Freight forwarding can be a complex world, especially when you’re trying to decode the industry’s seemingly endless stream of acronyms and technical terms. Whether you’re an importer, exporter or simply looking to understand your logistics partner a little better, knowing the language of freight forwarding can save time, reduce confusion, and help you make more informed decisions.
At Think Global Logistics, we believe in making global trade easier, not harder. So, we’ve pulled together this jargon buster to help demystify some of the most common freight forwarding terms you’re likely to come across.
1. Freight Forwarder
Let’s start with the basics. A freight forwarder is a company (like us!) that organises shipments for individuals or businesses. We handle everything from booking cargo space, arranging documentation, to coordinating transportation across air, sea, and land.
2. Bill of Lading (BOL or B/L)
This is a legal document between the shipper and the carrier. It outlines the type, quantity and destination of goods being shipped. It’s also a receipt and sometimes serves as a document of title – meaning whoever holds it legally owns the goods.
3. FCL and LCL
- FCL (Full Container Load) means your goods fill an entire shipping container.
- LCL (Less than Container Load) refers to when your goods share container space with other shipments. It’s more cost-effective for smaller loads, but transit time can be slightly longer.
4. Incoterms
Short for International Commercial Terms, Incoterms define the responsibilities of buyers and sellers in international trade – including who handles shipping, insurance, customs clearance and more. Common ones include:
- FOB (Free on Board) – The seller delivers goods on board the vessel; the buyer takes over from there.
- CIF (Cost, Insurance, Freight) – The seller pays for everything up to the port of destination.
- EXW (Ex Works) – The buyer handles everything from the seller’s door onwards.
5. HS Code (Harmonised System Code)
This is a globally standardised number used to classify traded products. Customs authorities use it to determine duties, taxes, and regulations. It’s crucial that your HS code is accurate, or you might face delays or penalties.
6. Customs Clearance
Customs clearance is a process where customs authorities inspect and approve your goods for import or export. In addition, it involves the submission of documents such as invoices, HS codes, and permits. As a result, we handle the entire process as your forwarder to ensure a smooth transition across borders.
7. Demurrage and Detention
These are two fees you want to avoid:
- Demurrage: A charge for leaving a container at the port longer than the free time allowed.
- Detention: A fee for keeping the container outside the port (e.g., at your warehouse) beyond the allowed period.
At TGL, we help you plan to avoid these unnecessary costs.
8. ETA / ETD
- ETA (Estimated Time of Arrival) – When the ship or cargo is expected to reach its destination.
- ETD (Estimated Time of Departure) – When it’s expected to leave the origin point. Keep in mind these are estimates – weather, port congestion and customs delays can affect them.
9. AWB (Air Waybill)
Similar to the Bill of Lading, but for air freight. It’s a document that accompanies goods shipped by air and provides detailed information about the shipment and its journey.
10. 3PL (Third-Party Logistics)
A logistics provider that manages part or all of your supply chain services operates as a 3PL. Specifically, this includes warehousing, transport, inventory management, and freight forwarding. Moreover, Think Global Logistics is a full-service 3PL that offers tailored solutions to meet your business needs.
11. Packing List & Commercial Invoice
These are essential documents in international freight:
- Packing List: Lists what’s in each package – quantity, weight, dimensions, etc.
- Commercial Invoice: A bill for the goods being sold, used by customs to assess duties and taxes.
12. Cargo Insurance
While not mandatory, we always recommend it. Cargo insurance protects your goods from damage, loss, or theft during transit. Without it, you could be liable for significant costs if something goes wrong.
13. Quarantine / AQIS
Australia has strict quarantine laws. The Australian Quarantine and Inspection Service (AQIS) inspects goods entering the country to ensure they don’t pose a biosecurity risk. Failing to comply can lead to delays, fines, or destruction of goods.
14. Port of Loading / Port of Discharge
- Port of Loading (POL): Where your goods are loaded onto the vessel.
- Port of Discharge (POD): Where they’re unloaded. Sometimes you’ll hear “origin port” and “destination port” instead.
15. Manifest
A detailed list of all cargo on board a ship or plane. It’s submitted to customs and includes important details about each shipment.
Conclusion
Navigating the world of freight forwarding doesn’t have to feel like learning a new language. With this glossary in your back pocket – and Think Global Logistics by your side – you can approach your next shipment with clarity and confidence.
If you’re ever unsure about a term or process, just ask us. We’re here to simplify shipping, not complicate it. That’s the TGL way – smart, seamless, and customer-first.
Need a trusted freight partner who speaks your language?
Contact Think Global Logistics today for personalised service and expert support.