If you’re coming from the world of LTL freight, securing an ocean freight quote might feel a little different to you. One big change you might notice is that your freight forwarder will likely have a bunch of questions for you. They also probably issue a detailed quote with a lot of line items.
You might be used to a different process. But, in our opinion, the extra detail is a good thing.
Here’s why: By asking a number of questions upfront and breaking out your quote in itemized detail, your forwarder is trying to give you the most accurate estimate possible, so there are no surprises when you receive the final invoice.
- You’ll understand exactly what you’re paying for, every step of the way.
- You’ll also be better informed about your ocean freight costs so you can plan for them and optimize that link of your supply chain.
In this article, we’ll walk you through some of the major areas involved in your ocean freight quote so you can better understand the questions your forwarder is asking. Plus, by getting a closer handle on the process, you’ll have the know-how you need to compare quotes between forwarders. (This is especially handy if you’re new to the world of ocean freight!)
Understanding the Details Behind Your Ocean Freight Quote
So why are ocean freight quotes so detailed? First of all, there are lots of factors that go into your final price. (More on that next!) But maybe, more importantly, many freight forwarders use a detailed quoting process to ensure that you’re getting the exact services that you want, from start to finish.
Ultimately, all this detail will be to your advantage: No one—and that includes your forwarder—wants your final invoice to come as a surprise!
To help you understand the factors involved, we’ll walk you through the areas your freight forwarder will likely ask about (and include on your invoice)!
#1: What Type of Shipment Do You Want: FCL or LCL?
When you ask for an ocean freight quote, your forwarder will want to know whether you’re looking to move:
- A full container (FCL) or
- Less-than-container load (LCL), which will be consolidated with several other shipments into a single container.
Although the size of your shipment may dictate your decision, there are shippers who want their own dedicated container, even for smaller loads. For example, a shipper may have something like finished furniture that they don’t want to be rehandled in a consolidated load. Or perhaps they simply prefer to load the container themselves. If that’s the case, let your freight forwarder know so they can factor that into your quote.
If you’re shipping an LCL load, the next thing your forwarder will likely want to know is:
#2: What’s the Size and Weight of Your Shipment?
When it comes to less-than-container loads, your forwarder will ask for two measurements of your freight:
- The dimensions of your load in inches.
- The weight of your shipment in pounds.
Why do they need both? Ultimately, your ocean freight shipment will be priced on volume, as measured in cubic feet. However, weight can also be a factor, especially if your consolidator is, for example, looking for a light load to balance out a heavy shipment in the same container.
Your forwarder will also ask about two other pieces:
Is your shipment stackable? Often, a forwarder can double-stack loads in a container. For example, imagine two pallets of boxes that go one on top of the other. However, if your load is tall or it doesn’t have a flat surface to stack on (such as a piece of machinery), your forwarder can’t load anything on top. Therefore, they might have to charge you for that extra space on top of your load—i.e., the entire height of the container. That’s why they’ll want to know how stackable your shipment will be.
Is your shipment palletized? If the answer is no, your options might be a bit more limited. Maybe you have a load of loose boxes to ship. If they’re on a pallet, the whole load is more likely to stay together during its journey, and it’s easier to handle during loading and unloading. Bottom line: If you load your shipment on a pallet, it’s going to be much easier for a forwarder to quote (and move!) your shipment.
Your forwarder will also want to know:
#3: What Exactly Is in Your Shipment?
When your forwarder quotes your shipment with the steamship line, they’ll get a rate back that’s based on the type of goods or equipment you’re shipping. For example, a steamship line will price a container full of household goods differently than a container of industrial chemicals. So if your forwarder asks you a lot of questions about exactly what you’re shipping, they’re not trying to be nosy. They’re just trying to get you the best rate possible! The more detail you can provide for your ocean freight quote, the more room they have to negotiate.
Additionally, if you’re shipping hazardous materials, disclosing what’s in your container becomes critical. Your forwarder will likely ask for the material safety data sheet (MSDS) to make sure your shipment is quoted—and handled—properly.
