Shipping logistics is the process of delivering an item across the ocean by means of a ship. This delivery must be conscious of the difference in place and time between the point of production and the point of consumption. In the process, the cost of transportation between the two points should be reduced by considering all the factors at play and optimizing the process. The process should also maintain high standards of reliability, sustainability, and availability as required by the customer.

Effective logistics deals with various considerations that ensure nothing is overlooked. Prediction of the cost of future procurement must be in line with the needs of the present. Items that deteriorate need to be maintained even if not in use at present. However, the cost of maintenance and other variables will be lower at certain times. For instance, military equipment would cost less and would need less maintenance during peace times than during war. And yet there must be a certain amount of supplies maintained even during peace time, because too little supplies during war could be the factor that decides which side wins or outlasts the other.

But logistics is far more than a military issue. A huge variety of businesses in all industries around the world couldn’t function without logistics, with people increasingly looking to international suppliers and markets. Importing and exporting goods is a key application of logistics.

Another time shipping logistics become necessary is when batch sizes get smaller. The challenge is that a business must take care of the needs of each customer, regardless of the size of shipment that they have ordered. Simply put, this requires the proper management of resources. A deep understanding of supply chain management and physical distribution are necessary for success.

Logistics professionals are trained to manage all aspects of logistics management. Various institutions around the world offer professional courses and degrees to train future logisticians. Such professionals should be equipped with the skills to manage and control supply chains in various industries. They must be able to solve problems creatively on the spot and analyze events from a variety of perspectives. It’s an exciting and challenging field that attracts some of the world’s brightest minds, because it moves at a fast pace and uses analytical as well as creative thinking.

If your company lacks the necessary logistic ability, and does not employ logisticians on staff, you can outsource for logistical support from a logistics service provider. This can take the form of another company solely dedicated to planning and managing transportation from a supplier to a final destination. Such a company needs to have customized services with the ability to apply their expertise to wide range of industries. Or you can find a company that specializes and works only in your industry.

One form of outsourcing that is gaining popularity is third party logistics (3PL or TPL). A 3PL provider is a firm that will manage a customer’s supply chain, in whole or in part. Alternatively, you could opt for a fourth party logistics provider (4PLP), in which you can allow the logistics provider to handle all the logistics processes from the supplier to warehousing and the end user. The 4PLP would manage and coordinate the activities of the firms doing the 3PL work. Depending on the size of your business, one or both of these options may or may not make sense for you.

You need a provider who’s going to meet the unique needs of your business. When it’s time to choose a shipping logistics provider, do your research and consider these tips on which factors you may want to consider.

Online Services

Does the shipping logistics provider offer online booking and customer service? Many providers today do, so decide whether this is a time-saving factor that you consider important, or a non-issue for you.

Reliability and Service Commitment

You need to find out about the reliability and service commitment of the company whose services you are hiring. Does the provider handle shipping directly to the destination you want? Sometimes, shipping logistics providers may have list of destinations they serve, but in reality, they have a working connection with another firm that provides direct services to some of the places on the list. There is nothing wrong with this practice, you’ll want to know up front so you have a detailed understanding of exactly who will be moving and storing your goods. This will enable you to make an informed decision. You don’t want to find out anything bad about the provider after you’ve already hired them. This is why it is important you carry out a thorough investigation about the service of a provider before hiring them. Speak to other customers and read reviews if possible.

Accountability

Your shipping provider should be committed to accountability for their services. The day-to-day reality of the industry is unpredictable, owing to a number of factors including weather, mechanical issues, load factors, and the human component of employees. So, will your logistics provider keep their promises no matter what happens? They have to be accountable to your consignment. You must be able to trust their word. Make sure that any agreement you make sets out clear terms for what happens in the event of a problem.

Security

The security of your consignment is paramount, so you have to find a logistics firm that takes security seriously. You need your shipment to arrive in good condition to its final destination. You should make sure that the provider has adequate security features to ensure that nothing happens to your consignment. Security here involves a lot of things. Besides human security, they should have security against accidents and breakages. This means that they should have proper insurance coverage for the carriers. Security also means that the shipping logistics provider should use good carriers and shipping equipment. If their shipping equipment and carriers are not in good shape, it will be difficult for your consignment to get to its final destination without any problems.

