Courier or freight forwarder ?

What is the difference between freight forwarder and a courier?  I have been often asked that question. Well, from operational point of view the difference is tremendous but from customers point of view the difference is none. Why?

The customer perception is that both couriers and forwarders offer the same service – delivery of shipments from one point to another. And this is really the case. But the courier does it one way and the forwarder does it in another.

Normally couriers supply door-to-door services and they operate in their own systems or connect to specially organized systems.  This networks, are integrated and in-separable as processes. That is why couriers are often called integrators.
Once your shipment gets in this network it is delivered to the address shown on the airwaybill and the customer has no control on it. This appears to be very economic and efficient way for smaller shipments because there is no accumulation of all minimum rates which the forwarder should charge if the same service is offered through forwarder. Actually for small shipments, couriers benefit from the change of fixed cost involved into variable – per kilo or per shipment cost.
This is one of the reasons why couriers have tarrifs which show cost country to country.

From the other side, if your shipment is relatively big the courier networks are not suitable because then the variable costs involved become higher compared to the cost which forwarder calculates for separate shipment. Also if customer’s terms of trade are different from CIF, DDU or EXW than the couriers are unable to separate which at the end in practice changes the delivery terms. If you have sold small commercial shipment on terms of delivery FOB Sofia airport and have moved it with a courier from Sofia to Sao Paolo for example in practice you cannot split the cost from your warehouse to the airport through which the courier operates (it might be not Sofia) and which is more important you cannot split the liabilities caused from the terms of delivery.

Here we have the forwarders involved. The forwarder will consider your specific shipment with its specific parameters – weight, commodity, dimensions, stackability, customs value etc. and will move it in the most appropriate way taking in consideration all of the peculiarities of your freight.  Forwarder can build you routing or package of interrelated services which will respond to customer’s terms of sale and if the shipment is bigger forwarder will offer the benefits of moving bigger shipment on specially dedicated routing for this particular shipment.

This way of operations is reflected in the way forwarders provide their rates – per kilo, per weight break per CBM very often quoting the taxes for handling, customs processing etc.

So from one side we have couriers, with their integrated but also encapsulated networks – effective for smaller parcels and expensive for bigger and from the other side we have freight forwarders with their flexible systems – more expensive for smaller shipments but providing flexibility for bigger or special freights (like hazardous material for example)

Whom to choose?  Here is a short advise which may assist you when you take decision.

If you have shipments which is considered as general cargo and weights less than 10 kilos – couriers in 90% of cases will provide more effective service.  If you do not have special requirements for delivery to the final destination, if your shipments is not valuable, if your shipment is not considered dangerous goods – with few exceptions – yes, take the courier.

However if your have some specifics in the terms of delivery, your shipments is considered hazmat, or it weights more than 20 kilos. If you want some one to make very special delivery outside the operational window of the courier or if you are moving valuables or live animals – than forwarders are your choice.

In order to satisfy this wide range of requirements and specifics we in KG CARGO have special contracts not only with leading air and ocean carriers but we have good relations with couriers like DHL such being able to satisfy often contradicting requirements of our customers and partners providing the benefits of the two approaches – the courier and the forwarder’s

The Bulgarian freight forwarding company KG CARGO considers any and each of your requirements for reliable delivery on acceptable cost and tranzit time.  If you want to ship a load from Bulgaria or if you want your loads into Bulgaria properly handled please contact us and we will come with  a solution to you.

You can also use our special air freight transportation rate request form which is designed in a way to lead you in the process of providing proper information for your intended shipments which results in better prices and more appropriate handling and routing.

For more information on KG CARGO freight forwarding service please contact us.

14 thoughts on “Courier or freight forwarder ?”

  1. Venkat

    Hi Georgi,
    The package weight would be 8 kgs , If i need to send this package form A place to place B in different country’s.
    When we need the customer clearance of cargo, Whether in terms of cargo weight / value of cargo / tax benefit …???
    Clarify, How could i send this package through courier mode or Shippement mode and why..???
    Thanks in advance.
    Good Day
    Venkat

    1. Georgi Stoilov Post Author

      Dear Venkat,

      I am sorry but I do not understand what you are asking.

      The weight of a package has nothing to do with the customs clearance.

      Customs clearance is value related rather than weight related.

  2. BRENDA

    Hi there

    I work for a catalog retailer and need to get samples in from China which contain batteries. The supplier does not have the paperwork. How can i get these samples from China to South Africa?