Once your forwarder understands the contents of your shipment, they’ll also inquire about how you want your items to move from origin to destination. In other words . . .
#4: What Kind of Pickup and Delivery Services Do You Want?
Do you want your forwarder to handle absolutely everything from the warehouse pickup at origin to delivery at the final destination? Or are you looking for more of a DIY approach where you drop off your shipment and arrange for someone to pick it up on the other end? All of these will factor into your quote, so your forwarder will ask for your preferences . . .
- Will you want us to arrange to pick up your shipment?
- Or will it be dock-delivered to a warehouse?
- Will you pick up your shipment at the terminal (also called “will call pickup”)?
- Or will you want it delivered?
- Will it be delivered to a residence or a business (each of which comes with its own pricing tier)?
Once your forwarder knows the options you want, they’ll include those line items in your quote.
Pro Tip from Approved Pricing Manager, Lauren Tokushige: One of the biggest areas that causes confusion with ocean freight is that some customers ask to pick up or drop off their less-than-container load (LCL) freight directly at the port. In a consolidated shipment, your items are combined with other freight in a container. That consolidation happens at a warehouse, not at the port. The same is true at destination: The container gets unpacked (or deconsolidated) at a warehouse, not at the port. Keep that in mind when you choose your pickup and delivery options.
Once they understand the pick-up and delivery options you’re looking for, your freight forwarder will ask one more key question.
#5: Is This a Single Shipment? Or Will You Have More Down the Road?
Quotes generally fall into two categories:
- Spot quotes for a single job, such as shipping a single container.
- Project quotes for multiple shipments, such as 10 containers over the course of the year.
Maybe you’re testing out a new freight forwarder and you’ve requested a spot quote. However, if you plan on regular shipments, be sure to let your forwarder know. They may be able to get you a special project rate that would lower your cost per shipment.
So if your forwarder asks if this is a one-off job or if you plan for future shipments, now you’ll understand the reasoning behind it.
Now, there’s one final area that will affect your ocean rate quote, but your forwarder might not ask you about it. In fact, if the subject doesn’t come up, you might want to raise it yourself.
#6: Fuel Surcharges: Are They Included?
If you’ve been following the emerging effects of the IMO low-sulfur mandate, you might know that forwarders and shippers alike are keeping a particularly close eye on fuel surcharges this year.
Fuel surcharge: A fee charged by a carrier that covers the changing cost of fuel for the vessel or vehicle that carriers your freight. May also be called a “Bunker Adjustment Factor” on your quote or invoice.
For ocean freight, fuel surcharges are dictated by the steamship lines that move your goods. Although many experts are expecting fluctuations this year, steamship lines issue a 30-day notice on changes, and your freight forwarder will pass that information along to you as they receive it.
When it comes to your quote, look for two things in this arena:
- Is the fuel surcharge broken out as a separate line item? If not, ask your forwarder to make sure the cost is accounted for.
- How long is your quote valid for? For example, some quotes are valid for 30 days. So if you hold onto it for longer, you may have to have it requoted, and you may end up with a different fuel surcharge.
Because fuel surcharges can significantly change the cost of your shipment, make sure you keep an eye on this line item. Ask any questions you need to understand how it’s integrated into your quote so you can budget accordingly.
Getting All the Details Right for Your Ocean Freight Quote
Every forwarder will run their quoting process a little differently. However, what most forwarders will share is a strong focus on the details of your ocean freight shipment. By getting as much information as possible, your forwarder will have the answers they need to get you an accurate quote—one that shows you, in detail, exactly what you’re paying for.
However, if your forwarder doesn’t ask a lot of questions and, in turn, doesn’t offer a lot of transparency in the quoting process, it might be time for questions of your own. Understand what’s included and what’s not. Make sure you’re getting the services you want. That way, when you receive your final invoice, you’ll find it in line with your budget—and your expectations.
Want a quote for your next ocean freight shipment? We’d love to help! Just reach out to us to schedule a time. We’ll get you a complimentary, detailed quote that will show you exactly what you’re paying for, every step of the way.
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