Freight Forwarders Have to Provide More Value to Shippers in Future

A question from the audience was posed by National Air Cargo’s Chief Growth Officer, Alan White: Digitalisation of the supply chain has allowed shippers to directly connect with shipping lines and airlines. In this scenario, Mr White asked, what did the future look like for freight forwarders?

Retired Aviation and Air Cargo Executive Ram Menen replied that he did not think the role of the freight forwarder was going to be eliminated but their role in the supply chain was going to change.

“De facto their role will become that of a shipper,” said Mr Menen. According to him this has been gradually happening for some time but is beginning to accelerate as digitisation is setting in bringing with it greater transparency in the supply chain.

In order to stay relevant the freight forwarders have to find ways to integrate themselves more deeply into the shipper’s supply chain by providing more value added services for their customers.

Speaking from an airline perspective Mr Bader Al Ali, Senior Commercial Manager at Etihad Cargo said that the role of the freight forwarder would not be eliminated - at least in the near future. What the airlines would do is “derive more value” from their partnerships with freight forwarders.

Mr Al Ali said that at the end of the day it is a logistics chain and as an airline, Etihad did not intend to jump into the freight forwarding part of the supply chain.

Due to the difficulties that the pandemic has recently created shippers are looking for better and cheaper solutions to move their goods but most of them would not be looking to cut off the freight forwarders from their supply chains, feels Mr Al Ali.

TLME Chairman Joe Beydoun, speaking on behalf of Fast Logistics, said that there will definitely be a need for freight forwarders in the future as there are some tasks that only they can do efficiently and economically.

However, unless freight forwarders find ways to innovate and change the way they do business in the future, they will be eliminated.

Taking an example from the electronics industry Mr Beydoun compared Apple and Samsung to Kodak and Blackberry: “Those freight forwarders who are the Kodaks and the Blackberrys of the industry who think they are doing a great job and will continue to do what they have been doing as before, guess what? The world is coming to change you and you have to accept that change.”

The demands of the supply chain are changing rapidly today and freight forwarders will have to keep up with the changes or be squeezed out, said Mr Beydoun, while acknowledging the innovative systems that Fast Logistics have recently applied in their operations as freight forwarders to emerge leaders in their field.

Read More: Have to Merge Traditional Knowledge with Modern Tech: Etihad Cargo