Freight forwarders don’t have it easy in 2015: freight rates and oil prices are highly volatile; the market is undergoing structural changes as patterns of demand evolve and opportunities disappear as quickly as they arise; and an uncertain global economy means that forwarders need to be attuned and responsive to macro-trends.
As such, the importance of technology to freight forwarders cannot be overstated.
Our report looks at the challenges freight forwarders face in overcoming these deep-rooted issues.
Key trends that could influence new technology adoption in order to keep costs and competitors at bay include:
- Yield dilution: One of the long-term trends in the industry has been dilution of yields, which means that forwarders have to work harder to maintain their revenues.
- Relationship with global trade: The global logistics industry is already seeing a major change to the relationship that drove its development over the last three decades.
- Shifts in regionalization, near-sourcing and emerging markets: Manufacturing and retailing are moving to back regionalized supply chains after years of globalizing.
In addition to the above, our report also found that as logistics operations evolve into leaner, more agile services, the functional boundaries between different systems are likely to break down.
As a result, a new generation of application services will emerge that perform the same functions of existing applications, but as a continuous service.
In other words, freight forwarders who resist new technology adoption and continue to work with legacy systems may fall behind the competition.