In the standard air freight business, the rate system offers rates per kilo. The bigger the consignment, the less rate per kilo is giving. If you run a business and you have shipment that needs to be shipped to most domestic and international destinations, for shipments that are too small, if you decide to air freight your shipments by standard air freight services you will pay more in shipping costs. What to do?
Here is the answer, Air Freight Consolidator becomes a much more cost-effective option for moving your shipments by air. Consolidated air freight can get your shipments where they need to go, at a price that won’t break your budget.
In
this article, you will be able to understand what Shipping Consolidator do and
how you can benefit from his services.
What is Air Freight Consolidator?
The Air Freight Consolidator
is a freight forwarder [may be an individual, firm, carrier, and an agency]
specialized in air consolidation (groupage). Freight Consolidator send you
shipment combined with other small shipments via shipping consolidation,
however, you will pay a smaller freight rates and benefit from other advantages
such as:
·
Faster delivery
·
No damages during transport
Freight
Consolidator take the advantage of the freight rate structures making up
consolidations to the mutual economic benefit of both customers and agents.
Now,
i will explain the consolidation process.
Freight Consolidation Process
Air
Freight Agent that offer standard air freight service will arrange, dispatch,
via scheduled airline, of single shipment that are documented and forwarded
separately at normal published airline rate.
While,
the freight consolidator assembles a number of individual shipments and
dispatches them as one bulk shipment on one air waybill. This practice is
called consolidation. The consolidator can send several shipments as one
shipment to one common destination. This type of load will be consigned to a
representative of the freight consolidator whose task is to break up the
consolidation and to arrange clearance by himself or by another party of each
individual shipment within the consolidation.
Air Freight Consolidator Responsibility
The
freight consolidator's responsibility goes beyond delivering the shipment to
the airline at the airport of departure. It extends to the recovery of shipment
from the airline at destination and, where requested, to its delivery to
consignee.
The
freight consolidator performs two roles:
Frist role: Indirect Carrier
Responsible
to you ( as a shipper ), as principal, for the transportation of the shipments,
this responsibility applies to each individual shipment in the consolidation.
Second role: Principal
In
relationship with the airline, as a carrier, for the carriage of the whole
consolidation as one shipment.
Note:
This responsibility may be change in if the air freight consolidator is a
carrier itself. I recommended that, you at all times, you review the air
freight consolidator responsibility before you send your shipment.
You
may ask what the ..
Difference between consolidated and individual shipments
Individual
shipment
The individual or direct shipment is delivered by
the air freight agent [ freight forwarder] acting on behalf of
his principal, the airlines, in the capacity of an authorized representative
The air waybill covering the individual/direct
shipment is issued by the air freight agent [ freight forwarder], bearing the
names and addresses of the shipper and consignee
Consolidated shipment
The consolidated shipment (groupage) is delivered
by the consolidator acting in the
capacity of a client of the airlines.
The air waybill or master air waybill covering
the consolidated shipment is a transportation
document for the airlines and is issued by the consolidator
who is shown as the shipper.
The master air waybill covers several individual consignments
grouped together whilst a
house air waybill is issued for each individual consignment.
I will more explain this:
Individual shipments:
One air waybill
Consolidated
shipments: Two air waybills
The maser air waybill for the airline and
The house air waybills for individual customers
of the Freight Consolidator (it's for internal
use).
Air Freight Consolidator - Rate Structures
The Freight Consolidator produces his own freight
tariff (consolidation tariff or wholesale rate) for the carriage of air freight
on his consolidation.
Air freight consolidation rating is based on the
gross or volume weights (density weight versus dimensional weight), whichever,
is higher, the airlines will use.
Let us assume that the following is Yemen Airways
freight rates from Aden to Cairo, the rates go by the weight break:
|
From : Aden ,ADE (YE ) |
CURRENCY YEMENI RIALS YER
|
|
|
To Cairo, CAI (EG) |
Weight Break |
Freight Rate Is not the current rate just for explaining purposes |
|
|
Minimum |
4073.00 |
|
|
Less than 45 K |
921.65 |
|
|
45
K |
699.30 |
|
|
100 K |
643.30 |
|
|
300
K |
570.30 |
|
|
500 K |
499.30 |
|
|
1000
K |
450.20 |
Note 1 : Rates and weight breaks will not
match from destination to destination, as each has its own rate structure.
Note 2: “How do you calculate "volume
weight?" click on the link and read my previous article.
Example:
Base on
the freight rate above
|
will be charged at an assume rate ( e.g. GCR Q 45
kgs ) of YER 699.30 Per kilo, whereas |
70
kgs |
|
will be charged at an assume rate ( e.g. GCR Q 500 kgs )
of YER 499.30 Per kilo. |
700
kgs |
Now, I
will further explain that, can you compare between the total costs for each
shipping method.
|
Total costs |
Rate per kilo |
Description |
Weight |
No of the shipments |
Shipping Method |
|
|
YER
489,510 |
YER
699.30 |
Individual
Shipments |
70
kgs each |
10 |
1 |
|
|
YER
349,510 |
YER
499.30 |
One
Shipment |
700
kgs |
1 |
2 |
|
|
YER
349,510 |
YER
499.30 |
Individual
Shipments consolidated to one shipment |
70
kgs each |
10 |
3 |
|
Consequently
Each
shipper's saving would be the difference between:
|
YER 48,951 |
The
airline's rate GCR Q 45 kgs of YER 699.30 Per kilo for shipment of
70 kgs |
|
YER 41,930 |
The
consolidator's rate GCR Q 45 kgs of YER 599 Per kilo for shipment of 70 kgs |
|
YER 7,021 For each shipper |
Total
saving |
The
consolidator's profit would be the difference between:
|
YER 419,300 |
His
wholesale rate of GCR Q 45 kgs of YER 599 Per kilo for 10 shipments of 70 kgs
each. |
|
YER 349,510 |
The
airline's rate GCR Q 500 kgs of YER 499.30 Per kilo for shipment
of 700 kgs |
|
YER 69,790 For Air Freight Consolidator |
Total profit |
Note: General
Freight Rate Only .
Services Offered by the Air Freight Consolidator
The Freight Consolidator offers a wide
Assortment of Consolidated Air Freight Forwarding Services that include
Shipment Pick up, Express , Customs clearance, Time convinced delivery and
All-in-One Distribution to a Vast range of Worldwide Destinations.
Documents Required for Transportation by Air
The documentation required for dispatch of a
consolidated shipment is the same as for an individual shipment as far as the
airlines are concerned.
Consolidated shipments: Two air waybills
The master air waybill for the airline and
The house air waybills for
individual customers of the freight consolidator (it's for internal use).
All house air waybill will be forwarded with the
consolidation in a sealed envelope, accompanied by a load list or
manifest itemizing all the individual shipments by house air waybill
number so the freight can be identified. The envelope will be attached to
master air waybill.
Conclusion:
For companies that ship a high volume of small packages, consolidation services can provide substantial savings. Currently, many carriers such as UPS and FedEx are providing the consolidation services with smart planning [ Creation of Carrier Consolidation Services].
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