Freight Forwarders are the ‘Amazons of logistics’

For the general readers, I will list down the basics right away. With work from home becoming the new normal, let’s assume, you are in the process of setting up your home office. You order for a work desk, chairs and a couple of accessories to go with your daily drivers on amazon.com. Amazon enables the discovery of these products with multiple options and ensures smooth shopping experience. We might know, most of these products are not owned by Amazon but owned by the merchants selling them. Amazon just enables great customer experience by providing convenience, guaranteed time bound deliveries and constant updates. Ok, Let’s not get into another lesson on Amazon!

Let’s take this analogy into freight/container transportation(yes! the big steel boxes on highways and ships). Here, A cargo owner (like the merchant who sold the table on amazon) wanting to export or import goods in any form, reaches out to freight forwarders(the star of this article!). They have many super powers, sometimes forwarders have a ‘shipment-sense’, an antenna to locate cargo ready for dispatch without being contacted. Forwarders then share service options like schedules, routing, pricing and many more to the cargo owner. They negotiate(fight should have been the right word) with the actual operators(vessel operator/shipping liners, airlines, customs, transporters, and 20 other entities!) to get the right service at the right cost for their customers. The day is not saved yet, the forwarder then ensures the cargo is delivered seamlessly by coordinating with all the 20+ parties and documenting every aspect of it over the span for 30–45 days of the cargo’s ocean freight journey. The forwarder’s only goal is to ensure delight of the customer. A typical freight forwarding executive can talk logistics at 300 words per minute(another superpower) and can multi-task flawlessly. The term mass customisation was practiced by them before it was coined in some business school. The love to serve their customers is what is keeping them up and running.

Technology is catching up in every industry and has always been a tool and enabler rather than disrupting the industry totally. In logistics, some people(typically who don’t understand logistics) mention freight forwarders as the middle-layer in logistics and new digital companies can threaten their existence. This is far from true, freight forwarders are more like a flywheel between all parties and not a middle layer between two parties(Those are travel agents!). Claiming that, delayering the industry by removing traditional freight companies to reduce logistics costs is like peeling an onion to find that everyone is necessary in their own regard. Every industry goes through a cycle of laggards getting left behind due to various factors(not necessarily competition). And, Attributing this change as shake up by digital players may not be the right judgement. Amazon could shake up the retail space not just with technology but mainly due to ‘insane customer centricity’ and still Shopify’s mantra of technology should be owned by every merchant, not by one company is slowly rising up and reaching the surface.

Freight forwarders are known to go an extra mile (literally) everyday to ensure excellent customer experience in this complex industry. And, they have started adopting technology for the same reason. Digital freight companies are not the future or ‘amazon of shipping’, in reality, ‘freight forwarders with technology are the amazons of shipping’. It’s even right to say, ‘Amazon is the freight forwarder for e-commerce’ as forwarders have been existing since the birth of trade. At Freightify, we enable the freight forwarders to serve their customers efficiently using the right technology. Freight forwarders are typically behind the scenes and hence the consumers typically don’t appreciate the efforts of forwarders. This post is to make the readers aware of a community called freight forwarders who are extremely customer centric logisticians, and to realise their contribution in the global trade and the products we use like our own home office.

We will try and capture the controlled chaos in the shipping industry with the help of some industry experts in weeks to come for the general world to know and learn. I can assure you, it’s damn interesting!