Even though people assume UPS, DHL, and FedEx (known as hub-and-spoke shippers) can ship anything anywhere, you should think twice before handing off your critical IT hardware to one of these global giants.
The misconception that hub-and-spoke shippers are substitutes for FGX’s services stem from the fact that these companies ship all kinds of stuff globally. However, unlike hub-and-spoke shippers, FGX only ships one type of stuff – IT hardware. Shipping IT hardware is very different from shipping any other kind of commodity and requires a unique set of services that hub-and-spoke shippers don’t provide, for example, Importer of Record, formal customs clearance, and trade compliance services.
What hub-and-spoke shippers like UPS, DHL, and FedEx are built for is providing top-notch general shipping services for the average consumer or simple business needs. The average consumer typically ships low-value, personal items that don’t have complex import requirements and the average business ships documents, samples, replacement parts, or other low-value items. However, IT hardware is the complete opposite: it’s a high-value and highly-controlled commodity – meaning it’s difficult to successfully import without a deep understanding of country-specific requirements.
In addition to having complex import regulations, IT hardware needs to be shipped on a secure & quick mode of transport, cleared via a formal clearance, and in many countries imported with an Importer of Record service – all of which FGX provides.
To further elaborate on how we compare with hub-and-spoke shippers, below are side-by-side comparison tables (categorized by services):
IT Shipping Logistics
|UPS, DHL, FedEx
|Direct Freight: Shipments are sent direct to their final destination on a commercial or cargo airline.
|Hub-and-Spoke: Shipments are sent consolidated with many other shipments and pass through multiple hubs to be re-routed to the destination.
|Dedicated Delivery: Shipments are delivered on dedicated, secure vehicles. Our drivers can execute specific instructions, hold at a location and will provide live updates.
|On-Route Deliveries : Shipments are delivered with other parcels, on a regular truck route. If the recipient isn’t available when the driver arrives, they’ll immediately move onto the next stop.
Conclusion: Because IT hardware is valuable and fragile, we utilize direct air-freight and dedicated delivery vehicles to greatly reduce transit time and drastically decrease the chances of loss as compared to a hub-and-spoke network.
|UPS, DHL, FedEx
|Formal Clearance: Shipments valued over $2500 need to be formally declared. Our global team of in-house customs brokers formally clear our shipments on a per-deployment basis. Specifically analyzing each shipment to ensure a smooth clearance. If any additional documentation is needed or customs has an enquiry, our dedicated team is on-top of it immediately.
|Bulk Clearance: Shipments sent with hub-and-spoke shippers are cleared under a bulk clearance. A bulk clearance results in these companies trying to clear as many shipments as they can as quickly as possible. If there’s an issue with your shipment, it’ll get placed in a queue and held until you call and try to resolve the issue.
Conclusion: IT hardware is subject to many import and documentation requirements. To ensure a swift and problem-free clearance, a private customs broker must be hired to review and clear high-value shipments; FGX always utilizes our team of private brokers for clearance.
|UPS, DHL, FedEx
|Paperwork, Permits, & Licenses: FGX manages all the required documentation to import technology hardware internationally on your behalf. From encryption permits for firewalls and routers, to electrical conformity documents for PDUs and power supplies, we have you covered no matter the type of equipment or the most complex of destinations.
|No Documentation Support: Hub-and-spoke shippers don’t manage any paperwork for you. If something is missing, they’ll put your shipment off to the side and wait until you call – to maybe tell you what’s needed. In many cases shipments need a permit or license prior to shipping. If you ship with a hub-and-spoke shipper without the proper permits, your shipment may be blocked from entry, returned to the origin, or even confiscated.
Conclusion: Import permits and licenses are required in most of the world’s countries, and need to be completed by the foreign importer. As most buyers of IT equipment don’t have experience filing for imports permits and licenses, FGX manages it on their behalf.
Importer of Record
|UPS, DHL, FedEx
|Importer of Record Services: We own business entities all around the world that are specifically setup to import technology hardware. This enables FGX to import IT equipment on behalf of our client’s even if they don’t operate a business entity in the country they’d like to import into.
|No Importer of Record Services: Although hub-and-spoke shippers typically do have business operations in every country, they are NOT setup to act as the importer on behalf of their customers. If you ship to a foreign country and don’t have a business to import it, you will likely have issues clearing customs.
Conclusion: Importer of Record (IOR) services are a must for ensuring a shipment is smooth and hassle-free. IOR services enable FGX to manage our client’s shipments door-to-door without any interaction from the end-user.
A Difference in Service
Another major difference between FGX and hub-and-spoke shippers is customer service. Since IT shipments are very critical to a company’s operations and also may be very expensive, there are always many parties depending on, and monitoring the success of the deployment.
Naturally, hub-and-spoke shippers can’t give the level of attention to detail that customers shipping IT hardware want and deserve – which makes sense, companies like UPS, DHL, and FedEx are processing hundreds of thousands of shipments a day and unfortunately yours can’t take precedence over anyone else’s.
We at FGX understand the critical nature of IT deployments, and provide our clients with accurate cost estimates, custom transit timelines, and country-specific information relevant to any new deployment. We are trusted by the biggest companies in the world and small businesses alike to move their IT equipment when time is of the essence, accuracy is essential, and there is zero room for error.
When should you use hub-and-spoke for IT Shipping?
Despite all the indicators that hub-and-spoke shippers aren’t great for moving IT hardware, they are still a great option for cost-efficient shipping. At FGX we may utilize UPS, DHL, or FedEx from time to time, when it makes sense for the client’s requirements. FGX offers a Managed Courier Service where we ship on our account, handle all of the shipping documentation and frequently add on an IOR services. We may recommend this hybrid service for the following scenarios:
- When you’re shipping less than $2,500 USD worth of goods to an open market (USA, EU, Canada, Singapore, Japan) to one of our business entities that will act as the importer of record.
- When you have a limited budget and don’t have a deadline for delivery, we can ship via hub-and-spoke shippers. If any issues arise during clearance, our team of logistics experts and will sit on hold on your behalf to resolve any problems.