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Kuehne + Nagel dismisses start-up 'disrupters' junior up-start forwarders

SOFTWARE start-up predictions that forwarders will go out of business in 10 years in the face of digitisation was haughtily dismissed on the second day of the TPM Asia Conference in Shenzen by Kuehne + Nagel vice president Thorsten Meincke.

"There is a limit to what digitalisation can do. Forwarding needs people to manage processes," he said of the predictions made by IT freight start-ups Freightos and Haven CEOs in a panel discussion at the conference the day before.

Said Mr Meincke, representing the world's biggest forwarder: "They are on the way to becoming normal forwarders with nice websites."

Speaking with an irritated tone, he said: "Look at these webpages. They start promising things are impossible. 'Book with us and you can even de-route containers while they are on water.'

"If they can do that once, I will go to every conference and always have an applause for them. You cannot change the routing of a container that is already on the water," said Mr Meincke.

"They create expectations that are away from the market. There are too many technically driven people, who are creating ideas of the market and then venture capitalists jump in.

"When most of them, get their feet on the ground and if they have to get a shipment from Brazil to Australia, they find that they will need someone handling it in Brazil and handling it in Australia. It's very simple - in the end, it is forwarding."

"Only two per cent of customers book online. There are 10 per cent who won't book because they don't like the price," said Mr Meincke.

"Eighty per cent do their bookings in the conventional way because they don't want to fill in the forms.

There is a lot of talk of digitalisation, but the customer wants to have someone do the work and not do the job themselves."

"As for the IT up-start start ups, he said: "I am not frighten at all. This entire quote, book and everything automated may be nice for a start-up company for a shipment once a month, but if you have 20 shipments a day and you have to fill in all the data forms - you want the provider doing it for you.

"We have people who know the market and they are relying on data they have in their minds. They have heard a second a go that APL does not have empty containers at that depot and will immediately take this information and use it in the booking process of the next customer," he said.