Opinion: Hype and Reality for Today’s Forwarder
B>Christopher Coppersmith
I>President
arget Logistic Services
How many times have we read in the financial press that Company A is divesting itself of a number of corporate divisions, or that Company B is disposing of certain assets? The goal always is the same: to get back to a company’s “core” business.
But look down the road. Surface and air-freight forwarders seem to be traveling in the opposite direction. Rather than returning to their core functions — moving customers’ cargo from Point A to Point B — many forwarders are falling all over themselves to proclaim their companies’ “total logistics providers” offering “seamless supply management” for their customers’ freight.
Who’s out of step? The executives in dozens of companies who assert that only by returning to the manufacture and distribution of their core products will bottom lines improve? Or is it those forwarders who insist they can prosper only by expanding and diversifying their menus of services?
As with so many business questions, there are no hard and fast answers, but let me offer some personal observations. In my 30 years as a forwarder and customs broker, never has a shipper asked, “Are you a total logistics provider offering seamless supply management?” But I have been asked countless times about my prices and my menu of services.
Cargo consultants and academics may speak in techno-babble, but shippers do not. They ask direct, hard questions and expect direct, hard answers in clear, simple English.
Yes, our business is changing. Not only is forwarding today a far different business than when I entered it three decades ago, but it has changed even within the past five years. Furthermore, it will continue to change and progress through the 21st century.
Our business will not evolve very much in the way we move our customers’ freight. Trucks will remain the principal means of delivering cargo, with air as an adjunct. The enormous changes will occur off the road. They will continue to evolve both in the realm of technology and also how we interact with vendors, suppliers, customers — and even with other forwarders.
The maxim that information about a shipment is as important as the shipment itself has become a cliché in freight transportation. As with many clichés, though, there is a great deal of truth in them.
How we collect, track, retrieve and store information and how we communicate that knowledge to shippers and vendors will continue to evolve. Perhaps equally important, albeit less understood, is the molding of new relationships among the different sectors of the transportation industry.
Forwarders always have been proud of their independence and ability to stand alone. However, this go-it-alone outlook is being modified by the changing dynamics of our business. Adapting to these new realities will be particularly important to the hundreds of small- to mid-size forwarders that remain the vital heart of our industry.
Alliances between domestic and international forwarders are expanding at a steady pace, with this trend expected to intensify in the years ahead.
Domestic shipments and international cargo are being blurred as global economies increasingly mesh. Forwarders who engage principally in domestic shipments are cooperating closely with international consolidators. Links among forwarders, customs brokers and truckers are becoming tighter.
These relationships also are being driven by fierce competition in every segment of our business. The very large forwarders that once disdained smaller shippers’ business are furiously competing for these shipments.
ational and local truckers, once respectful of each other’s turf, now think nothing of invading the other’s territory.
Air integrators, who once championed overnight service to the exclusion of almost every other kind of delivery, now are praising second- and even third-day capabilities.
Many truckers, once content just to move cargo with the forwarder selling it, are making louder noises about selling “direct.”
We forwarders should not short-change ourselves. We can bring an enormous number of transport options and performance skills to a shipper’s table. Here are just a few of the capabilities a forwarder can offer:
LI> The ability to fill every transport gap — door-to-door, door-to-airport and airport-to-door.
LI> Handling all documentation, including responses to new security regulations.
LI> Our own, or franchised, offices throughout the United States and responsible agents abroad.
LI> The ability to tell shippers exactly where and when their freight was delivered.
LI> Cost analysis of a customer’s needs on pricing and service.
LI> Monitoring every step of the transportation cycle.
LI> State-of-the-art information technology and Internet capabilities.
I am convinced the above realities will be strengthened further and solidified. New alliances and cooperation between forwarder, trucker and airline will be forged. With these realities, who needs hype?
Based in Compton, Calif., TLS provides air and ocean forwarding, customs brokerage and other logistics services.
This story appeared in the Feb. 16 print edition of Transport Topics. Subscribe today.
11155
