The logistics industry relies on various players working together to ensure goods move efficiently across the globe. Among these are NVOCCs (Non-Vessel Operating Common Carriers) and freight forwarders, each serving a distinct purpose.
Understanding the roles and differences between these entities is crucial for businesses to make informed shipping decisions, save costs, and streamline their supply chains.
Per the report by Contimod, the global logistics market was valued at $8.96 trillion in 2023 and is projected to grow to $15.79 trillion by 2028, reflecting a compound annual growth rate (CAGR) of 6.3% between 2023 and 2028.
The logistics industry is a core unit of global commerce, facilitating the efficient movement of goods across borders and continents.
Who is an NVOCC?
An NVOCC (Non-Vessel Operating Common Carrier) is a company that acts as a carrier by issuing its bills of lading but does not own or operate the ships that transport the cargo. Instead, NVOCCs lease space on vessels from shipping lines and sell this space to shippers.
They play a key role in the logistics chain by consolidating smaller shipments from multiple customers into full container loads, offering competitive rates and flexible services. NVOCCs are particularly valuable for businesses without the volume or expertise to negotiate directly with large shipping lines.
What are the Benefits of Working with an NVOCC?
The benefits of working with an NVOCC (Non-Vessel Operating Common Carrier) include:
- Flexible Shipping Options: NVOCCs consolidate smaller shipments, making it easier for businesses with limited cargo to access competitive shipping rates.
- Cost-Effectiveness: They negotiate bulk space with carriers, passing cost savings to customers.
- Simplified Process: NVOCCs handle complex documentation and logistics, reducing the administrative burden for shippers. With solutions like Vizion, they can streamline tracking and improve communication.
- Global Reach: Many NVOCCs have extensive networks, enabling efficient international shipping solutions.
- Customized Solutions: They tailor services like route planning and transit schedules to meet specific business needs. They are often supported by advanced tracking and analytics tools such as Vizion to ensure reliability and efficiency.
Who are Freight Forwarders?
Freight forwarders are logistics experts who act as intermediaries between shippers and carriers, managing the transportation of goods from origin to destination. They do not own ships, planes, or trucks but coordinate various elements of the supply chain, including shipping, customs clearance, warehousing, and documentation.
Freight forwarders often use advanced tools like Vizion to provide real-time shipment tracking and enhance supply chain visibility. Such technology ensures that goods reach their destination efficiently, allowing businesses to stay informed about their shipments at every step of the journey.
Benefits of Onboarding Freight Forwarders
The benefits of working with freight forwarders include:
- Expertise in Logistics: Freight forwarders bring deep knowledge of shipping routes, customs regulations, and international laws, ensuring efficient handling of the entire shipping process.
- Simplified Process: They manage all aspects of the shipping process, including booking cargo, arranging transportation, and handling documentation, saving businesses time and effort.
- Cost Savings: By consolidating shipments and leveraging their network, freight forwarders can negotiate better rates and reduce overall shipping costs.
- Global Reach: Freight forwarders often have a worldwide network of contacts, which allows businesses to ship goods across borders and into remote areas that might be difficult to access.
- Supply Chain Visibility: Many freight forwarders use tools like Vizion to offer real-time tracking and shipment visibility, enabling businesses to monitor goods and manage any potential issues proactively.
NVOCC vs. Freight Forwarders: Detailed Comparison
In the logistics industry, NVOCCs and freight forwarders each play distinct roles, though both are involved in the movement of goods across the globe.
Understanding their differences is key for businesses to choose the right partners for their shipping needs. While NVOCCs provide services similar to carriers without owning vessels, freight forwarders act as intermediaries who manage all aspects of the shipping process.
The table below highlights the core differences of each:
Conclusion
Understanding the roles of NVOCC and freight forwarders is essential for businesses today to make informed decisions that optimize shipping efficiency and reduce costs.
Solutions like Vizion can further enhance these roles by providing real-time tracking and visibility, ensuring smoother operations, and reducing the risk of delays. Choosing the right partner, combined with advanced tracking technology, ensures that your business stays ahead in the competitive global market.
Book a demo with Vizion to access all of their best API-based solutions:
- Real-Time Container Tracking: Gain access to the most complete, standardized, and detailed container tracking events via API or user interface with real-time container tracking data.
- TradeView: Monitor the live flow of any company's shipments 30 to 90 days before arrival at the destination and analyze trends across 10 years of historical supplier, product, and logistics movement data. With 900 million shipment records, 140+ attributes per shipment, coverage spanning 190 countries, and comprehensive HS code data, TradeView empowers data-driven decisions that optimize global trade management.
- Logistics Performance Hub: Access a comprehensive suite of global logistics datasets, including Port Performance, Port Activity, and Port Pairs, to analyze shipping trends, port throughput, container dwell times, and real-time port activity, enabling smarter decision-making about containerized freight movements.
