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September 18, 2017 at 7:33 AM

Co-loading is a term used in export and import trade especially in the area of freight forwarding. What is co loading? How does Co loading work? Is there any advantage in Co loading? What are the demerits in Co loading?

 

The term co-loading means transferring cargo by a freight forwarder to another carrier either to a freight forwarder or consolidator. Co-loading is a common procedure in import-export trade especially for less containerload – LCL - transactions. The carrier who co-loads the cargo is called co-loader.

 

Co-loading with more than two freight forwarders is not a good practice as the destination delivery order charges and the formalities make shippers and consignees more complicated rather than monitory loss under destination delivery charges.

 

For example, if A accepts cargo from X and co-loads the cargo with B. B again transfer goods to C a main carrier of goods. At destination port, Z who is the representative of C delivers cargo to Y who is the representative of B at load port. At destination port, Z collects Delivery Order Charges from Y, Y collects Delivery Order Charges from X and in turn, X collects Delivery Order Charges from Y.

 

Is there any advantage in Co loading?

Freight under co loading could be cheaper, as some of the co-loaders have competitive freight rates to various locations. The cost of carriage could be lower if moved through a co loader. However, such advantage has to be balanced with the destination delivery charges and other inconvenience, if more than one co loader is involved.

 

source: www.howtoexportimport.com