There are various entities play vital role in international trade to ensure the smooth movement of goods across the borders. Three of those are Shipping Line, Non-Vessel Operating Common Carrier (NVOCC) and Freight forwarder. All three are important players in shipping and transportation industry. They look similar in first impression but their operations and services and different from each other. In this article, we will explain the operations, similarities and differences between Shipping line, NVOCC and Freight forwarder.
Shipping Lines: Shipping lines are the carriers which carries the
goods from one place to another by their own or leased vessels.
Shipping lines own or lease vessels (ships) for
their operations. They also own various shipping containers of different sizes
as per the requirements. Shipping lines have pre defined routs and fixed
schedules for their vessels. They provide regular services between different
ports at a regular interval of time.
Non-Vessel Operating Common Carrier (NVOCC): NVOCC is an ocean and inland waterways carrier, NVOCC
operates as a shipping line and does all the operations which a shipping line
does, the only thing is they don't have their own vessels. NVOCC buys
the space/slots in vessels and sells the same to it’s customers. NVOCC buys the
slots from shipping line in bulk (more in numbers), they enter into a contract
with shipping line, as per the contract NVOCC buys the a certain number of
slots for a year so that they can get guaranteed space with a favourable price.
Sometimes NVOCC own containers and sometimes they take lease. They also
provides cargo consolidation services to multiple shippers using FCL or LCL
loads based on the volume of cargo.
Freight Forwarder: Freight forwarder is an intermediary between shipping line & the exporter (shippers) and sometimes importer (consignee). Freight forwarders do not act as career, the co-ordinate with exporters/ importers & carriers and make the shipment happens. Freight forwarder negotiates for freight with the carrier (shipping line) and sells to the exporter or importer after adding their margin; they do the activities like booking, arranging containers, making sure containers are loaded into the vessel within cut off time, collecting shipping instructions from shipper and submitting to the shipping line and other documentations. Freight forwarders can move the cargo using multiple modes of shipping, such as marine, air, road & rail.
Shipping line & NVOCC act as the carrier but freight
forwarder acts as the intermediary between carrier & exporter or importer.
We have already written various articles on Export, Import, Logistics & Supply chain management; click on below links if you want to read.
How to book containers and bulk vessels
How to handle containerized cargo / Container operation
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