Will the digital revolution kill off forwarders?
Digital disruptors will no more kill-off today’s forwarding sector than the advent of European rail did in the 1800s, according to director general of the British International Freight Association (BIFA), Robert Keen.
This week he described comments from one industry disrupter that with digitalisation accelerating globally as a result of COVID-19, it believes the future of the traditional freight forwarder is more precarious than ever as PR puff. Over the last five years I have read reports that suggest the rise of software start-ups spelled the end for forwarders. I feel like Bill Murray in Groundhog Day.
“There’s this idea that if forwarders do not adapt, they will die – but you just need to look back at the sector’s history, it has always adapted.
“One forwarder I know – a family-owned European firm – has in their archive a letter from a great-grandparent proclaiming the company’s demise with the arrival of rail in the mid-1800s… it’s still going strong.
“We keep hearing the usual spin from digital start-ups on how their presence in the sector will lead to the death of traditional forwarders,” said Mr Keen. “It’s a load of rubbish. We have strong empirical evidence showing what [our members] are up to in regards to digital transformation of their role in the supply chain.
“BIFA members are already developing and delivering technology-led products and services that will meet their customers needs more effectively, enhance their experience and cut their costs.
He added that what “really irritates” him is software providers “preaching” about systems that will kill forwarders, without recognising that forwarders are already using a lot of them.
Defending forwarders tarred as having a reputation as technology laggards, Mr Keen said forwarders were “incredibly adaptive”, saying that there is evidence daily of freight forwarders developing systems comparable with those of digital disruptors.
“A company I visited recently is developing its own integrated solutions,” he said. “They’re not only hiring forwarders, but software development staff – and our members large and small are making a fantastic effort to embed themselves in their customers’ entire supply chains.”
Mr Keen agreed that there is significant change on the way, but believes that forwarders will be part of an industry-wide global solution to the digitisation process.
“We do foresee a different outlook in the years to come, and there will be changes,” he added. “But I’m certain there will still be a BIFA, with a healthy membership of freight forwarding companies, in 10 years’ time.”