Fee-based service

A fee-based service is a freight-forwarding pricing model where the forwarder charges the customer a transparent agency fee for arranging transport rather than profiting from the margin between bought and sold freight. The forwarder passes the carrier’s actual rate through at cost and earns a stated handling fee per shipment or per service, so the customer sees the underlying freight and what the forwarder makes on it. This contrasts with the traditional buy-sell model, where the forwarder marks up the freight it buys from carriers. Large shippers favor fee-based arrangements for the visibility they give into carrier rates and the forwarder’s true cost.