Chapter one

Introduction

• Background of the study

Nigeria is one of the landlocked countries within West African Development Community (WADC) that faces challenges in accessing international markets for her import and export traffic. The provision of predictable, competitive and reliable transport services is suggested to be challenged due to physical deficiencies in the rail and road networks as well as inefficient border operations that contribute to very high transport costs.

Traditionally, a freight forwarder is an entity that acts as an intermediary between the actual shipper or importer and the carrier. In broad sense, a freight forwarder or forwarding agent, also  called  as  a non-vessel  operating  common  carrier (NVOCC),  is  an  individual  or  a  company  that  aids  to  arrange  shipments  for individuals  or corporations to  get  cargoes  or  goods  from  the  producer  or manufacturer to a customer or customers, a market, or final point of distribution for end users. Forwarders contract with a carrier or often multiple carriers to move the goods. Freight forwarder is defined as an “architect of transport,”  and  the  main roles  provide  efficient  specialized  transport  solutions  through  integrating  its fundamental  roles  such  as;  quotation/booking,  consolidation, cargo  warehousing, custom clearance, delivering and insurance for manufacturer firms in the execution of international transport (FIATA, 2014).  Moreover, it is also an intermediary institution that act on behalf of importers, exporter, or another companies in order to make transport organization safe, efficient and cost-effective shipping (Ciltuk.org.uk, 2015). From this perspective, the main roles of freight forwarder is  to  arrange  appropriate  customized  transport  models  by  taking  the advantage of the collaboration of the fundamental freight forwarding components in order  to  transport  manufactured  goods  to  its  final  destination  under  convenient circumstances. Murphy and Daley (1996) said that the most firms employ international trade specialists to assist with documentation requirements and other  vagaries of cross-border  commerce  and  booking  spaces,  the  payment  of  freight  charges, shipment consolidation, and the preparation of documentation for smoothly custom clearance by an expert international freight forwarder.

Comprehending economic role of a freight forwarder, it is vital to provide a brief foreword  to the  method of  loading and  unloading of  goods  internationally  by multimodal carriage  and  then  think an  entirely diverse  phase  of the horse and carriage of goods globally. An understanding of multimodal transport is required that the freight forwarder uses this method of carriage in performing his duty.  A multimodal or combined transport operator has to  be evidently differentiated from the freight forwarder. A freight forwarder is basically not a carrier, but an auxiliary entity, a professional mediator between the cargo interest and the carrier, who organizes the carriage of goods from departure to destination, but does not undertake to carry himself and does not agree to take liability as a carrier.

Statement of the problem

Different countries have different expenses that have to be paid both at the embarking point and the destination. This causes some ships to remain at sea as they are unable to pay the service charges or the docking charges. These charges are different from port to port, and as there are no standards, it becomes a big problem. Based on this the researcher wants to investigate freight forwarding operations in an emerging economy.

Objective of the study

The objectives of the study are:

1. To ascertain the relationship between freight forwarding and Nigeria economy
2. To ascertain the cost of freight forwarding operations in Nigeria
3. To ascertain what makes some ship to remain in the sea

Research hypotheses

H0: there is no relationship between freight forwarding and Nigeria economy

H1: there is relationship between freight forwarding and Nigeria economy

H02: there is no cost of freight forwarding operations in Nigeria

H2: there is cost of freight forwarding operations in Nigeria

Significance of the study

The study will be very significant to students and ministry of transport. The study will give a clear insight on the freight forwarding operations in an emerging economy. The study will also serve as a reference to other researchers that will embark on the related topic

Scope and limitation of the study

The scope of the study covers analysis of freight forwarding operations in an emerging economy. The researcher encounters some constrain which limited the scope of the study;

1. a) AVAILABILITY OF RESEARCH MATERIAL: The research material available to the researcher is insufficient, thereby limiting the study
2. b) TIME: The time frame allocated to the study does not enhance wider coverage as the researcher has to combine other academic activities and examinations with the study.
3. c) FINANCE: There is no enough finance to source for the materials, thereby limiting the study

1.7 DEFINITION OF TERMS

Freight forwarding:

Emerging economy:

Transport:

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