal deadlines to reduce demurrage and detention risk.

Reduce cost without cutting corners

• Improve packaging density to reduce chargeable weight (air) and CBM (LCL).

• Consolidate smaller shipments when timing allows.

• Choose the right service level (door-to-door vs port-to-port) based on your team’s capability.

• Share complete commodity details early so classification and compliance can be validated before cargo moves.

How to choose the right freight forwarder for your shipment

A freight forwarding service is a long-term operations partner, not just a one-time rate.

Look for:

• Mode coverage that matches your reality (air, ocean, rail, trucking, plus customs support where needed)

• Proven handling for your cargo type (high value, time-critical, oversize/project cargo)

• A global partner network for consistent handoffs across borders

• Clear communication and exception management (what happens when a vessel rolls, a flight cancels, or customs holds cargo)

• Options to protect risk, such as cargo insurance, plus guidance on practical coverage decisions

Where SHIPIT Logistics fits

SHIPIT Logistics is a global freight forwarding and logistics provider offering international freight forwarding, air and ocean freight services, customs brokerage, warehousing and fulfillment, trucking, and project/heavy lift cargo support. Operating since 1974, SHIPIT serves shippers, forwarders, and brokers with an emphasis on customer service and operational execution.

If you want a quote or want help confirming the right routing, costs, and document set for your shipment, you can start with SHIPIT at SHIPIT Logistics.