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Forwarders need to embrace the digital age to maintain a role in supply chain

EXECUTIVE director of the Canadian International Freight Forwarders Association (CIFFA) Ruth Snowden has warned forwarders who fear digital transformation that they will not be able to compete in a rapidly evolving market.

"Despite the benefits, there is a fear among traditional forwarders of a threat to their business from digitisation and the transparency it brings. To be frank, those that fear to compete in a transparent market probably cannot compete and should get out of the industry," Ms Snowden told delegates attending The International Air Cargo Association's (TIACA) executive summit in Miami, reported The Loadstar, UK.

Ms Snowden said the idea that all forwarders did was input data was nonsense - their focus was shipment optimisation and carrier selection based on industry knowledge.

She also said that forwarders who fail to offer value-added services were not likely to survive in the long run.

"The margins involved in air freight are simply too low for forwarders to pay people that do not provide any sort of added-value product.

"They have to have a set of core competencies and industry knowledge sought by shippers, with digitisation supplementing this through data provision, when it is needed and to those that need it," she said.

IATA global head of cargo Glyn Hughes compared the role of forwarders in the modern economy with travel agents.

"You have online portals that provide flight costs in a transparent, open way, but you still have travel agents that bring the added value," Mr Hughes was quoted as saying.

Chief executive of digital forwarder Twills Logistics, Troels Stovring, added: "Technology should not be seen as a disruptive influence on the industry, but rather an enabler that moves things forward," he said.

"It enables information and data flow but does not remove people. Forwarders still need boots on the ground, digitisation just frees them from rudimentary tasks."