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E-business: threats and opportunities.
Changes in international shipping driven by e-commerce.
New Drewry thought leadership paper investigate the drivers behind the accelerating use of new e-business models and online platforms in international shipping transactions and assesses the implications for freight forwarders, ocean carriers and those investing in the technology and systems enabling this change.
Disruptive new e-business models and innovative online platforms are gaining market traction and changing the way companies buy and transact international shipping services. Whilst no single factor can be identified as being the principal driver behind the trend, both the nature of the spot rate shipping business and e-commerce logistics have encouraged the development of online forwarding.
The paper highlights a number of factors which are contributing to the trend, these include: shippers expecting a more agile supply chain to meet today’s more dynamic “on demand economy” with shorter contracts and spot rate requests, eroding margins in commoditised and fragmented forwarding services make it harder for 3PLs to increases their sales, the rapid growth of cross-border e-commerce is pushing change and innovations and “Millennials” are more comfortable handling activities in a mobile.
New entrants are starting to make an impact and established businesses are either resisting change or adapting. Among the new business models are: online sales platforms, cloud-based freight forwarders, large 3PLs adapting to online business, rate and Data service providers and transport Management System providers, and others.
Large 3PLs adapting to online business are investing in customer portal to gain productivity and reach small shippers. There is confidence among logistics decision makers and freight forwarders about the continuing role of forwarders and 3PLs and some scepticism about new entrants. International freight is not as easy as booking a one-off passenger ticket or hotel, they say.
True, freight forwarding requires trust, orchestration, troubleshooting and functions like customs and compliance remain sensitive, but things will change.
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