  3. Caner Onoglu

    Hello Georgi,
    Please evaluate this situation:

    Company A-Moda is a textile manufacturer in Spain. Its clients are individuals in Moscow, Russia who order through Company A’s internet magazine. Company A-Moda has around 50 orders per week from Moscow. Each order is in average 200 gram. A-Moda is looking for the cheapest option to forward the goods to final clients. They first consider working with a freight forwarder but they face difficulties. First for each shipment they need to go through custom clearance in both countries, pay for Airway bill,and the last but worst for each textile group they need to obtain certificates in Russia. Also they need to have a legal presence in Russia or work through an intermediary company which will be the importer. Although the rates per kilogram they get from the freight forwarder is much cheaper compared to the rates of Courier company the other costs and obstacles make it unfeasible. So they approach the courier company which can receive the goods for each individual and can forward without custom clearance because this time it is for personal use and much simplier custom procedures applies. But the minimum rates for each package are around 30 USD which makes a 20 USD t-shirt 50 USD and it is too much.

    What I want to ask you is this: Can Company A-Moda develop a system which will be in between Freight Forwarder and Courier. As all the packages goes from one specific city to another city can they consolidate those 50 orders in one 10 kg package and get rate for the whole package from the courier company? At the destination the big package is deconsolidated and custom cleared through green line without custom duties and need for certificates and goes to individuals.

  4. olivier

    Hello Georgi,

    What about is we need 1 partner for both services?

    I am working in the retail, worldwide and I would like to have the possibility to find a solution helping me to to collect/send each order/parcel from me or enable my clients to use only one partner/account.

    Like a courier-freight merged together

    What do you advice?

    Thank you
    OM

    1. Georgi Stoilov Post Author

      Couriers and freight forwarders operate different ways. And that has always amazed me because at the end they do the same thing – physical movement from side A to side B. Wrapped in various different activities like customs, handling, information processing etc. That is why we try to be flexible and to present our customers with what they really want – reliable movement of goods on acceptable price.

  5. Mina

    Dear Georgi,
    Thanks for your very useful article
    I want to ask about the difference between Courier and Carrier.

    Thanks Very Much

    1. Georgi Stoilov Post Author

      Dear Mina,

      Very good question. Very often Carrier and Courier are mixed as at the end they do similarly same job – physical movements of goods from point A to point B. However there are differences in the way this movement is performed and … legislation of the entity.

      Carriers are on first sight registered as such. Each country in the world has a register of the carriers – whether motor carriers, airlines or shipping lines whereas the courier business is not that much regulated. Also the carriers have some form of ownership and responsibility on the vehicles they operate – they own or lease trucks, they own or lease planes, they own or charter vessels. Couriers from the other side might not own – in most case they even prefer to not own the vehicles. Couriers buy vehicle capacity.

      Also carriers have some limitations which depend on the limitations of the vehicles they operate. For example an airplane can not land anywhere it should only land at an airport. So air carriers normally provide services on airport-to-airport basis. It is unusual for an air carrier to provide a door-to-door service. And Door-to-door is the main service couriers provide.

      Well, motor carriers when it is about LTL movement provide almost the same service as courier however the couriers concentrate more on standardized packaging and shipment sizes whereas the motor carriers do not limit themselves.

      I give you an example: DHL Express is a typical Courier or integrator. They have a whole system for door-to-door delivery of shipments consisting of standard packaging – boxes and pallets. There are certain limitations – unit weight, dimensions of the shipment, commodity and … DHL Express is not owner of big part of their network. They just operate it.

      EAT or DHL Aviation is an air carrier who flies the DHL traffic (most of it) between various airports in the world. They own or lease the aircrafts they use but firstly their operations are heavily regulated and secondly they operate only airport-to-airport.

      So for example if you would like to move something between an address in lets say Troyan, Bulgaria to Paris Texas, USA – normally you will seek a company that can do the job and airline is not able to do this. Because there is no airport in Troyan, neither in Paris Texas (there is no at least International Airport)

      However if you want to move the freight only between nearest airports most probably you will use a forwarder who will move on a carrier like DHL Aviation between Sofia Airport and Houston International Airport.

      I hope this answers your question

    1. georgibstoilov

      Dear Ashik,

      some couriers place limits other does not. It depends on the courier policy, but normally shipments up to 30 kilos chargeable weight are more effective to be moved via courier.

      30-70 kilos is mixed

      and over 70 kilos normally airfreight door-to-door via a forwarder is better. Of course there are many factros like tranzit time , cost, customer service etc.

      If in doubt, anytime you can contact us at http://kgsid.com/contacts/

      Best Regards

      Georgi

    1. Georgi Stoilov

      Dear Geof,

      good question. Actually as mentioned in my article above the freight forwarders provide door-to-door service but it is cost effective for bigger shipments – 50 kilos and above. For lesser shipments courier or so called integrators provide better service. Of course I am comparing only the services based on air transportation. There are however some economy solutions based on ocean freight and road freight.

      From the other side many forwarders have contracts with integrators and can provide service based on these contracts. At least in Bulgaria this is a practice.

      In sum all depends on customer demand and how this demand is presented to the forwarder. And remember – expensive and cheap are very vague terms. Better compare what you are ready to pay for certain service and what you are not ready to pay.

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