A new breed of digital platforms for freight forwarding is coming up with a promise of increased efficiency, better transparency and reduced logistics cost plus peace of mind guaranteed
Supply chains that have expanded globally interconnecting businesses across borders have slowly become inefficient, as there is so much to consider while shipping cargo from point A to point B – such as the best mode of transport, lead times, managing documents, track and trace, transparency across the logistics chain and of course the final cost. To manage all this the traditional freight forwarding involved a plethora of emails, phone calls and bundles of paper work, but thanks to digitalisation – technology solutions are now being introduced to address these inefficiencies and thus provide a more efficient, agile and customercentric supply chain.
Traditionally, carriers and forwarders in the industry typically employ large teams of people who build sales, write quotes, and do the legwork necessary to create a price point for a shipper who is looking to move cargo. While this system works, it has its limits. This is where a digital platform has the upper hand. With the ability to analyze a broad range of pricing and booking metrics almost instantaneously, shippers can get the most accurate price point and book in less time than it takes to pick up the phone.
Ask Biplob Barik, CEO & Cofounder of Boxnbiz, “Coming from an international freight forwarding background I have seen most of the shippers complain that they have to spend 60 per cent of their time managing logistics activities with their freight forwarders. It used to take 72 hours to find a freight quote, more than 70 odd documentation for an end-to-end consignment and huge losses just because of lack of transparency in supply chain.”
As per a report shippers losses $7billion annually just because of delays and bad decision. “The industry lacks a great shipping experience and this could be solved by delivering services through software,” reveals Biplob. Today Boxnbiz is a digital freight forwarding and customs brokerage company into the mission of fixing broken user experience in global shipping industry. Right from booking, collaboration, reporting to payments and many more could be managed from an intuitive cloudbased software. Shippers can easily procure rates, manage orders, track in real time, generate reports and make payments online. This logistics suite helps them to scrape of 2/3 of their procumbent time at half of their involvement at 20 per cent reduced cost.
There is something for the service providers as well. Carries, freight agents and transporters who come aboard these platforms benefit with increased visibility transforming into more sales. “Doing this we have seen 25 per cent increase in our logistics partners sales,” reveals Biplob.
Mohammed Zakkiria, Cofounder, FreightBro – another digital platform for freight forwarding shares a similar experience. “The manual and repetitive nature of everyday operations are primarily where most of these inefficiencies stem from and they remain same irrespective of forwarders’ size. Procuring rates is still a tedious task in the industry. Most of the shipping lines still send rates on email or spreadsheets to forwarders. There is no visibility on how many times forwarders opened those rate emails/spreadsheets, which port pair they are actively searching for and reason for lost bookings. Our platform is bridging the gap between small forwarders and shipping lines, by providing a more data-centric approach to businesses which facilitates better and informed decision making.”
“As a SaaS company, we offer Web and mobile-based applications to forwarders & 3PLs which can digitize their key processes like sales, procurement, operations and also give an end to end visibility to their customers. Digitization here refers to the automation of the manual and repetitive tasks. We see an approximate reduction of 50 per cent of sales costs and 70 per cent of operations cost,” informs Zakkiria. A custom mobile application to 3PLs enables to search, book and track shipments. FreightBro has so far generated more than 5000 teu worth bookings from small forwarders. Trucking companies can benefit from the movement of door-to-port & port-to-door loads. Other value-added offerings from FreightBro partner ecosystem are co-loading, insurance and trade finance.
Meet Cogoport, this platform operates as a marketplace where customers can see, instantly, in one place the available prices and sailings for their cargo and they can book at the click of a button. It saves them contacting multiple sellers and waiting (sometimes days) for quotations. “When you’re having to quote a shipping price to your consignee it’s a big help and makes the process more competitive. Users can track the progress of their consignment at every stage of its journey, in real time,” reveals Purnendu Shekhar, CEO of Cogoport. Cogoport advertises rates from more than 60 shipping lines and NVOCCs and partners with over 300 freight forwarding service providers.
Digitalising and optimising the global shipping experience is FreightCrate Technologies. This comprehensive online freight rate and shipment management solution for both customers and freight forwarders offers services such as door-todoor shipping via air and ocean; Customs clearance and trucking; all-inclusive and standardized freight pricing online; shipping schedules from multiple carriers; shipment management dashboard and data analytics.
“The digital platforms will surely give shippers a better experience and transparency, but indicative rates do not determine the actual cost. The INCO terms would determine the cost which would also determine the services that are provided by the freight forwarder.” – S Ramakrishna Chairman, FFFAI
While all the digital platforms boast of instant access to freight rates, but S Ramakrishna, Chairman, FFFAI brings out a valid point – “The digital platforms will surely give shippers a better experience and transparency, but indicative rates do not determine the actual cost. The INCO terms would determine the cost which would also determine the services that are provided by the freight forwarder. This digital concept has been in the west for a long time still the business of freight forwarding is growing day by day. The professionalism needs to be maintained and it would also need quick upgradation of market condition, routes, transhipment, etc. We should also keep in mind the consolidation of shipping lines is another factor which will have far more implications than the Digital platforms.”
