Working in the logistics industry, many people need to know what warehouse and freight forwarding services are available and what package movement logistics companies do.
There are several factors to consider when deciding which type of shipping business to choose; what products you will be shipping, how large your order is, how many shipments you will need per week or month, and your budget.
In this brief blog article, we’ll cover the key differences between “warehousing” and “freight forwarding,” along with some pros and cons so you can decide which kind of business would be a good fit for your product.
What Is a Warehouse?
A warehouse, which is usually constructed by commercial contractors, serves as a central hub where goods are systematically stored, anticipating the moment they will be picked up by the consumer. The organized placement of goods on racks and within designated storage areas is meticulously orchestrated by dedicated employees who diligently work to ensure that products are readily accessible at the front of the store for efficient pickup.
As a business owner, finding local warehouse facilities for your business should not be difficult either, and moreover, it can prove as an easy fix for most of your storage issues.
What is a Freight Forwarder?
Freight forwarding is a shipping and logistics business that handles the transportation of goods from one location to another. Freight forwarders arrange for carriers, shipping containers, and other supporting materials to move cargo from one point to another. They are considered the ideal choice when it comes to heavy machinery shipping. The freight forwarder typically assumes all costs associated with transport, including insurance, tariffs, and taxes.
There are two main types of freight forwarding: direct freight forwarding and indirect freight forwarding. Direct freight forwarding is when the freight forwarder takes possession of the goods in their warehouse and ships them directly to your customer. Indirect freight forwarding involves having the freight forwarder take possession of the goods but then sell them to a third party who will ship them to your customer.
Direct and indirect freight forwarding has pros and cons, so choosing the best option for your business is important. Here are a few most important things to consider when choosing a freight forwarder:
Large freight forwarders tend to have larger warehouses that can handle more shipments at once, which makes transferring orders faster. They also have more resources, such as trucking companies and shipping containers, which means you can receive your items faster than if you were using a smaller forwarder.
Using a large-scale freight forwarder may be less expensive than using a smaller one because they can offer lower rates for shipping multiple packages simultaneously. Additionally, large-scale forwarders often have special deals available.
Advantages and Disadvantages of Each
Assuming you are looking to move an item from one location to another, and not from one seller to another, there are a few options available to you. Each option has its own set of advantages and disadvantages.
Advantages
Warehouse
The obvious advantage of general warehousing from Graysons, or any company for that matter, is that it can reduce the time required to pick up, pack, and ship an item. This is because the warehouse can handle the storage, shipping, and processing all in one place.
Freight Forwarding
Freight forwarding is similar to using a warehouse in that it can reduce the time required to pick up, pack and ship an item. However, the main difference between freight forwarding and warehouses is that freight forwarding does not handle the storage, shipping, or processing of items. Instead, freight forwarding provides a platform for businesses to contract with freight carriers to transport their products.
Disadvantages
Warehouse
The disadvantage is that it can increase the cost of the item due to the additional overhead costs associated with operating a warehouse.
Freight Forwarding
The disadvantage of using freight forwarding is that it can increase the cost of the product due to the additional fees charged by freight carriers.
What Else?
Regarding shipping, one option is to have your product shipped from a warehouse. This is a good option if you have a large number of products that you need to send out at once. On the other hand, freight forwarding is a better option if you only need to ship a small number of products at a time. This is because freight forwarding allows you to get quotes for different shipping methods and choose the one that best fits your needs. Which option should you choose? It all depends on the size of your order and the type of product you’re shipping. If you have questions about which option would be best for you, contact us at Ship-Hero, and we can help you decide what’s best for your business.