• FCL is an acronym used in logistics, which means ‘Full Container-Load’. This means goods from a single shipper occupy the entire container. FCL shipment have the following advantages:
• Have more flexibility and control over your FCL cargo.
• Be responsible for loading and unloading and avoid possible rough handling that comes with LCL shipping that risk damaging your cargo.
• FCL may be the more economical option even if you don’t occupy the entire container.

LCL is an acronym used in logistics, which means ‘Less than Container-Load’. LCL is used when a single shipper’s goods do not completely fill an entire container. When this happens, in order to fill an entire container, space in the container is split between orders and/or shippers. LCL shipment may be cheaper as the rates adjusted according to the cargo volume and weight and more agility during customs clearance.

Firstly, it is important to choose a logistics partner that understands the complexity of shipping and hits your target schedule. They would go beyond to achieve your business needs by making sure all your orders are included, wrapping them safely, and taking the necessary steps to ensure a smooth delivery process as much as possible.

Secondly, maintain a clear communication with various parties. Make sure your overseas supplier on imports or if you are the supplier for an export shipment, creates all of the necessary documents correctly including packing lists, commercial invoice, original bill of lading in a timely fashion. so that all documents are provided with the necessary banks and sent to you (the importer) or your buyer-consignee on the B/L (if you are the exporter) at least 1 week before cargo arrives the destination so that everything can be processed through customs ahead of schedule and freight can be paid along with presentation of the original B/L. One factor that usually slows this process down is when there is discrepancies between the buyer and supplier and since the goods are not paid for, the OB/L has not been surrendered by the Supplier to the Consignee (buyer).

Freight: This is the base rate charged by the carriers.

BAF (Bunker Adjustment Factor): This is also sometimes referred to as FAF, or Fuel Adjustment Factor. This is a compensation fee for the shipping vessel’s fuel cost, which can sometimes fluctuate and get adjusted last minute without prior notice.

CAF (Currency Adjustment Factor): This is a charge that applies when the shipment is payable in a foreign currency subject to major exchange rate fluctuations. It compensates for any existing exchange rate risks.

EIS (Equipment Imbalance Surcharge): Shipping lines sometimes impose this temporary charge in order to recuperate the loss of having to transport container between countries with a trade imbalance.

GRI (General Rate Increase): A General Rate Increase is the adjustment (normally an increase) of freight rates across shipping routes by shipping lines.

Congestion: This fee involves shipping vessels sometimes having to line up and wait for their turn to load and/or unload.

PSS (Peak Season Surcharge): This is a fee that’s applied during the peak shipping season. It applies to all shipments being transported along certain trades during the busy periods.

LSF (Low Sulfur Surcharge): This fee offsets additional costs incurred by shipping lines for switching to cleaner fuels in Emission Control Areas (ECA). It came into law at the start of 2015.

• Local Charges

THC (Terminal Handling Charge): Every port has varying handling fees. THC represents the fees incurred at the ports for the handling of goods.

Port Taxes: A fee charged by the port or harbor authority for using its facilities at the port.

B/L Issuance: This is a charge issued by the shipping line for sending out the Bill of Lading.

Seal: Shipping lines sometimes charge a seal fee for having to change container seals or any documentation related to the container seal.

Cleaning: Shipping lines occasionally apply this surcharge if/when a container requires cleaning.

ISPS (International Ship and Port Facility Security): This fee is aimed at enhancing maritime security. Introduced post Sept 11, it grants certain countries the right to take appropriate measures to enhance the security of their ports and arriving vessels.

If your international shipment stays beyond a certain amount of allowed free time at a site, you face storage charges. That includes ports, airline terminals, rail facilities or a bonded warehouse. The storage fee compensates the facility for the use of their space and equipment, i.e., a container taking up space or blocking processing. The number of free days and the charge for storage will differ from one facility to another. This is often also based on the volume you or your freight forwarder is passing through the facility.