“Tomorrow if a shipper can do Customs clearance online through self-declaration and also procure space on shipping line, what is the role left for a traditional freight forwarder?” – Vivek Kele Director, Teamglobal
Taking a closer look at freight forwarding, Vivek Kele, Director, Teamglobal says, “Freight forwarding involves a gamut of services and it’s difficult to digitalise all of them and offer it as a single service on a digital platform in the near future. From what we see that individual services are being digitalised in part, we are a long way before it can be made available as a fully digitalised service in whole, there is a need to standardise all individual services like Customs clearance, transportation, CFS services, etc before they can be combined as a single digital freight forwarding service.”
Shippers’ perspective
While the digital platforms continue to boast of the efficiencies they offer, the ultimate feedback can be only had from the shippers who are using them. Eruvaka Technologies Pvt Ltd, an aquaculture solutions provider has been moving its exports through Boxnbiz. Venkata Ramesh, Director & COO of the company seems to be enchanted by the services. “We have our customer base in Latin America and every month we do quite a few shipments. If I need a quote from Krishnapatnam Port to Roshan Gathibandhe from Zim Laboratories is another tech savvy exporter of pharmaceuticals to Iran and Algeria, making shipments through Cogoport. “If I make an enquiry for a container from shipping line through Cogoport I get the details in half an hour, which earlier used to take 2-3 days.” For tracking a consignment earlier we needed the master BL number to check on the shipping line’s website, but with Cogoport we can instantly login and track consignments live. We are able to save 2-3 days in shipping time while the cost has decreased 15-20 per cent reveals Roshan.
“For tracking a consignment earlier we needed the master BL number to check on the shipping line’s website, but with Cogoport we can instantly login and track consignments live. We are able to save 2-3 days in shipping time while the cost has decreased 15- 20 per cent.” – Roshan Gathibandhe Zim Laboratories– Roshan Gathibandhe, Zim Laboratories
Honduras Port I can get the quote in 10 minutes. Now compare this with the traditional freight forwarding wherein I used to get a quote after 2 days. Online payment facility for booking containers is available through which banking charges are saved. Right now if I check the status of my 3 shipments I can see one has reached Seoul Port, the other is at VN SGN Port and the third at TGA Port. In the traditional system we had to use a bill number on the shipping lines website which is not updated always and if there is any mismatch in the destination or any error in documentation then the shipment is held back and will need to catch the next vessel. So many times my shipments got delayed due to error in documentation. Coming to documentation, at Boxnbiz we have templates that give a clear idea of the documents we need to file, while in the traditional system every time some new requirements used to come up. Live chat facility is available for all shipments and response time is maximum 3 minutes. On digital platforms it takes only 3 days to make a shipment – one day each for stuffing the container, Customs clearance and loading onto the vessel. The cost savings is around 20 per cent using digital platforms, but the peace of mind is priceless.
Roshan Gathibandhe from Zim Laboratories is another tech savvy exporter of pharmaceuticals to Iran and Algeria, making shipments through Cogoport. “If I make an enquiry for a container from shipping line through Cogoport I get the details in half an hour, which earlier used to take 2-3 days.” For tracking a consignment earlier we needed the master BL number to check on the shipping line’s website, but with Cogoport we can instantly login and track consignments live. We are able to save 2-3 days in shipping time while the cost has decreased 15-20 per cent reveals Roshan.
“Digitisation will have the most impact on freight forwarders who offer the Plain Vanilla models, a segment of the industry that is already stressed with low yield and high credits.” – Shantanu Bhadkamkar President, AMTOI
The way forward for traditional freight forwarders
“The freight forwarding community doesn’t has a choice but has to start finding solutions which are technology based. Technology to a very large extent has done away with domain knowledge. The older generation had spent a life-time in picking up domain knowledge, but the newer forwarders will not have to work that hard because they will get everything at the press of a button. So, domain knowledge is going to take a beating but people will have to learn technology more and more. It is not very far away when the forwarding community will start working with their smart phones,” predicts Samir Shah, former Chairman, FFFAI. “Tomorrow if a shipper can do Customs clearance online through self-declaration and also procure space on shipping line, what is the role left for a traditional freight forwarder?,” asks Vivek Kele. “Increasing transparency is leading to diminishing of old revenue models and the traditional freight forwarders will need to reinvent themselves by inventing new business models based on value creations.” So the next obvious question is how do the traditional freight forwarders brace to survive the digital transformation? Vivek Kele suggests, “Digitalise your own services, invest in technology and add value, that’s the Mantra for survival in the digital wave.”
“Live chat facility is available for all shipments and response time is maximum 3 minutes. On digital platforms it takes only 3 days to make a shipment – one day each for stuffing the container, Customs clearance and loading onto the vessel. The cost savings is around 20 per cent using digital platforms, but the peace of mind is priceless.” – Venkata Ramesh Director & COO, Eruvaka Technologies Pvt Ltd
“Digitisation will have the most impact on freight forwarders who offer the Plain Vanilla models, a segment of the industry that is already stressed with low yield and high credits. These businesses will have greater motivation as the compulsion and the urgency to evolve new business models will be higher. If we take a look at the evolution of freight forwarders over the last 150 years, we will see that not only the forwarder has changed continuously with time, but there also have been phases of transformation. These are the times that separate the men from the boys,” points Shantanu Bhadkamkar, President, AMTOI.
