There is a common question among freight forwarders: Should they enter the digital world? Whether they should or not, one thing is certain. Freight forwarders must understand that digitization is the key to unlocking the world to new opportunities.
As per Merchain collaboration, only in the transport and logistics sector, the worldwide digital transformation market was valued at US$ 54.92 billion in 2018, with a projected rise of US$ 145.28 billion by 2025. Given that global trade is mostly carried by sea, we may presume that most of the investment in this digital transformation was undertaken in collaboration by digital freight forwarders, leading shipping firms, and container ports, among the industry’s major participants. So, since company development is linked to the usage of new digital technologies, freight forwarders must undergo digital transformation to thrive in the logistics sector of the global supply chain.
Challenges faced by the freight forwarders in the absence of freight forwarding software:
- Ocean carriers approach shippers directly to share all the rates in the absence of any freight forwarding software. With freight management software, Ocean carriers are encouraging shippers for digital quotes and bookings without any intervention from freight forwarders.
- As per the survey done by ECU Worldwide Ltd, around 56% of freight forwarders around the world feel that the cost of containers and unpredictability as the biggest challenges because they are not getting/maintaining any sailing schedules/container planning in the absence of a freight forwarding system.
- As a freight forwarder, it’s easy to get overwhelmed by all the documents and messages you need to keep track of and communicate with the right stakeholders. The risks of having miscommunications with internal and external stakeholders are very high because of the manual processes.
- Freight Forwarders fail to meet the customers’ expectations in terms of real-time tracking of the containers, providing the reports and analytical tools for analyzing the business processes, and especially getting the trends of freight forwarding business post-pandemic.
- Unable to match up with speed on the global changes happening in the logistic industry, leading to unexpected delays in the operations process, and increasing competition in freight forwarding business.
- Revenue leakage and fall in overall business profits because of managing the finances and invoices manually.
Benefits of embracing a reliable freight forwarding software
There are numerous reasons for a freight forwarder to go digital. Digitization is the future of the freight and logistics industry. Relying on a digital service provider will assist you in transitioning to digitization smoothly. As per the global survey conducted by ECU Worldwide Ltd, 90% of freight forwarders believe that the future of the freight forwarding business is digital.
- With the help of Digital adoption, freight forwarders can give their shippers access to real-time data. By doing this, you are providing convenience to your customers, and they can do away from relying on emails and calls. Due to this, not only do your shippers feel more informed about their shipment status, but your team will also save time that they would have spent providing unnecessary updates.
- Many Digital First freight forwarders have a good handle on the tech and operations side. Reputation and relationship alone are no longer enough to secure business in the logistics industries now. However, by combining digital advantages like digital quotes, booking, e-invoicing, real-time tracking, and data analysis, you can position your business to stand out from the competitors. As per ECU Worldwide Ltd. survey, more than 40% of freight forwarders are very interested in real-time tracking, digital quotes, and booking services.
- Freight forwarders can avoid unexpected delays while shipping shipments. They can pay attention to cargo transit time, and if they notice any extended delays then try to unblock them. They can also optimize the routes with the help of data received from a digital system.
- With the help of freight forwarding software, you can avoid miscommunication with stakeholders and get all the communication data on a central platform.
- With freight management software, you can easily adapt to the new changes happening in laws and regulations for different countries. Also, with digital invoicing, you can avoid revenue leakage in the organization, resulting in increased organization profitability.
Health Checkup Report (Survey conducted by Ecu worldwide – ECU360 Team):
3 challenges faced by freight forwarders: