Freightos study: Will forwarders and IT ever get along?

1011-elevate-freightos-logoThe freight business is moving online, but not everyone is eager to get on board. The most recent annual “State of Online Logistics Sales 2016 Mystery Shopping Survey,” conducted by Freightos, found that large forwarders have made surprisingly little progress with their online freight booking platforms. “I think it’s time for this industry to catch up,” said Freightos CEO, Zvi Schreiber.

However, behind the scenes, Schreiber said that the wakeup call is beginning to be heard, and forwarders are scrambling to catch up with early movers like Kuehne + Nagel and Delta Airlines.

As most airfreight industry insiders are aware, the capabilities and sophistication of back-end IT systems are rapidly advancing, but what about on the front end? Is the customer experience dramatically different? For shippers looking to obtain quotes and book directly online with a forwarder, the answer seems to vary dramatically, according to Israel-based Freightos.

For the “mystery shopping” experiment, Freightos interacted with the online booking portals of the world’s top 20 global freight forwarding websites (the same ranking that was used in Air Cargo World’s Power 25 list), and requested identical quotes for a less-than-container-load (LCL) shipment from a city in China to Chicago. The quote request included sufficient information for a forwarder to respond with a quote, including load type, harmonized system (HS) code, weight, dimensions, incoterms and a statement that the shipper would compare the quote with a direct competitor.

Before diving further into the results, it should be noted that Freightos is a company that not only sells online quote-automation software, but also operates its own online freight marketplace, so the results of this exercise are not free from bias. Even so, the results indicate the majority of the world’s top forwarders are not equipped to offer fast, automated freight quotes through online portals.

Despite incessant talk about innovation in IT and digitization throughout the forwarding industry, the results from 2016’s survey were actually worse than the conclusions from 2015. Schreiber told Air Cargo World, “the results from this year were abysmal. With the exception of Kuehne + Nagel, there was no improvement. In fact, the average quotation actually took longer.”

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