Need to keep in step with technology

The sharing of data will be the big revolution that will change the logistics and container shipping industry in the future. However industry players have different views on whether it will be a disruptive change or just improving the way things are done.

According to Maersk Asia-Pacific ceo Robbert Van Trooijen the digital revolution will be a disruptive technology to the supply chain industry. "We're seeing very much that the relationships with the shippers are changing, the buying patterns of customers are changing much more towards smaller order sizes with higher frequency... and therefore the whole supply chain industry needs to re-gear itself towards a different dynamic," he said.

Elaborating, Van Trooijen said: "We are very much focusing on what it means to be the global integrator of container logistics." Illustrating how Maersk is doing this, he pointed out that Maersk is starting by analysing what it takes to digitalise the current high load of documentation required in shipping so that it is visible to everyone along the chain.

Van Trooijen also highlighted the developments that Amazon in the US and Alibaba in China are making in terms of marketing all their services as a one-stop shop. In this regard, he believes block chain technology will be the enabler in what he calls disruptive innovation to bring greater supply chain visibility.

At a simpler but no less important level, AgreeFreight founder Nick Coverdale believes that technology can help the relationship between the shipper, the forwarder and the carrier come back to its fundamentals.

"Years ago there used to be respect between them," he said, adding that this has now long gone as the industry became more competitive and container freight more commoditised.

While he does not see the role of the traditional freight forwarder or small to medium-sized shipper disappearing, Coverdale says his service, which lets shippers see rates for exact sailings and book them directly, will affect the larger NVOCCs (non-vessel operating common carriers) the most.

Instead of neglecting the small shippers and entrepreneurs and favouring the mega forwarders either in reality or electronically as he claims some of the other online freight platforms are doing, Coverdale says AgreeFreight makes things straightforward and simple again, like it used to be decades ago when a booking was simply made with a phone call.

NVOCCs, who he also says have been given too much power by the carriers because they were distracted trying to make ends meet, will see some business being eroded because smaller shippers can go direct and not have to go through them.

"The traditional freight forwarder will continue but the people that will be most affected by this are those that rely mainly on earning profit from container movement itself and nothing else," he said. "I see that way of contracting as just disappearing; I don't see any future in that."

While the increasing use of technology in the logistics and container industry will not necessarily mean the demise of the freight forwarder, all the parties involved will need to adapt to keep up with the times.

Posted 11 May 2017

© Copyright 2019 Seatrade (UBM (UK) Ltd). Replication or redistribution in whole or in part is expressly prohibited without the prior written consent of Seatrade.

Vincent Wee

Asia Editor, Seatrade Maritime News

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