Cost

You know you should hire a logistics provider that will guarantee you quality service, but you should also consider the cost of the services. If you spend huge amounts of money to ship your item and you want to resell the item, the cost of the item will be too high. If your competitors are able to see the item at a lower price because they shipped it for a lower price, you’ll be out of luck when you could’ve been ahead of the game. So do the math ahead of time. What’s your actual budget for shipping? There are plenty of providers to choose from, so find the one that’s right for you.

Shipping Terms

The shipping industry has a lingo all its own that it may be helpful for you to learn. If you are entering into exportation and importation business, it is important that you master these terms.

CIF (Cost, Insurance and Freight)

This term indicates that the insurance on the cargo and freight are to be taken care of by the exporter until the consignment gets to the point of delivery. For example, at CIF New York, implies that the exporter will be paying the shipping cost as well as the insurance of goods from the point of departure to New York. The term also implies that the importer is responsible for any other cost and insurance outside New York. In other words, the responsibility of the importer starts once the consignment gets to New York while the responsibility of the exporter ends when the consignment gets to New York.

Best Way

This phrase means that the shipper may use any carrier that charges the lowest price for the shipment of the goods in question. However, in certain circumstances the shipper may opt for a carrier that charges a larger amount. If the carrier offers a faster delivery time, or a better insurance rate, or something like that, the shipper may choose that one.

Free Carrier

This means that the shipper has to hand over the goods to the carrier indicated by the importer who will take charge of the consignment once the exporter hands them over.

Free Alongside Ship (FAS)

This means that the goods will be sent alongside the vessel by the exporter to the stipulated port.

DAF (Delivery at Frontier)

This is an acronym for delivered at frontier which means that the goods will be cleared before the customs by the exporter.

DDU (Delivery Duty Unpaid)

DDU means delivered duty unpaid. This term indicates that the goods will be delivered by the seller at the stipulated destination.

DDP (Delivery Duty Paid)

This means that upon delivering the goods at the stipulated destination, the exporter has to pay the charges for the delivery of goods.

Tips for Shipping

No matter which method of shipping you’re using, there are a few tips that you may find helpful. Here are a few tips that you may be able to apply to your business.

It’s important to use a shipping firm that’s reliable. This means you’ll have to do research on shipping firms up front. The internet is a good resource for this task. Read reviews of shipping firms you’re considering. Ask questions about the reliability of the firms so that you know who you’re getting into business with.

Make sure you’re packing your goods in the right box. This will help you to eliminate or reduce breakage that occurs on the way. You should create a list of all the items you’re shipping and have the shipping company sign this list before and after your shipment, so that nothing is lost during delivery.

Shipping refers to the transportation of cargo by various means, and especially by ship on large water bodies such as the ocean. Shipping can also be done when transportation is done on land or air. Therefore, shipping is taken to be a generic term for transportation of large volumes of goods. Due to the expensive nature of building production facilities with close proximity to ports and limited availability of land, goods have to be transported for long distances from the point of origin to the destination, on land via air or sea, and back to land.

Shipping via land or sea costs less than transportation via the air. Cheapest of all, though, is sea transport. This is because there’s no infrastructure required to ship via the oceans. On land, for trucks, you need roads, truck stops, mechanics, toll booths, etc. Or for trains, you need train tracks and the entire rail system. And for air travel you need airports and all the infrastructure that comes with flying.

Much shipping is done on ships, because although this method is slow, it is the least expensive. Ships can be very large, so they can carry even the largest sizes of goods. There are some types of cargo that are not suitable for ships, though. Anything perishable may not be able to last the length of the long trip. Foodstuffs are probably not suitable, because cargo can take such a long time to reach its destination.

The fastest, but most expensive mode of transport, is air shipping. Air shipping also limits the size of shipments. This form of transport is typically only used for commodities that are urgent, but light.

Land transport is the most common means of shipping when it comes to inland transport. If the road infrastructure is elaborate, shipping by land can be as effective as sea shipping, although at a lesser degree.

When you want to ship cargo, it may be a good idea to learn some of the technical terms used in the industry so you’ll be up to speed. Some of the terms are common and can be understood by anybody around the world. You can also find some terms that are localized. Some terms spell out the responsibility of the exporter and the importer. For example, the term Free on Board should not bring confusion that the shipping is done freely. It simply means that the exporter is supposed to deliver cargo at the location that was specified. The cargo should also be delivered on board the shipping vessel.

As the cargo remains in the vessel, the exporter is charged with paying for the load, its security from theft or damage by the elements. Condensation is especially a major cause for worry among shipping agents. Vibration of the cargo is another problem that occurs if it is not secured firmly in the holding, causing it to move back and forth.