Getting it right when budgeting for freight forwarding projects

Our experience tells us that getting the figures wrong on a freight forwarding quote can quite simply, make or break a business. That’s why we stand by our quote, and only about 2% of the time do we make any variations, even when the market has fluctuated substantially.

Does this mean that we sometimes take a hit? Of course, but we always have our clients and long term relationships in mind. So if you’re finding the ‘lowest quote’ has hidden additions, and blows your budget, read on.

We have experience with complex and large shipping projects as well as everyday freight forwarding. Transporting cargo for major projects such as Oil and Gas stations and moving heavy mining equipment across the world, is a specialty field. It requires thorough planning from the very beginning.

So when clients say …

‘Keep the costs down, can we get a better price?… but we didn’t think it would cost that much, you’re too expensive’…

We know that we have given a thorough quote, door to door, with no hidden extras.

Understanding Freight Forwarding – Price versus Cost

When budgeting for your shipments, remember that there is a vital difference between ‘Price’ and ‘Cost’. Understanding this can result in success or failure of your project. It’s that simple.

Forecasting Freight forwarding costs

  • Talk to the experts first – TGI  Cargo knows the key things you need to do to forecast costs accurately – from correct measurements of the cargo to be shipped, to knowing the local laws that apply. A planning price today is not the same as the one you find applies when the shipment is executed 2 or more months later.
  • Understanding Volumetric Leverage It’s no good getting a quote from a freight forwarder who ships small cargo to major city ports, when you have multiple containers going to site in mountainous terrain, during a wet season. There is a volume at play that can mean you have leverage for a better price, or another route might be more cost effective.
  • At TGI Cargo we will take the time to work with you on your quote, even before you have booked us for your project.
  • Get the fine details and measurements right – TGI Cargo takes the time to get every detail and correct measurement from you, before the project starts, to ensure successful transport of your cargo and to save on costly delays. Our experience allows us to foresee problems before your freight even leaves the ground.

We’ve heard and seen it all… a 7 metre high piece of equipment that needed to be freighted, but was assembled in a factory in China, with a gate measuring only 5 metres! And a company who was quoted to transport multiple planes that did not actually fit through the door of the transport aircraft! Costly mistakes that could have been avoided!

In fact, we know of a recent project where costs blew out by $2 million, because the project manager misinterpreted the dimensions of their shipment. Our quote was accurate, but they went with something lower, and then got hit with a massive bill far higher than that quote.

  • Price should never be your governing factor – At TGI Cargo we know the difference between ‘Price’ and ‘Cost’.

We often hear – ‘Pete can you sharpen the pencil on that?’

Any price can be put out there to win a job, but what will it cost you when measurements or weights are incorrect? When undersized equipment has been booked to transport your freight, or when your shipment exceeds the legal size transportable at your destination?

It’s a bit of a dirty trick that happens in our industry, because once you commit to a forwarder, they have your freight until you complete payment to release it. We don’t offer the lowest quote in every instance, because the result is just not what you wanted.

  • What is safe and on time delivery worth for your shipment? 

We find that the lowest price can mean compromise, where you may not get the service you need, or may incur overrun costs. I’ve even seen a $20,000 custom made item arrive bent in half, because someone went with a cheaper quote. Back to Germany and a 6 week delay they went … and did insurance cover it? NO.

You want to compare apples with apples.

So when you compare quotes, look at every aspect, and don’t be afraid to share your quotes with your forwarder, to ensure all line items match up.

Choosing a professional freight forwarder

  • Ask for a capability study and ask questions.

Have they moved similar cargo or done a project of this size before?

Do they have a case study?

Are they insured and qualified?

  • Should I choose airfreight, sea freight or road freight? 

At TGI Group we will advise the most cost effective type of transport according to your project’s needs, cargo weights, timeline, and budget. That means options – so that you can choose between speed and budget freight forwarding options.

What information do they need from me to get an accurate quote? 

  • A packing list with all dimensions and weights
  • For project cargo – drawings and technical data
  • Load point and destination point
  • Advise the forwarder what portion of the project they will be handling – is it the entire project or just the road transport section?

Comprehensive Freight Forwarding Quote Elements 

A good cargo company will give you the following to give you the most accurate estimate:

  • A full end-to-end supply quotation
  • Timelines
  • Method statements
  • Line items on every stage
    • Port and load fees
    • Truck, air and ocean fees
    • Customs and duty
    • Special equipment
    • Insurance and tracking
    • QHSE – quality, health, safety and environment considerations

At TGI Group, our job is to help you to run a successful project and it starts with good planning and accurate budgeting. End to end, safe, 24/7 handling and a 100% delivery record is our commitment to all our clients.

To discuss your budget or for advice on the most effective cargo scheduling for your next major project contact TGI Group.



Written by TGI Cargo

23 February 2021

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