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Digitalised forwarders will be more successful than those that are just large, while transport companies should also join the digital revolution, it was said this week.
Despite logistics’ reputation as something of a Luddite sector, chief executive of Quick Cargo Services Stephan Haltmayer said technology would be key to success for forwarders outside the top 10 – and carriers and airports should also take note.
“A lot of start-ups are looking to our business to come up with some kind of Amazon or Uber for forwarding,” he said.
“If this happens it will be too late to look into the technology. You have to be in at the start and keep your ears and eyes open if you don’t want to get eaten up one day by innovative new kids on the block.
“It will not be the big forwarders taking over the small forwarders in future, it will be the digitalised forwarders attacking the market with customer-friendly platforms that gain the business.”
Technology, he added, was not only useful, but essential, if operators wanted to survive. And while he recognised that forwarding was very much at the start of its journey into digitisation, he believes it should be pushed ahead with, as a collective.
But it’s not just forwarders, he added.
“First of all, the transport players have to have better electronic data interface links throughout all transport companies involved,” he said. “The transport companies are still one of the worst-digitalised industries. This has to do with the complexity of the many factors that are involved in the transport chain.”
Airports also need to increase their competitiveness to attract greater business and offer forwarders alternative avenues, he said.
“Carriers go to the most competitive airports and ports, while the cargo often originates from far away and needs to be trucked long distance.
“But it is not just the gateways, small and mid-size forwarders need to become more competitive too against the big multinational forwarders, and can do this by bundling their freight together. By bundling freight neutrally, they get a far better position to negotiate lower rates with the airlines. We do this via IGLU Aircargo, where we buy about 10-15% better rates in the market.”
The IGLU network allows QCS to bundle buying power with “friendly agents” to approach carriers with volumes that would otherwise only be possible for a multinational to provide. We are also constantly developing our IT system to build a digital platform for all customers and forwarding agents to correspond, book and trace shipments.”
He pointed to time-critical as a particularly strong vertical for QCS, with a lot of work coming from the AOG and spare parts sector. He added that QCS had also put a lot of focus into developing the “very strong vertical” of pharmaceuticals.
“More and more airports and forwarders are certifying their verticals through GDP and other certifications,” he adds. “The specialisation on certain transport verticals will diversify forwarders from the general cargo mass production. Usually the verticals make better revenue because the forwarder has to go the extra mile and offer 24/7 service and special licences. They also have to learn the language of the customer behind the transport to be special.
“Last but not least, the vertical markets are not easy to go into digitalisation because there is still manpower required to meet the delivery times that a digital platform cannot manage.”