New technology was beginning to make considerable inroads in the manual, paper-based freight forwarding industry before the COVID-19 Pandemic halted progress. That said, it has historically been challenging to encourage the widespread use of new freight technology to modernize and improve established freight forwarding processes. This is because such as area of a supply chain is typically controlled by various players, including government organizations.
Although the Pandemic presented many difficulties, it emphasized the critical need to adopt new freight technology into the supply chain management process to minimize future disruptions and enable wiser decision-making. This will ensure that products are delivered to customers at the right location, time, and price. In light of this, here’s how technology is changing the future of freight forwarding.
The Adoption of Blockchain Technology
Blockchain is a much-hyped and frequently misunderstood technology. However, the freight forwarding industry is one of the earliest adopters of blockchain technology, with a significant impact.
An example of such a technology is the launch of a TEU token system by the company 300Cubits, which aims to prevent carriers from overbooking port warehouses and address cargo no-shows. As part of the freight booking process, the system requires both the carrier and shipper to deposit cryptocurrency tokens into an escrow account. Both parties are refunded their tokens if the freight arrives as planned, is loaded, and is dispatched on time.
Introduction of IoT (Internet of Things) Solutions
Another way technology is changing the future of freight forwarding is through IoT solutions. Most shipment tracking processes still rely on electronic message exchanges between parties. However, forwarders can track shipments more accurately as logistics partners start incorporating data from tools like electronic sensors (attached to product packaging or installed in ocean-shipping containers) and the maritime Automatic Identification System (AIS).
Customers can track the condition of their packages and get up-to-date information on the status of their shipments if they have access to this data. This will be especially useful for perishables and other environmentally delicate or fragile items.
Increased Focus on Cybersecurity
A.P. Moller-Maersk, a major global shipping business, was the target of a cyber-attack more than a year ago. It severely disrupted operations at ports worldwide and damaged the company’s infrastructure and reputation as a freight forwarder.
Since the attack, freight forwarders have become vigilant and evolved, moving from antiquated procedures to modern, quick-to-respond digital solutions. The GDPR (General Data Protection Regulation) of the European Union, which went into effect in 2018, has added pressure on them to improve data privacy and security.
So, freight-forwarding companies that are only now beginning their journey toward digitalization will at least be able to deploy new systems with more robust cybersecurity measures. Ultimately, the future of freight forwarding looks more secure than ever!
Wrapping Up
Businesses now have new chances to optimize their logistics operations in creative and profitable ways thanks to the same technology that’s raising customer expectations. However, freight forwarding businesses that are hesitant to change their processes will find themselves outcompeted and outdated as more and more companies become aware of the benefits of technology. Ultimately, the future of freight forwarding is looking bright, thanks to various technological trends!
