April 1, 2021

What Is the Difference Between an International and Domestic Forwarder

Miles Varghese
Miles Varghese
Helping independent freight forwarders/brokers better stay in-sync, collaborate, and improve operations with their shippers/clients. Co-founder & CEO @ Cargologik.com
domestic freight forwarder

Freight forwarding is a straightforward and complicated process that is also a critical component of the modern-day supply chain. Both international freight forwarding and domestic freight forwarder services are vital to keeping supply chains up and running. Distinguishing one from the other in name and function is relatively easy. When goods are moved from one point to another within the same country’s borders, domestic freight forwarder and carrier options can be used. 

However, when international lines are crossed during transportation, international freight forwarder and carrier services need to be utilized. According to PR Newswire, the global freight forwarding market size is predicted to continue its growth and to reach a net worth of more than 207 billion dollars USD by the year 2026, a jump from the estimated 170 billion USD value it had in 2019, at a CAGR of 2.8% from the 2020-2026 cycle. This high demand and continued expansion of need and capacity drive the freight forwarding market, especially today.

Understanding Freight Forwarding and Its Role in Transportation

To fully understand the role international and domestic freight forwarders have within the transportation and logistics industry, one must first understand what a forwarder does. Freight forwarders serve as essentially an intermediary position that bridges the gap between the company that manages the shipment and the load’s final shipping destination. While their goal and purpose are not to carry out the payloads themselves, they provide a range of transport modes that supply chain management can choose to take advantage of the transportation order. International freight forwarders may use sea/ocean freight and rail freight, while domestic freight forwarders may be more likely to utilize road transport and air freight shipment options. Either forwarder can use any method and mode; it all depends on where the loads start and where their final destination lies.

Key Characteristics and Services of a Domestic Freight Forwarder

The domestic freight forwarder is most likely to engage in the following services and actions during large load transportation:

  • Specialize in intra- or inter-state transportation for close-to-home shipments and loads.
  • Offer help with finding another mode of transport when existing carriers lack capacity.
  • Be experienced with a range of cargo types and shipment methods to ensure timely delivery.
  • Understand laws and regulations governing goods and produce crossing state lines. 

Key Characteristics and Services of an International Freight Forwarder

The international freight forwarder is likely to engage in these practices as opposed to a domestic freight forwarder: 

  • Handle rush orders that need to travel long distances and cross over country borders.
  • Be prepared and well versed in customs, laws, and restrictions for international shipments.
  • Provide assistance with finding warehousing for shipments while awaiting transport.
  • Manage documentation to ensure compliance with laws as mentioned above.
  • Validate and secure cargo or freight insurance on international shipments and address any liability issues for that freight while in international transit. 
  • Offer fast and reliable shipping where other carriers and shippers might otherwise struggle. 
  • Understand the need for planning, communication, and negotiating by using technology in freight forwarding.

Leverage Digital Forwarding Resource Systems to Achieve Success

Using international and domestic freight forwarders can help open new doors of opportunity for logistic managers. Working within national borders and internationally allows for greater cargo capacity and acquisition and increases the number of customers the supply chain can service.  Any third-party partner or vendor needs to be well versed in the differences between international and domestic freight forwarder service analytics and metrics so features and benefits can be efficiently maximized from the very start. Connect with Cargologik to get started. 

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