Shippers are increasing their use of digital forwarding platforms to book services, according to a new report from consultant Transport Intelligence (Ti).
The Global Freight Forwarding 2019 report, which is based on a survey of shippers, found that 49% of those taking part have used an online forwarding platform and it expects that by 2023 18.7% of volumes will be booked/shipped online.
Tech-enabled forwarders are a catalyst for change in the global forwarding market, the report finds, but still under question is the extent to which online marketplaces, booking platforms and digital forwarders will fundamentally change the market’s landscape. However, it says that what does seem certain is that if forwarders do not prove agile in their adoption of new technology, they will find that they rapidly lose customers looking for the types of visibility, quotation and easy booking which digital forwarders can provide.
Thomas Cullen, one of the report’s co-authors, said: “Perhaps the most salient characteristic of the present freight forwarding market is that it has not seen a greater level of change. Markets and technologies have both developed significantly, but the overall landscape is broadly similar to that in the previous ten years and there appears to be little drive within the sector to change things fundamentally.”
The report’s co-author, Viki Keckarovska, added: “Survey results show that, currently, shippers are making use of the more basic services provided by online forwarding platforms, such as booking and requesting quotes. While this indicates that online platforms aren’t yet widely used to process more complex tasks, it isn’t to say that their technology won’t advance and offer shippers more sophisticated visibility tools and value-added services.”
Global Freight Forwarding 2019 also examines market size and growth rates, concluding that the market expanded 3.9% in 2018. Although this is down from 8% in 2017, it still represents “something of a high point” – excluding 2017, this was the fastest growth rate since 2010.
“After a bumper year in 2017, 2018’s growth rate was the result of a re-balancing between inventories and demand as shippers were again more able to opt for sea freight services over air. Growth during 2018 in the global air freight market was 3.8%, while in sea freight the expansion totaled 4.1%,” Ti said.