What is Sea Freight and Why Use It?

What is Sea Freight? 

Sea Freight is a method of transporting large amounts of goods using carrier ships. Goods are packed into containers and then loaded onto a vessel. A typical cargo ship can carry around 18,000 containers, which means that sea freight is a cost-efficient way to transport high quantities over large distances.

Who Uses Sea Freight?

Sea freight is often used by people importing from China or anywhere else in the world. For people buying their stock overseas (and therefore bulk goods), sea freight shipping is usually the cheapest shipping method. If you’re importing a bulk amount of goods, sea freight could be the most cost-efficient option for you.

How Long Does Sea Freight Take?

There are multiple factors to consider when explaining the time sea freight takes. Firstly, the time spent on water and the time shipments take from door-to-door are different; due to the process of sea freight (which we will explain later in this post), there are a lot of steps the goods have to go through before they reach the vessel and then once they leave it. On top of this, the location of your goods affects the time sea freight takes. This is basic geography – some places are further away than others! Typically, there will be around a week at each end of the process on top of your time on water. For example, if you’re importing from central China, the time on water may be 30 days – but you’ll need to add two weeks onto those 30 days for customs in both countries.

Unfortunately, there can be delays in sea freight that can add time onto your shipment time. We’ve written an entire post about delays in sea freight shipping and how to avoid them. The main delays will usually occur when importers don’t have all the necessary documentation, or their goods are held up at customs. If you’re well prepared, you shouldn’t have anything to worry about! Plus, if you’re shipping with us over at Shippo, we help you get all your ducks in a row and assist with your documentation.

Sea Freight vs. Air Freight vs. Couriers

When importing to the UK, there are multiple methods of international transport that you can use. The main three are:

Couriers. Courier services are your typical door-to-door service; you’ll be familiar with many couriers such as Hermes and UPS. For small shipments.

Airfreight is when your goods are loaded onto a plane instead of a vessel. For larger quantities than couriers, but for smaller quantities than sea freight.

Sea freight. Sea freight is when your goods are loaded onto a vessel. Bulk shipments are best for this method of transport.

Each mode of transport is most efficient for different types of shipments. If you’re looking for the cheapest way to import goods, sea freight is the most cost-efficient; however, it takes the longest amount of time. Airfreight and courier services are both far quicker (usually around 3-6 days delivery time) but, due to smaller vehicles, space inside is priced at a premium, so they’re both expensive.

Incoterms

When you’re shipping via sea freight, one of the biggest things that will effect the sea freight costs you run into are what Incoterms you’re trading under. Incoterms are essentially an international trading rulebook; each term has a specific set of rules and responsibilities that each party needs to follow. This makes international trading simpler as both parties are aware of what actions they need to be taking and the language barrier isn’t an issue. Now that you know what the Incoterms are, let’s talk about how they affect your sea freight rates. On different shipping terms, you are responsible for a different amount of costs; on FOB shipping terms, it’s a roughly even split between you and your supplier, whereas on EXW terms you’re responsible for everything. If you’re shipping via CIF, your supplier is even responsible for your sea freight costs. Depending on which shipping terms your shipment is operating under, your shipping company will alter your overall sea freight rates to take the extra costs into consideration. If you’re operating under EXW shipping terms, you are responsible for more costs and will be charged more.

Sea Freight Process

We’ve mentioned the process of importing from China or other countries via sea freight in this post already – now it’s time to explain it! Depending on whether your goods are LCL or FCL, the importing process will be slightly different, but here’s a rough outline:

• You hire a shipping company (like ourselves!) and we collect the goods from your supplier.
• Your goods are cleared through their origin country’s customs.
• If your goods are LCL, they will then be loaded into a shared container. If they’re FCL, they’ll be loaded into one container.
• The containers are loaded onto the next available vessel and will be sailed round the world to you.
• Once they reach the UK, they will be processed by UK customs.
• If your goods are LCL, they’ll be unpacked from the shared container and shipped to you either as pallets or loose cartons.
• If your goods are FCL, they container will be loaded onto the back of a lorry and delivered to you, still sealed.

LCL vs FCL

There are two types of sea freight rates: LCL and FCL, each for a different type of shipment. When you import goods to the UK via sea freight shipping, goods are loaded into containers that are then loaded onto vessels for transit. Depending on the size of your shipment, you will either be able to fill an entire container with only your goods, or you may need to share a container with other people.

LCL

LCL (Less-Than-Container Load) shipments are for goods that are too small to fill an entire container. Instead of your goods being loaded into their own container, your goods are in a shared container with other people. LCL is charged by cbm (cubic meter).

FCL

FCL (Full Container Load) shipments are for goods of a high enough volume to warrant being transported in their own container. FCL is charged a flat fee per container.

• Usually, your shipping company will help advise you on whether your shipment requires LCL or FCL.
• There are a number of ways in which sea freight can be transported. 
• FCL or Full container load, in which you purchase one or more full containers to send on a ship.
• LCL or Less than container load, where your products share a container as you may not have a full container’s worth. Once they reach their destination, the container’s contents are divided once more.
• RORO or Roll on roll off, where your products do not leave the vehicle they are in to go onto the cargo ship. The vehicle simply drives onto the ship and then drives off the other end.
• Dry bulk shipping, used for some specific items, which are deposited into the hold of the ship instead of traveling in a container.

How does it work? 

Sea freight is just one cog within the machine that forms a supply chain network. Some companies opt to use a specific 3PL to have their goods shipped safely and legally. As mentioned in our Top 5 benefits of 3PL, one of the major benefits of these providers is that they already know all of the requirements and you will not have to engage with a shipping company for each item. 

Once you have engaged with a shipping company, they will collect the goods from your supplier and move them through the port in one of the previously mentioned forms. It is worth noting that delivery times should include a delay moving through the port each side as they have to pass through customs. Even with LCL as an option, you may still not have enough products, in which case it may be more cost-effective for you to send your products via Air Freight or Courier instead. These are both utilised for sending smaller quantities of products, they are more expensive as the vehicles themselves are smaller.

Benefits vs Disadvantages

Benefits 

1. Cost-effective comparatively to other methods
2. Easy to maneuver heavy or large products with ease
3. Inexpensive over long distances
4. Most Carbon-efficient solution

Disadvantages 

1. Obviously, one of the largest cons when it comes to sea freight is time, as it is the slowest option for moving products
2. The price is unsustainable for smaller amounts of goods
3. Sea freight is economically and environmentally superior to other forms of product delivery service, but only if you are looking to transport large quantities or if the destination country is far away. However, even with the option of LCL, courier services and Air Freight may still be better options depending on the product in question.

Courtesy: Best logistics company in Lahore