Understand how quotation works on international cargo transport

Understanding the details involved in international cargo shipping is important. After all, it is associated with several opportunities and represents almost all foreign trade services. To deal with the costs involved in the process, there is the broker — who carries out the quotation of freight and other services.

To further deepen the theme, we spoke with Daniela Kawano, Corporate Manager and Procurement & Pricing and Thais Perrella, Corporate Manager Ocean Product at Allink. A pioneer in the LCL (less than container load) segment, which will be addressed throughout the content, the company tends to enrich the understanding of the process. Follow!

How does quotation in international shipping work?

The quotation in the sphere of international maritime transport is based on the origin and destination of the cargo, according to a commercial agreement with the buyer of the goods, called International Trade Terms — INCOTERMS. According to Kawano and Perrella, they are involved in international cargo transportation: the importing or exporting company and the freight forwarder or freight forwarder – an intermediary that facilitates the contracting of transport and logistics services within foreign trade. The carrier can be a shipowner (company responsible for carrying out maritime transport) or NVOCC.

Through contact that can be by email, phone, Skype or WhatsApp, the service is requested, and the quote starts. To carry it out, then, some factors are considered:

• cargo destination.
• source.
• INCOTERMS used.
• type of shipment, which can be specific or with regular frequency, among others.
• volume (CBM, weight, quantity, type of merchandise).

A fundamental part of understanding the theme is knowledge of the concept of NVOCC, which stands for Non-Vessel Operating Common Carrier. The professionals point out: “He is a shipowner; he transports cargo and assumes responsibility for transportation before the shipper. While he is, for the shipowner in fact, his shipper.

In other words, the NVOCC ideal concerns a sea carrier without its own vessels, which, therefore, uses the owner who owns it. The main services offered revolve around cargo unitization.

By it, according to the experts: “The placing of several loads in a container for those shippers who do not need to use the entire space of an entire container”.

Hence the term LCL – less than container load, or Container with less than its capacity, that is, a term used when the load does not fulfill the maximum or total capacity of a container. 

What are the main points to be considered when quoting international cargo shipping?

Having defined the concepts of international transport, we have NVOCC, cargo unitization and LCL, it is possible to fully understand the operation of the service. It is also interesting to keep in mind that there is another type of maritime transport quotation in addition to LCL. 

This is FCL – full container load. While the less than container load does not occupy the entire container space, the full container load does. According to Allink professionals, the process, in both cases, can be carried out:

• port to port.
• door to door.
• port to port.
• door to port.

Kawano and Perrella also state that “the type of service and mode will determine the value per unit (container or cubic meter / weight)”. In this way, each case is analyzed individually in freight negotiation.”

When working with a qualified company, it is also possible to count on other interesting solutions in terms of maritime agency – shipping agency -, such as international cargo insurance – which works with various modalities and is of great relevance for those who work in commerce outside.

What are the necessary precautions in international maritime cargo transportation?

The qualification of companies is the first factor that requires attention from those responsible for contracting ships, logistics and receiving. It is important since, in addition to insurance for adequate cargo transportation, the correct customs clearance must always be carried out to detect any irregularities in the process. Then, a few more points will require attention. Look!

Complete information

Experts confirm the importance of fully accessing data: “The calculation of sea freight – ocean freight – varies according to some data that need to be considered by the carrier.

For this reason, it is particularly important for the customer to send complete information to prepare the best proposal, considering the appropriate service and route for this transport.”

The information that must be provided is diverse and, in addition to those already mentioned, include:

• type of product, considering, for example, if it is dangerous or refrigerated.
• weight.
• kind of packing.
• dimensions.
• type of container and size, if using FCL.
• quantity etc.

Service of the contracted organization

The customer must pay attention to the fact that cargo transportation is a commercial operation that has some obstacles and risks. For this reason, it is necessary to look for a service that is not only agile, but also efficient, in the event of an accident. The speed in complying with certain procedures is essential for maintaining the financial health of your business.

High-level cargo transport

There are several laws, mandatory procedures and rules that surround the universe of commercial representation ships, their shipowners – carrier – and charterers – charterer. In addition, the changes and updates that occur with each change in legislation require knowledge on the part of service providers so that the transportation offered is of a high level. 

To choose the ideal partner service, it is interesting to focus on:

• the choice of professional service providers capable of helping.
• the contract details.
• real-time transport status information.
• humanized / personalized service.
• the risk management plan.
• the level of expertise etc.

How is Wilson Sons able to assist in the international cargo shipping process?

Wilson Sons Services operate in the main ports in Brazil through 18 own branches. Whether in the logistics of equipment and shipping documentation, or in the operational service of the regular and non-regular fleet ships, it is possible to count on their expertise.

Other services covered by its professionals include:

• demurrage control.
• cargo brokerage.
• container logistics management.
• documentation relating to maritime transport.
• assistance to crew and commanders.
• port and market intelligence.
• fundraising and more.

The complexity of international cargo shipping requires the presence of specialized professionals. Since the future of cargo transportation quotation will require the presence of digitalization, artificial intelligence, and self-services – accelerated by the current pandemic context – having a company that offers agile communication and solutions without renouncing human contact will be essential.

Count on us for that! If you want to know even more about the solutions offered by Wilson Sons, get in touch now.