What Is A Triangular Trade? Know Its Benefits

Are you familiar with triangular trade? Is it hard to understand? Or, have you had trouble with it in the past? Well, here you will get to know the details of triangular trade and what the benefits of such shipping process are. 

It is a type of international trade where a shipment is transported from the supplier’s country to the receiver’s country directly without going through an intermediary one. To make it simpler, if the intermediary company is located in Japan, the supplier is in UK, and the receiver is in India, in a triangular trade, a shipment is transported directly from UK to India, and not via Japan.

International shipping agents offering such service help the clients to get reduced supply chain costs, decreased transit time and optimise the supply chain while dealing with an entity. In this case, the seller has the ability to hide the identity of the manufacturer or producer to the consignee in the third country to avoid them trying to contract directly with the exporter. This means, the clients opting for triangular trade can profit more by directly contacting the customer. In general terms, a deal which has several middleman in between is bound to bring down the profit for the seller. Similarly the cost of the product rises up which can create an impact on the potential customers.

It is definitely going to take a lot time to send a shipment when it is shipped through a third party country. Therefore, instead of two transports, only a single transport suffices which thereby reduces transit time by almost half. This benefit plays a key role in gaining reputation, especially if the client is dealing with emergency products like safety materials and medicinal equipment. Moreover, by reducing transit time, you can allocate more time to product development while simultaneously aiming to accelerate product release and delivery schedules.

Custom clearance is a crucial part of freight systems. A lot matters over your business when it comes to customs. Though most of the companies provide this service on your behalf in return of some freight rates. However, this can be excluded if the clients opt for triangular shipments.

It is recommended to consult the needs properly as to whether or not your cargo can reach the transit point with the help of triangular trade.