What is Merchant's Haulage?
Merchant's Haulage: The customer organizes the pre-carriage and on-carriage of the container
When it comes to handling large quantities and delivering them to their respective destinations, sea freight is the measure of all things. The costs of shipping by sea are summarized as ocean shipping costs, and are significantly lower than those for air freight. In addition, the handling of shipping company-owned containers differs, which is already clear from the term Merchant's Haulage.
proLogistik explains the background and shows the difference to Carrier's Haulage, the counterpart in the form of a settlement form.
Definition of Merchant's Haulage: What does the term stand for and what does it entail for the shipper?
When we look at container traffic, it is essentially land-based transport sections that matter. The forwarding agent is usually responsible for taking over the entire organization of the transport. This concerns the following scenarios:
- Pre-carriage, i.e. the transport of the containers to the respective seaport
- On-carriage, i.e. the transport of all goods in transit from the seaport to the actual consignee
Important: Merchant's Haulage is a contractual clause that states that the merchant, in his capacity as shipper and/or consignee, is responsible for pre-carriage and on-carriage - including the associated costs. The logistics service provider is limited to the main activity, i.e. sea transport (so-called main run).
Merchant's Haulage versus Carrier's Haulage: What are the differences?
The handling of all important transport sections is decisive, also in view of the relevance due to deadline pressure, customs formalities and co. This is where the cost factor associated with the respective transport of containers is decided. Merchant's Haulage puts the freight forwarder in a position to offer these below the prices that are decisive for Carrier's Haulage. Among other things, this has to do with the fact that more free time is available, which can be used for round trips, for example. Provided that appropriate planning is in place, this means that the transport process can be optimized accordingly.
In order to better illustrate this aspect, it is necessary to know and classify the basic features of Carrier's Haulage. Here are the essentials in a nutshell:
- Carrier's Haulage is a form of contract in landside containerized freight transportation that states that the shipping company is responsible for all aspects of the transportation chain. This includes pre-run, main run as well as post-run. As the sender or recipient, typically the retailer, this means that certain deadlines must be met. This means that the corresponding goods are only available for purchase or provision free of charge within a relatively short time window. The shipowner often acts as a total service provider, which has the advantage of earning a higher profit share on additional services. This is accompanied by mostly higher utilization in terms of shipping company-owned containers.
In short: Merchant's Haulage as a form of organization is equally suitable for Full Container Load (FCL) or Less than Container Load (LCL). It offers retailers the opportunity to use their own structures and thus achieve advantages - both organizationally and economically.
Concluding remarks on Merchant's Haulage
All steps from sender to logistics handling to transshipment are coordinated as part of the pre-carriage process. The main run then includes transport to the recipient's logistics handling facility. The actual delivery of all shipments, on the other hand, are referred to as post-carriage.
Merchant's Haulage enables freight forwarding customers to organize pre-carriage and on-carriage in their own interests, thereby achieving cost benefits.
