Contrasting a traditional and online freight forwarder

This indicates a clear need to move towards digitization. But as with everything, it’s easier said than done. Let’s take a look at just how many freight forwarders are doing so, and how digitization affects workflow and processes.

Most traditional freight forwarders have websites, but they mainly only talk about the services they offer. These days, only the more advanced online freight forwarders feature documentation and rate functionalities on their site.

Being able to get an immediate quote is still considered a luxury in today’s freight forwarding world. Perhaps only a handful of traditional freight forwarders offer immediate quotes and that’s typically for their own LCL products. They also often come in the form of a tariff where shippers would have to check other ocean freight and surcharges separately. In short, the math is not done for them and the end charges have to be calculated by themselves.

Today, only a handful of traditional freight forwarders provide tracking tools and sailing schedules. Again, these would probably only apply to their own LCL cargo. Compared to traditional forwarders, online freight forwarders tend to have tracking tools for a wider variety of shipments.

Technologically, start ups are the ones that are pushing the digital setup. You won’t see many new forwarders entering the market intent on doing business the old-fashioned way. Everyone is trying to bring something to differentiate themselves.

There are many traditional old school freight forwarders who will be very reluctant to this change, however. For some, just moving to a operating in paperless fashions is a terrifying idea. This is mostly because of how complex the nature of the industry is.

Over the years, most traditional forwarders have developed routines that help their staff keep track of what needs to happen with a shipment using paper folders and various types of notes. Copying the type of flexibility some of these set ups have into a digital system seems like it should be easy but that seems to be an ongoing hurdle.

The revolution is slowly but surely picking up steam. But I reckon it will still be a long way, and by that I mean decades to go before traditional freight forwarders are phased out.

Right now, the digital companies are just starting to make their presence known. The big players in the industry have begun work on digital improvements. Their success with new platforms will largely determine how quickly others will follow suit. If they succeed, mid-sized forwarders are likely to emulate their moves. Smaller forwarders will find themselves having to team up with others, form freight associations, or depend on neutral NVOs to have a shot at competing.

The big guys are essentially the ones setting the pace. If they don’t nail it with their upgrades, the mid-sized and smaller forwarders will certainly not feel pressured into making the same investments as they won’t be too impacted.

As long as the current freight generation of decision makers is still around, the market for forwarders who prefer to focus on personal connections with shippers will stay. I hope as forwarders develop systems, they achieve a method that balances personal touch and digitization.

I would love to see a system that allows this valued personal relationship to really shine through and work hand in hand with digitization in order to propel freight forwarding staff to the front line to really benefit the end customers.

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