Recently a client asked us to investigate the charges they had received from another freight company. Previously this client had used our services but had been presented with rates that appeared to be very competitive.

The Background

The client does buyer consolidations (BCN) shipments, where we collect goods from multiple suppliers in Europe and consolidate them in our partners store in Rotterdam. We then work out the most cost effective method of shipping products to New Zealand as they need them, and according to the projects they have on the go. We have multiple tools in our arsenal for this, including air freight, economy air freight, air / sea (we can fly the goods to a major hub in Asia and then sea to Auckland which saves about 3 – 4 weeks on the transit), premium sea freight and economy sea freight. We have very open dialogues with the client on this and keep the communication transparent.

The Story

This very large European freight company received the stock into their store ok, but with very little (and very confusing) communication with the client they shipped 23 cubic meters of product in a 40′ container. To put this into perspective we generally expect to get 28 cubic meters into a 20′ container, and up to 60 cubic meters into a 40′ container. They then shipped the goods on an economy sea freight service to Auckland. We remeasured and double checked the configuration of the freight and there would have been no issues loading in to a 20′ container. All product was loaded onto pallets so loading into a container would be straight forward.

On arrival into Auckland the Auckland office of this freight company invoiced the client at the premium 40′ sea freight rate (effectively doubling the cost of the shipment) and denied all responsibilities around having only a partly loaded container, lack of communication and not advising the client of the additional costs involved. The freight company still had control of the shipment so our poor friend had no access to his stock to even sell on and begin to cover the extra costs.

After two months of trying to negotiate a favorable outcome they asked NZ Freight to kindly to look into this for them. We read through all the correspondence and made note of the above points to them, and requested we reach some common ground and move on. They responded by saying that they had charged the 20′ rate even though the goods moved in a 40′ (this would mean that their 20′ rate is about 3 x the market rate) and threatened to get their “corporate lawyers involved”.

Wow! It is fair to say our friends have learnt their lesson!

In Conclusion

So in wrapping up the moral of the story is that bigger isn’t always better, at least when it comes to freight companies. Our advice is to work with some one local that really does have your best interests at heart, and are not just trying to fit your shipments into their corporate machine. Sometimes there is value that isn’t reflected in a nicely packaged quote.