Leading Dutch shippers are supposed to launch a web-portal for direct booking with airlines (As per an article in Aircargo News, No 670, Feb 12., 2010.)

Implementing the system will give power of the users to bypass the forwarders for routine shipments. This model is taken from the budget airlines which have surpassed the travel agencies.

I am wondering it happens now and not earlier and what amazes me is the reaction of the forwarders. Mr. Roland Bischoff from K&N has stated that the airlines risk a boycott if they support this model. Absolutely anti-market in some countries even un-lawful.

Now let’s look at the situation from another view point:

1. Obviously customers accept forwarders as a mere intermediary which is adding more cost than value. Especially with the standard airport-to-airport shipments.

2. The economic hurricane which swept over the world pressed companies to cut their cost. Straightly ! Without any fancy wording like cost restructuring or cost optimization. One of the first items which has been influenced was the transportation.

3. The advanced technology now allows the customers to interact more directly with the carriers and not to use the services of the cargo agents or to use only part of them not everything.

All these three factors give us clear picture of what has powered the decision of the Dutch shippers.

Of course there will be issues like – who will process shipments and how it will be processed before being delivered to the airline, but … let’s put it straight . This issues are not hard to solve:

- pick-up and deliveries can be done from local companies specialized in this area or by shippers themselves.
- documentation handling – the move is towards paperelss handling of the documentation. Customs processing is automated and IATA has started the e-Freight project. It is a matter of time all the documentation to be handled paperless.

So the integration of all activities, now can be easily shifted to the shipper’s side or to the specialized companies who will place more importance to the integration itself rather than to the forwarder’s commission.

My personal view is that the forwarding industry in its classical role is leaving the scene. Well, not immediately but the signs are clear. And what shall we do as forwarders (instead of declaring boycotts):

Firstly, we must recognize that there is this process of shift and that the customers do not anticipate us as partners but much more as intermediaries .

Secondly, We must re-think what actually the forwarding service is in this new economical situation influenced by technological opporutinities . And how it is changed at the moment. May be 3PL’s will be substituted by 4PL’s and accent will shift from cost competition to real service level competition – which is not the situation in the moment.

Third, we must provide transparent systems for interaction with the customers. How many of you have systems where customers, can place their orders and view there development and movement status?

Forth, we must become more proactive in the net where our customers are.

Fifth we must leave from the role of the intermediary and step in the role of our customers partner and solution provider – just like the SSF.

If we do not do this, carriers and other service providers will surely do it and we will be kicked out of the stage. Indisputably!

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This post was submitted by Georgi Stoilov.

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