The entrance of digital forwarders is driving technological investment as companies look to improve the speed and precision of their services.
Ahead of the release of its annual global forwarding report, analyst Transport Intelligence (TI) has released some of the key findings from interviews and research with freight forwarders and major digital platforms.
The company found that the underlying principles of the freight forwarding market had remained largely unchanged but there had been significant changes in “the structure of the forwarding market” and “the way services are offered to the market”.
The most obvious change, TI said, has been the incursion of digital forwarders, marketplaces and spot market platforms.
The entry into the market of these players has been a key driver of innovation in customer service and experience and the wider movement to embrace new technologies.
TI said that simplicity and responsiveness are driving the introduction of new technology as forwarders seek to rapidly enhance customer-centricity, while forwarders are recognising the demand for speed and precision in operations is a key battleground in introducing technology.
TI economist David Buckby said: “Large freight forwarders have realised that online rate quotation and booking platforms are a great way to win small/medium and ad-hoc business.
“Simplicity and responsiveness of service are often top of the list of priorities for such customers, which digital forwarding in theory should deliver well.
“In practice, however, there can be wide discrepancies in service quality across platforms. Both large forwarders and the newer players are continuously evolving their offerings to get ahead of the competition.”
TI head of research Nick Bailey warned that forwarders which do not embrace change faced the highest risk and added that technologies could also create efficiencies within the business, while also improving the customer experience.
“There’s no established route to success and forwarders are likely to need a suite of internal and external tools to meet all the demands they’ll face,” said Bailey.
“The highest risk comes with no activity – forwarding is and will increasingly be a tech-enabled business in which standing still isn’t an option.
“Beyond that, the character of risk changes – not all technology will mature in the way expected and the market will shift, but using technology to gain operational and customer satisfaction advantages is key to the game forwarders are in at the moment.”
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