Blockchain at work- Disrupting Freight forwarding Industry

Freight Forwarders play a critical role in moving goods, but their knowledge is based on much more than mere transport, although that can span sea, road, rail, and air which can be a heady combination. Freight Forwarders are also experts in local customs compliance, port/terminal regulations, geographical issues, warehousing, packaging, and people knowledge. However, much of this experience is still handled in an old fashioned way through the use of faxes, couriers, telephone and paper – especially the bills of lading.

The Internet of Things (IoT) has already disrupted the passage of goods themselves and for the better. Sensors can track goods ensuring temperatures are controlled, that weight is monitored to reduce theft or loss and provenance can be tracked.

60 years ago, containerization radically shifted the industry and created a new standard for the shipment of goods. Today, modern drones can replace the humble tugboat for dropping goods out at sea. Even Amazon is trailing its Airborne Fulfilment Centre which is in effect a floating warehouse equipped with drones to drop off products. We are even talking about autonomous ships like the self-driving cars only considerably larger.

Online Bookings for Freight Forwarding

Another tell-tale sign that is foretelling the shift towards digitization is the surge in online freight bookings. Mainstream players such as Hapaq Lloyd are witnessing a 6% rise in online bookings with their Quick Quote product and DSV, through its My DSV software, claims a bookings increase of 15%.

An influx of software start-ups in the area is certainly shaking up the traditional Freight Forwarding sector, but again, software alone is not the answer and is not currently displacing experience.

Shippers are also responsible for generating interest in digital disruptions. They want greater transparency, accuracy, and speed. To confirm this, a joint report by McKinsey and Google, highlight the new searches for ‘ocean carriers’ and ‘freight forwarders’ increased by 8% and 14% respectively, and 23% of those searches are carried out on mobile devices.

Technology will disrupt Freight Forwarding, but remember the days when Travel Agents were replaced by online booking engines? Only they weren’t. Many agents up skilled to serve the luxury or adventure market and other organisations converted into online portals. Again, the customer dictates to a degree what level of digitisation they are comfortable with. And with breakpoints across the system, with only 60% of forwarders online, this is not going to happen immediately.

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