Guide to Freight All Kinds (FAK) Ocean Freight
Imagine your business imports a variety of goods: electronics, clothes, home decor accessories. It’s not uncommon to import and export diverse products.
Now imagine the headache of dealing with different pricing structures for each of these items based on their individual characteristics.
This is where Freight of all Kinds, or FAK, comes in. It’s a pricing method that allows different kinds of freight to be shipped according to a flat fee – and it makes the lives of importers, exporters, and freight forwarders a lot simpler.
How does FAK work? And how does it make logistics operations easier?
Read on to find out.
Note: FAK has a different meaning for LTL trucking. This article deals with FAK for ocean freight.
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What is FAK?
FAK in international ocean shipping is a pricing model that charges the same freight rate for all the types of freight in a container, without differentiating based on each product.
Using FAK makes it easier for freight forwarders to provide price quotes since it allows them to offer rates for a wide variety of goods. It also makes it easier for them to book space with carriers since they can book different shipments on the same container for the same rate.
It also makes it easier for importers and exporters to get freight quotes from freight forwarders, since each type of item does not require a specialized price quote.
Note: Rates on the Freightos.com marketplace are FAK rates for general goods. If you are shipping something else, you can request a custom quote.
Advantages of commodity FAK
FAK provides several benefits:
Simplified pricing
When a single rate is used for an entire container, it simplifies pricing for importers and exporters, freight forwarders, and carriers, reducing the need for complex calculations.
Administrative efficiency
FAK removes the headache of categorizing and pricing individual commodities. Importers and exporters can avoid the time-consuming process of negotiating separate rates for each type of cargo, streamlining their shipping operations.
Flexibility
FAK provides flexibility for shippers to mix different types of cargo within the same container without affecting the shipping cost. This allows shippers to use available space more efficiently.
Cost savings
FAK can offer cost savings for importers and exporters who ship diverse goods. By using a single rate for the entire container, shippers may achieve better economies of scale and lower overall shipping costs.
Predictable budgeting
With FAK, importers and exporters have greater predictability in budgeting for shipping costs, since their costs are not tied to specific items. This makes it easier to plan logistics financials.
Time savings
FAK can save time for both shippers and carriers by simplifying the pricing and documentation processes. This allows them to focus more on other aspects of their business and shipping operations.
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What types of items cannot be shipped under FAK?
FAK is the base rate for most kinds of freight, but not all. In particular, goods that require special handling or specific types of containers might not fall under the category of FAK. If you’re shipping any of the following types of goods, reach out to a freight forwarder or the Freightos.com team to see if you’ll need a custom quote:
- Hazardous goods
- Extremely high-value items
- Cargo for a government or military
- Goods used for disaster relief
What is the difference between FAK and HS Code?
FAK allows for flat freight pricing across different types of goods.
However, it does not replace the need to provide accurate HS codes for each of your products. HS codes are used to determine your customs duties and fees, and customs rates differ by product.
In other words, even when you are using FAK rates for freight rates, you’ll still need the right HS code for customs rates. Your forwarder can help you determine the correct HS codes for your goods.
Discover Freightos for seamless shipping
Navigating the complexities of shipping logistics demands a solution that offers simplicity, efficiency, and reliability.
On the Freightos.com marketplace, you can find instant transparent pricing across dozens of forwarders, then book, pay, and manage your shipment all in one place.
