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Customs Broker vs Freight Forwarder: What’s the Difference?

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Customs brokers work on behalf of importers to ensure that your shipments are able to clear U.S. Customs. Freight forwarders work on behalf of shippers to arrange the travel and logistics of goods. Learn more about which service best suits your shipping and import needs.
By
Jacob Lee
January 3, 2022
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Last Modified: June 24, 2022

Customs brokers and freight forwards are just two of countless services available to help walk you through the import/export process and get your goods from Point A to Point B. Two of these services are customs brokers and freight forwarders.  While these two professions share many similarities, the services they can offer you are different.

Customs brokers work on behalf of importers to ensure that your shipments are legal, compliant and able to clear U.S. Customs. Freight forwarders work on behalf of shippers to arrange the travel and logistics of shipments.  It’s critical that you determine which service works best for you to fulfill your shipping needs.

In this guide, we will provide you with further details about customs brokers vs freight forwarders and how each can help you with your shipping needs.

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What is a Customs Broker?

Customs brokers can come in many different forms. Some are private individuals that work for themselves. Others work for associations or corporations that have teams of customs brokers.

A customs broker's main purpose is preparing and clearing a customs entry. This involves carefully working with an importer to ensure that all goods within a shipment are legal and compliant with U.S. Customs. 

They receive training and are certified by Customs and Border Protection (CBP) in order to perform these duties. As a result, they are well informed about the import/export process. Some of their areas of expertise include:

  • Entry Procedures
  • Admissibility Requirements
  • Classification
  • Valuation
  • Duty Rates and other Applicable Taxes and Fees

Additionally, customs brokers can help make sure that the appropriate payment of duties and taxes are completed and sent to the CBP. 

While all imports and exports go through the CBP, there are a number of other government agencies that can become involved in the import/export process when products they regulate are entered into or out of the country. 

Filling out government paperwork about imports and exports can be difficult and time-consuming, especially when additional agencies are involved. Customs brokers take on the responsibility of staying up to date on regulations and filling out paperwork so you don’t have to.

What is a Freight Forwarder?

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Freight forwarders are firms that work on behalf of shippers to arrange the travel and logistics of cargo from one destination to another. Freight forwarders provide many other types of supply chain services. Among them are:

  • Booking Cargo Space
  • Negotiating Freight Charges
  • Cargo Insurance
  • Filing Insurance Claims
  • Tracking Inland Transportation
  • Preparing Shipping Documents
  • Freight Consolidation

While a freight forwarder is responsible for making sure your shipments arrive in an appropriate time frame, they don’t move the freight themselves. Instead, freight forwarders enlist the help of actual transportation companies. 

Freight forwarders have established relationships with various transportation companies which allow them to negotiate beneficial prices and efficient routes.

What’s the Difference Between a Customs Broker vs Freight Forwarder?

Customs brokers and freight forwarders have many similarities and differences. One way that both professions are similar is that they deal with import/export documentation and government regulations. The reason they are concerned with these subjects is how they differ, however. 

A customs broker is concerned about these subjects because their whole duty is to make sure that their client's imports and exports are cleared at the port of entry. They do this by submitting documents that show the importer/exporters' goods comply with government regulations. 

Freight forwarders are concerned about documentation and government regulations because they focus on the actual movement of goods. Proper documentation and adherence to regulations mean that the freight forwarder will be able to move the goods in a timely manner.

Another similarity is that both customs brokers vs freight forwarders act as middlemen for their clients and other parties. However, their difference is the parties they connect their clients to. Customs brokers are middlemen for their clients and the CBP. Freight forwarders, on the other hand, are middlemen between their clients and transportation companies.

The scope of services that each profession performs is different as well. Customs brokers focus exclusively on making sure importers and exporters meet government regulations. Freight forwarders focus on numerous aspects of the shipping process. 

Another difference between the two is that freight forwarders are much more common than custom brokers. According to data from IBIS World and the U.S. Bureau of Labor Statistics there are 106,900 freight forwarders and 13,000 customs brokers.

That means there are 93,900 more freight forwarders than customs brokers.

Difference in Freight Forwarders vs Customs Brokers

Freight Forwarder106,900
Customs Brokers13,000
How Many More Freight Forwarders93,900

Lastly, customs brokers are only concerned with one part of the journey while freight forwarders are concerned about a shipment in its entirety. Customs brokers generally concern themselves with goods that enter and leave the U.S. border. Freight forwarders have to plan the logistics of the entire route that goods will travel. 

Which One Should I Use?

Customs broker vs freight forwarder - A man with his hand to his chin thinking of something

Now that you know the difference between a customs broker and a freight forwarder, it’s important to determine which one you should use and when. Knowing which situation calls for a specific service is important so you don’t waste time and money.

When Should You Use a Customs Broker?

Navigating through the various rules and regulations of the CBP is extremely difficult. Rules are constantly changing and attempting to keep track of it all can be extremely exhausting. On top of that, you have to make sure that any documentation for your imports or exports is completed correctly and submitted on time.  

Most importers and exporters simply do not have the time or expertise to keep up with these regulations. Partnering with a customs broker can give you the flexibility and peace of mind that your imports will be performed correctly every time. 

When Should You Use a Freight Forwarder?

When you need to find a fast and cost-effective method of shipping your goods, you should turn to a freight forwarder. The fact is that most people don’t have the logistical skills needed to plot out a course for their shipped goods. 

Using their skills and connections, a freight forwarder can negotiate the best path for your goods. Unless you already have the best route for your goods to travel, it's a good idea to contact a freight forwarder. 

Work With a Customs Broker From USA Customs Clearance

If it's a customs broker that you need then look no further than USA Customs Clearance. Our team of Licensed Customs Brokers has more than 100 years' worth of combined experience. You can rely on our skilled team to guide you through every step of the import/export process.

Furthermore, we can help you obtain important paperwork when you need it. If you have an import with a value of $2,500 or more, we can help you obtain a customs bond. Or, we can help you become a registered importer with the CBP.

No matter what import-related questions you have or what type of help you need, you can contact our team and get help getting started today.

Need the Help of a Licensed Customs Broker?

Get the help you need to import your goods hassle-free

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