Freight is a concept well known by international transport and logistics companies. It is also a term that individuals who want to send international cargo must master. Because, freight determines the cost of the cargo to be transported.

While calculating freight, points such as the weight of the cargo, the distance of the place to be transported, and the mode of transportation are taken into consideration. Freight is the shipping fee required for the international transport of your cargo. You must pay the determined freight amount in order to benefit from the services when delivering your shipment.

What Does Freight Mean?

Before moving on to the details regarding freight, it is necessary to know the answer to the question 'What is freight?'. According to the TDK (Turkish Language Association), freight is defined as the fee charged per cargo by cargo-carrying vessels. As transportation fields and the sector have developed over time, the term freight has also begun to be used in road, air, and rail transportation. In response to the question of what freight means, it can be briefly described as the 'shipping cost in international transportation'.

What is the Freight Charge?

The freight charge can be paid either at the port of destination or as cash in advance. Some of the prominent factors determining the freight charge are as follows:

• The weight of the cargo, the volume it occupies, its mode of transportation

• Relations or special agreements between the company that will have the cargo transported and the carrier company

• Transportation duration

• The distance between the departure point of the cargo and its destination

• Whether the transport vehicle is empty or loaded when returning from the destination point

Since it has multiple variables, it is not possible to state a definitive amount for the freight charge.

What is a Freight Invoice?

A freight invoice is a document showing the fee charged for the freight payment made in the transportations carried out. It is one of the important elements required for the taxation procedures of cargo or goods going to countries. The authority to issue a freight invoice has been given to international transportation companies. With this invoice, it is proven that there is no outstanding debt.

There are two types of freight invoices: certified and domestic. The certified invoice can also be called a consular invoice. The reason for this is that in cases of import, the original invoices shown to customs are required to be certified by the consulates of the relevant country. Some of the information that must be fully present in the domestic invoice is as follows:

• The statement of Turkish origin of the goods

• Total weight of the cargo

• Mode of payment

• Delivery term

• Contact information such as the name and address of the exporter

• Names of intermediary banks

What is a Freight Contract?

A freight contract is a transport contract that determines the obligations of the carrier and the counterparty. The responsibilities of both parties are included in the contract made. For a freight contract to be valid, the characteristics it must bear are as follows:

• The determined freight charge must be paid in return for the transport.

• The party that will transport the cargo must not take ownership of the cargo or goods to be transported.

• There must be a party to transport the cargo.

The information that should be included in the freight contract can be listed as follows:

• Type of goods to be transported

• Number of pieces of cargo

• Form of payment

• Contact details of the person having the cargo transported

• Departure and destination points of the vehicle conducting the transport

• Date on which the contract was made

• Mode of transport

• It should contain information such as the delivery term to be applied.

The cancellation of freight contracts can be subject to cases such as state of war and the seizure of the transport vehicle by the state. Furthermore, freight contracts are divided into two types: Charter Party and General Cargo Freight Contract:

Charter Party Contract: What is important for this contract is not the cargo to be transported, but the vehicle carrying the cargo. Whether the charter of the vehicle will be full or partial is documented by the contract made. If it is to be fully chartered, it is called a full charter; if it is to be partially chartered, it is called a partial charter.

General Cargo Freight Contract: There is no chartering involved in these contracts. It is a contract directly made on the transportation of cargo from one place to another.

What is the Freight Market?

The freight market is shaped according to the distance between the departure and destination points of the cargo, the space to be chartered on the transport vehicle, the responsibilities in the contract clauses of the shipping companies, and the demands of the customer.

What is Freight Insurance?

Freight insurance is a type of contract covering the liability of the shipping company in case of damage to the clients' goods during transportation. While calculating the insurance, the packaging, type, mode of transportation, scope of coverage of the goods, and the transport vehicle are influential.

In order for the damage to the goods to be considered within the insurance scope, negligence of the shipping company carrying out the transport must be involved. Freight insurance is determined by calculating it as a percentage of the shipping broker's fees. The shipping company can pay the determined or to-be-determined insurance costs. If it does, it adds it to the service fee provided to the client.

What is Freight Tax?

Freight tax in Turkey is a tax levied for import and export transport operations carried out within the Turkish Customs Territory. Freight tax can be collected during domestic or international transport activities and is usually determined according to the weight of the cargo, distance, and transport method.

