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Determining International Shipping Prices

Engaging in international shipping business can be an uphill task to people who are new in this field. This normally calls for considerable amount of experience unless one is willing to run the risk of being duped. Before sending and receiving consignments internationally, one has to know how the process is normally conducted especially regarding the price. International shipping prices will vary from one mode of transport to another. Air transport is considered as having the highest international shipping prices as compared to road, railway and sea transport. This is mainly due to its urgent nature especially when handling products that are highly perishable which need to be transported urgently. There are several factors that help to determine international shipping prices which include the following:

First, the distance to be covered by the shipment comes in to play. Consignments that are headed for longer distances are normally charged higher as compared to consignments headed for shorter distances. Long distances mean that the shipping company has to incur an extra cost in ensuring that the consignment reaches its destination as stipulated in the contract signed between the shipping company and the consignee. This factor applies equally to all modes of transport as their international shipping prices are pegged on the distance to be covered.

Secondly, the urgency of the consignment is also important in determining international shipping prices. Consignments that are very urgent mean that the shipping company will have to make special arrangements to ensure that the cargo arrives at the time requested by the consignee. The prices become even more expensive when the consignment has to arrive on the next day. This is expensive because the shipping company will have to commit much of its resources in ensuring that the consignment is delivered on time as directed by the sender. Otherwise, a breach of contract would have happened which will stretch the working relationship.

Another factor that determines international shipping prices is the nature of risks involved in transporting the consignment. For instance, if the consignment is supposed to be delivered in a place that is ravaged by war or conflict, the shipping rates will be very high as the shipping company would have to hire more security personnel and even outsource others to make sure that the goods are delivered safely. Another example is the threat of pirates who normally hijack merchant ships and demand for ransoms before releasing the ship. Cargo that is headed in that direction will be charged highly due to the threat of attack by pirates.

Furthermore, fuel prices also influence international shipping prices. Since most of the shipping vessels are run by fuel, a change in the price of fuel will affect the shipping rates being charged. If there is an increase in the price of fuel, it means that there will also be an increase in the shipping rates to avoid the company from operating on losses. On the other hand, if there is a significant drop in the prices of fuel, the international shipping prices will also reduce.

Posted on November 29, 2018