Getting your product to your customer on time, in good condition and at a reasonable cost is very important to any export transaction. Transportation can account for a significant proportion of the cost of any export order so spend some time choosing the most efficient method of dispatching your particular consignment.
Factors which should influence your choice include frequency of shipment, total transit time and of course the total distribution costs involved.
The latter point is very important. Air-freight cost for instance may seem at first sight to be disproportionately high when compared with sea-freight rates for the same consignment. However by using air-freight you may be able to cut down on packaging, warehousing materials, handling, etc. So costs from point of origin to ultimate destination must be assessed together before you can obtain a true picture of relative distribution costs.
Irish exporters have three main options for moving goods:
1. Air Freight
Widely used for perishable goods (e.g. foodstuffs), periodicals, fashion products, fragile goods (e.g. electronic equipment), urgent goods (e.g. spare parts).
2. Sea Freight
Used for the vast bulk for our exports. Nowadays usually containerised either on a full load basis or groupage, where two or more consignments are grouped in a container.
3. Express Trailers
Driver-accompanied trucks, which load in Dublin or other centres around the country or at your own premises and unload in the town or destination or in the customer's premises. This system is taking an increasing share of Irish exports.
Other options include parcel post, which is appropriate for small consignments/samples and also international couriers.
In most cases, geography, availability of services and the product's physical characteristics are factors which influence the exporter in choosing a transportation system.
Freight Forwarders
Freight forwarders are essentially agents for carriers of all kinds. They will assess transport problems and make recommendations concerning the best method of shipment and the appropriate packing. They will then obtain quotations from carriers specialising in the destination and type of transport that is required.
The freight forwarder can be particularly valuable to Irish exporters in helping with the sometimes very complex documentation requirements of the countries to which you are shipping. It should be stressed that this service is also available from the carriers themselves if you decide to deal directly with them.
Freight forwarders earn their income from the services they supply direct (such as collection and documentation) and from commission paid by carriers. Far from being more expensive than dealing directly with carriers, they can often save you money as a result of their specialised knowledge and consequent ability to recommend the most suitable method and route.
Transit Insurance
It is important that all export consignments are fully covered by insurance from the time they leave the manufacturer's premises until they arrive at the buyer's premises.
The responsibility for insuring goods in transit may rest with either the buyer or the exporter, depending on the terms of sale. Where goods are sold on a CIF basis (cost, insurance & freight), insurance is clearly the responsibility of the seller. On the other hand, if goods are sold on a C&F basis (cost & freight), insurance costs are not included in the selling price.
Prospective exporters should examine the terms of sale carefully and ensure that the goods are adequately insured for the full transit, i.e. from factory to customer's premises. You should seek the advice of an insurance broker.
The usual form of transit insurance is a marine policy. In addition to providing cover for the goods while at sea, the insurance can be extended to cover the goods while moving on land, e.g. by road or rail.