Freight forwarder

A forwarder usually does not own ships, aircraft or most of the trucks it uses. It buys capacity from carriers and combines it with its own services: quoting door-to-door rates, booking space, collecting and consolidating cargo, preparing transport documents, arranging customs clearance and insurance, and tracking the shipment. Its value lies in coordination, turning several carriers, terminals and authorities into one plan with a single point of contact for the customer.

Legally, a forwarder can act in two ways. As an agent, it arranges carriage on the customer's behalf, and the contract of carriage is between the shipper and the carrier. As a principal, it issues its own house bill of lading or house air waybill and takes on a carrier's liability, which is how an NVOCC works in ocean freight. Which role applies to a given shipment affects who is liable for loss or damage and how claims are handled.

Forwarders rely on overseas agents or their own offices abroad to handle the far end of each shipment. Many trade under the standard conditions of their national forwarding association, which limit their liability, so cargo owners often buy separate cargo insurance. A forwarder may also be a licensed customs broker, but not every forwarder is one, and the licensing rules for each role differ from country to country.