Demurrage Charges

Steamship lines and airlines will charge you demurrage fees to compensate for the use of their shipping containers (some airlines use containers for air freight). You are granted a limited number of free days, depending on the carrier and the location. After your free time runs out, you will be charged demurrage fees for each additional day. These charges tend to increase per day after exceeding a certain number of days.

Demurrage charges are in place to discourage using the provided containers for storage and to compensate for container usage. Before you pick up your international shipment, you must pay all demurrage charges in full. The fee may differ greatly from carrier to carrier and from port to port.

Here’s an example of demurrage fees: You have 7 days of free container usage. After that, a charge of $100 per day applies for 3 days. From 4 to 10 days, the fee rises to $250 and finally to $350 for any day exceeding ten days.

Detention Charges

Detention fees usually apply to domestic trucking. The trucking or drayage company bills you for the so-called detention of their trucker or driver in cases. This happens when the loading or unloading of your shipment or containers takes too long. Detention fees are billed at an hourly rate. You can usually expect a free time or grace period of around one to two hours for loading or unloading a container. But this will depend on whether it is a domestic shipment or destined for import or export.

A trucking company will also charge detention fees if their drayman/trucker has to wait until the loading/unloading of a shipment. This will happen in cases of congestion at the facility – when a port of railroad dock is busy. Demurrage charges due to extreme congestion form, unfortunately, a frustrating part of international shipments. You have to pay these fees even though the congestion is beyond your control or that of your freight forwarder.

A second definition of detention can be a storage charge. A carrier may call it detention when you leave a container shipment beyond a certain amount of free time at the terminal. The common name for this case is Per Diem.

Per Diem Charges

Per diem charges (from the Latin, meaning per day) applies when you require the use of equipment beyond a set amount of free time. Steamship lines and airlines charge these Per diem charges, and equipment include ocean containers and unit load devices (ULD). You have some free days, depending on the equipment and the carrier, before per diem charges kick in. With imports, the charge applies to cargo leaving the arrival terminal. With exports, it applies to shipments leaving the departing terminal. Per diem charges accumulate until you return the equipment to the terminal of the port, rail yard dock or airline.

Always! Just as with home or car insurance, you are protecting yourself from potential damages or losses that may occur. Specifically, marine cargo insurance can cover damage, loss, theft, non-delivery, etc., while your goods are in transit. One thing that makes marine insurance different than your home or car insurance is a concept called “General Average.” A general average scenario occurs when some cargo is sacrificed to save the voyage. This sacrifice might involve jettisoning some containers to stabilize the ship in a severe storm. General Average states that all cargo owners are responsible and will share in the loss (even if your cargo was not lost). Marine insurance can protect you against a general average situation and avoid the additional expenses with retrieving your cargo.

All Link will initiate contact and work with all vendors in the supply chain to ensure smooth and timely product flow to the manufacturer, including complete information flow to assist in review and planning functions.

Choosing a freight forwarder that doesn’t have an OTI/NVOCC license is a BIG mistake and can cost you a fortune because there are freight forwarders that operate without an NVOCC license. This license, issued by the Federal Maritime Commission (“FMC”), allows the freight forwarder to issue its own House Bills of Lading (“HBL”). In order to obtain the license, the applicant must demonstrate expertise in the field, financial stability and reveal the company’s true owners.

In addition, the license requires a surety bond. That bond has been placed for your protection. To ensure that the freight forwarder is in compliance and you would be recompensed for any unforeseen issues check to make sure your freight forwarder has an OTI/NVOCC license.

Since NVOCC’s are able to act as a carrier, they can issue their own House Bills of Lading (HBL). This gives both the NVOCC and their customers the advantage of time-efficiency, leaving one-less step in the process of getting your cargo from its starting point end point. NVOCC’s give you more flexibility with rates. Much of this has to do with the established networks and relationships maintained by NVOCC’s who are often able to get fixed, or low rates on batches of shipments. Utilizing an NVOCC for this purpose can reduce your costs. In addition to this, since an NVOCC operates with both the benefits of a freight forwarder and a carrier, your cargo can get from its origin to destination without the interruptions caused by working with another carrier.