Freight tax is collected according to the tariffs determined by the Ministry of Customs and Trade of the Republic of Turkey. These tariffs are renewed every year and are used in calculating freight charges. Freight tax is a fee collected by the carrier from the cargo owner and must be paid for the successful completion of the transport operation.

How to Calculate Freight?

There are some points that are effective when calculating freight and vary depending on the cargo. Some of these points are as follows:

• If the provided cargo does not fill the inside of the container, weight and volume calculation is important. When weight and volume are compared, the calculation is made based on whichever value turns out higher.

• The type of container is influential on the calculation. For example, the cost of a 40ft container is higher compared to a 20ft container.

• The functioning of the lines is one of the important factors. Affordable rates are encountered on busy lines.

• The distance of the country where the goods will be sent is an important determinant when calculating freight.

At Which Stages of Cargo Transportation Processes Do We Encounter Freight?

Freight appears in several stages during cargo transportation processes:

• Cargo Pricing

• Freight Payment

• Cargo Collection

• Cargo Transportation

• Cargo Delivery

These stages are the primary phases where freight is encountered in the cargo transportation process. However, because each cargo transport operation is different, there may also be additional stages in some cases.

What are the Types of Freight?

Freight types can be grouped under 3 headings:

• Lump-Sum Freight: It is the fixed fee paid for renting the space of the ship where the cargo will be placed. Whether the chartered space is filled or not, the freight is paid to the transport company as agreed.

• Ad Valorem Freight: It is the freight charged based on the sales value of the cargo. It has a specific percentage. This type is generally used for cargo of high value.

• Dead Freight: It is the freight loss resulting from the short loading of the cargo declared by the shipper. The party causing this pays the freight loss to the company as compensation.

Although freight emerged first for maritime transportation, transport activities developing over time have also led to an expansion in the usage of freight. Depending on characteristics such as the features of the product to be sent and the mode of transportation, different freight options are available to bring the goods to the point they need to reach. The freight types you will benefit from to deliver your shipments are as follows:

• Air Freight

• Road Freight

• Sea Freight

• Rail Freight

• Less than Truckload (LTL) Road Freight

• Less than Container Load (LCL) Sea Freight

How to Get a Freight Quote?

The freight rate is determined at different prices according to the vessel equipment and carrying capacity. Therefore, vessels may have a different freight price for cargo of the same dimensions. While a much more affordable price is obtained for light cargo with the same volume, this situation may vary.

Sea Freight Calculation

Vessel freight rates are quite affordable. The widespread use of ship transportation is the most important reason for price drops. The price varies according to the vessel, the product to be transported, and user demand. The customs process is as important in sea transportation as it is in air and road transportation. Meticulousness is at the forefront in sea transportation because transportation is carried out in high tonnage and quantities.

Air Freight Calculation

Companies must first calculate the volumetric weight. Weight and volumetric weight take an important place in determining and calculating the freight price in the most accurate way. After the volumetric weight is determined and it is investigated whether the product to be transported is suitable for transport, companies present affordable price quotes.

Road Freight Calculation

Due to its flexibility and vast coverage areas, road transport is a frequently preferred type of transport. While calculating freight, full truckload and partial truckload transportation are examined independently. Full truckload is calculated based on distance and market conditions. In partial cargo transportation, the weight to be applied in freight pricing is calculated after the volumetric weight of the cargo is determined.

Which Factors Benefit Freight in Transport Costs?

• Different transportation modes such as sea, air, road, and rail are important factors affecting freight costs.

• The quantity and weight of the cargo transported is a factor that directly affects freight costs. Generally, as the quantity and weight of cargo increase, the freight cost also increases.

• The size of the cargo can also affect freight costs. Large and bulky cargoes may cause higher freight costs as they occupy more space in transport vehicles.

• Transportation distance is an important factor in determining freight costs.

• Urgent shipments and express deliveries are associated with higher freight costs. Costs may increase when priority services are requested.

• Different delivery points such as door-to-door, port-to-port, and terminal-to-terminal can affect freight costs.

• Fuel costs used in transportation are an important factor affecting freight costs. Changes in fuel prices are also reflected in freight costs.

• Customs processes and taxation procedures of the cargo can affect freight costs.

• Insurance costs can also affect freight costs, depending on the risks in the transportation process.

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