Air Freight: The Basics

Air freight is a crucial component of global trade, allowing businesses to transport goods quickly across vast distances. While it may seem straightforward, the process involves multiple parties and complex logistics. 

This post will walk you through the air freight process, focusing on an import scenario where a company is bringing goods into their country from an overseas supplier.

Table of Contents

Key Players in Air Freight

Before diving into the process, let’s identify the main parties involved:

  • Shipper (or Consignor).

The party sending the goods, typically the overseas supplier or manufacturer in an import situation.

  • Consignee (or Importer).

The party receiving the goods, the company importing the products.

  • Freight Forwarder.

A company that organises shipments for individuals or corporations to get goods from the manufacturer or producer to a market, customer or final point of distribution.

  • Airlines.

The carriers that physically transport the cargo by air.

Other parties often involved include: 

  • General Sales Agent (GSA): 

Represents airlines in specific countries or regions, often handling cargo sales on behalf of the airline.

  • Ground Handling Agent (GHA): 

Manages the physical handling of cargo at airports, including loading and unloading aircraft.

  • Customs Broker: 

Assists with clearing goods through customs barriers for importers and exporters.

  • Road Feeder Service (RFS) Provider: 

Offers trucking services to transport cargo to and from airports.

  • Cargo Terminal Operator (CTO): 

Manages cargo facilities at airports.

  • Customs Authorities: 

Government agencies responsible for controlling the flow of goods in and out of a country.

  • Insurance Provider:

Offers cargo insurance for the shipment.

  • Bank.

May be involved in financial transactions, especially in cases involving letters of credit.

  • Inspection Agencies. 

May be required to inspect certain types of cargo.

  • Packaging Companies.

Provide specialised packaging services for air freight.

Air Freight Process: Step-by-step

This guide outlines the air freight import process from the perspective of a company (the importer) bringing goods into their country from an overseas supplier.

In this scenario, the overseas supplier is the “shipper” or “exporter,” while the company receiving the goods is the “importer” or “consignee.” 

Let’s get into it.

Step 1: Initial Business Negotiation

The process begins when an importer identifies a need for an international product.

They contact potential suppliers, negotiating product specifications, quantities, prices, and delivery timeframes.

A critical part of this stage is agreeing on Incoterms, which define responsibilities for transportation, insurance, and customs clearance.

Step 2: Selecting Transportation Mode

After finalising the deal, the importer evaluates transportation options. Factors considered include:

    • Agreed Incoterms
    • Nature of goods
    • Urgency of delivery
    • Budget constraints

This time, air freight is often chosen for its speed and reliability, particularly for high-value or time-sensitive goods.

Step 3: Engaging a Freight Forwarder

The importer researches and evaluates forwarders based on their expertise, network coverage, pricing, and additional services before making a selection.

Step 4: Shipment Planning

The importer provides the forwarder with shipment details, including:

    • Nature of goods
    • Quantity
    • Dimensions and weight (if known)
    • Origin and destination
    • Agreed Incoterms

The forwarder then advises on:

    • Packaging requirements
    • Documentation needs
    • Customs regulations
    • Potential challenges based on route or product type

Step 5: Documentation Preparation

The supplier prepares:

    • Finalised Commercial Invoice that includes:
      • Detailed description of goods
      • Quantity and unit price
      • Total value of shipment
    • Detailed Packing List:
      • Itemised list of package contents
      • Weight and dimensions of each package
    • Certificate of Origin (if required)
      • Document certifying country of manufacture
      • Necessary for certain trade agreements or customs purposes
      • Export licenses (if applicable)
      • Dangerous Goods declaration (if applicable)
      • Letter of Credit (if applicable)
  •  

Step 6: Cargo Preparation and Packing

The supplier packs the goods according to the selected packing method:

    • Individual boxes
    • Palletised cargo
    • Unit Load Devices (ULDs) 

They measure and weigh the packed cargo.

The freight forwarder calculates the chargeable weight:

    • Compare actual weight vs volumetric weight
    • Higher of the two becomes chargeable weight

Step 7: Booking and Rate Negotiation

The freight forwarder contacts airlines or their General Sales Agents (GSAs) to request quotes and discuss available routes and transit times.

After negotiating rates, the forwarder presents options to the importer, who then approves the selected option.

Step 8: Pre-Shipment Logistics

This stage involves arranging pickup from the supplier, organising road feeder service to the origin airport, and planning for export customs clearance.

Step 9: Export Procedures

Upon arrival at the origin airport, the cargo is handed over to a Ground Handling Agent (GHA). It undergoes security screening and export customs clearance before being moved airside for loading.

Step 10: Flight Booking and Documentation

The Air Waybill (AWB) is generated, serving as the contract of carriage.

The airline prepares the flight manifest and load plan.

Step 11: Loading and Departure

The GHA prepares the cargo for loading, transports it to the aircraft, and loads it according to the plan. After final checks, the flight departs.

Step 12: In-Transit Procedures

The forwarder begins import customs processes and submits advance documentation to destination customs and provides tracking updates to the importer. 

Step 13: Arrival at Destination

Upon landing, the cargo is unloaded by the Ground Handling Agent (GHA) and moved to a cargo terminal or bonded warehouse. Consolidated shipments are broken down if necessary.

Step 14: Import Customs Clearance

Customs authorities review the cargo details, potentially inspect the shipment, calculate duties and taxes, and grant clearance once all requirements are met and payments made.

Step 15: Cargo Release and Final Delivery

The forwarder arranges collection from the airport, and the cargo is released from the bonded area. It’s then transported to the importer’s location, where it’s unloaded and delivery is confirmed.

Step 16: Post-Delivery

The process concludes with the forwarder confirming successful delivery, handling any discrepancies or claims, processing invoices and payments, and archiving documents for regulatory compliance.