Freight is the payment established by the agreement on the cargo delivery. On a practical level, in a sphere of the international deliveries, freight is a place on the aircraft, watercraft, land transportation or transportation itself, required to ship the cargo by the shipping carrier to the delivery address.
The word “freight” implies “the transported cargo in a leased vehicle”. With a more extensive consideration of the freight concept, it can be noted that this is an official interaction between the logistic company and the customer. Based on the agreement, the client must receive their cargo in a timely manner and the carrier must comply with the delivery time frames.
Dead freight is the aspect that requires your attention as well. This definition is used in sea freight in case of the vessel being underloaded. In other words, dead freight is a fee or a payment amount that is done by a freight forwarder of the cargo for the remaining free space on board that has been previously booked.
Payment for the shipped cargo is carried out when all obligations described in the agreement are met. This means that the payment is made in the event of a successful receipt of the cargo in the right amount, in full integrity and safety at the destination. Depending on the terms of the agreement, delivery and insurance fees are paid by the customer in advance, that is, before the service is completed in the required amount.
While on the topic of insurance, it is worth mentioning that the client additionally pays the insurance premium against any risks that may be associated with the shipping. The logistic company also participates in insurance and assumes the obligation to pay out the agreed compensation in the event of unforeseen circumstances, for instance: loss, damage to the cargo upon delivery.
An individual signing an agreement for the cargo shipment is called a Charterer. The owner of the transport for the cargo shipment is a Charteree. The obligations related to timely and safe delivery can be undertaken by any individual. Various types of transportation are used for this purpose.
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• The freight price is directly related to the length of the route used to ship the cargo. The cost can be significantly higher if the route passes along the border of hostilities. Changes in the price range may also depend on current valid rates, loading and unloading works performed from a warehouse or at the place of arrival included.
• The charging rates will be higher if the cargo is transported by sea and passes through the Bosporus and Panama straits. This is due to the fact that the duties are paid when passing through such a route. The price increase when passing through other straits or channels where it is required to pay an additional amount should be considered.
• The charging rate raises higher in case of shipping dangerous, non-standard, oversized cargo. The price of freight depends on the weight, stability or one-time use of this transportation service. The charging rate is also affected by seasonal changes. It should be noted, that the freight of a standard container costs much cheaper, since loading and unloading works are carried out more efficiently and a simple installation of the container on an airplane, car or train is carried out. In addition, container insurance will cost cheaper.
• To conclude with, it is worth mentioning that the freight is carried out based on the agreement or the international law. At the same time, the Charteree undertakes obligations for the quality and prompt shipment of the freight of the Charterer for a certain remuneration. This includes transport provision or booking a place there.
• The Charterer ships the cargo and pays for shipment services. A logistic company can offer one-time or regular transportation for the required number of trips. It is possible to use more than 1-2 types of transport from one or several Charterees for the transportation.
• The freight price range depends on the multiple criteria that need to be considered during the first stage of the developed transportation schedule.
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