Freight forwarder’s everyday life is a lot of tools and low efficiency. Here’s how to do things differently.
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40 e-mails – this is the average number of e-mails a forwarder who organizes a more complex transport has to exchange in order to wrap it up. This means almost two hours of work on one job. Freight forwarders acknowledge that the multitude of tools they use effectively hampers their work. The situation is saved by digital tools, which allow them to work much more efficiently.
Margins are falling. Today, in order to maintain the total margin, the forwarder has to execute many more orders. For example, if he had to close 100 orders to meet his targets, then today it is 120,” says Jacek Słomski, R&D manager at VAN group. “What does that mean? That the processes connected with our work need to be improved and accelerated. And all of this is based on better planning and automation. Binders, papers, handwritten notes – why all this? Today you can get a loan in a bank over the Internet, and many aspects of our work are waiting for similar conveniences. Unfortunately, as an industry we are still a little behind,” he admits.
And practice shows that change is necessary. Because 40 e-mails to close one order are the result of something.
If our work was limited to finding a vehicle and a driver to transport cargo, I would employ 25% fewer people,” says Agata Steczek, head of the forwarding department at Crusar. “But the work of a forwarder is much more than that. We negotiate the terms of the order with the customer, provide support and optimize transport costs by planning or combining loads. With e-mails, phone calls, communicators, GPS. We also monitor transport at every stage – from loading to delivery. We are in constant contact with both the logistics specialist and the carrier, or the driver, and again – often communicating with the use of many tools,” she adds.
Increase in annual revenues by up to 2.5%
But the digital revolution in transport is still quite sluggish. According to the DHL report, business owners are primarily reluctant to digitize their supply chains because they fear that modern technologies are not as reliable as they might seem. As many as 68% of respondents have such fears! In addition, there is also resistance to changes in the organization (65%) and insufficient or long-term returns on investment (64%).
Meanwhile, experts argue that digitization and work automation bring measurable benefits. McKinsey, an advisory firm, has estimated that consistent digitalization of supply chains may result in annual revenue growth of up to 2.5%.
From big data to data sharing
How to achieve such benefits? There are several ways. “According to the respondents, big data analysis is the most important IT solution – 73% of them said that their company invested in this technology. The following places were taken by cloud-based solutions (63%), the Internet of Things (55%), blockchain (51%), machine learning (46%) and the economy of sharing (34%). As far as physical equipment is concerned, 63% of respondents declared that robotics was the most important, ahead of unmanned cars (40%), 3D printing (33%), augmented reality (28%) and drones (27%),” reads the analysis of the aforementioned DHL report.
This is a broader perspective, concerning the handling of the entire supply chain. At the interface between a forwarder and a carrier or freight forwarder and shipper, it is often said that it is necessary to use solutions that would enable quick contact, preferably using just one tool and the widest possible integration of exchanged data.
Digitization in practice – how companies improve processes
In the VAN group, for example, the EDI (Electronic Data Interchange) system was created several years ago. Back then, for the needs of one customer. As Jacek Słomski recalls, it was a ‘very expensive solution’, but at that time the volume and length of the contract made the investment profitable.
Today, such solutions are much cheaper and faster to implement, so we use them on a larger scale. However, unfortunately, we are not able to use their full potential yet. And I’m sure every big shipping company will say the same thing. The integration of our data and those of our carriers or customers is not a major problem. The mentality is the key here. Not every customer or carrier is ready to use these solutions,” explains Słomski.
Even computer simulation of humans work
ROHLIG SUUS Logistics also knows that ‘working exclusively with email and telephone is becoming inefficient and prone to various communication errors’ when all parties involved (i.e. the customer, the forwarder and the carrier) have to constantly exchange information.
Łukasz Włodarczak, international FTL product director, admits that ‘the most vulnerable to the abundance of tools are shippers’.
In addition to several proprietary freight forwarding systems, they also operate on platforms dedicated to contractors and external exchanges,” he admits. “However, there is no single system that would be an alternative and help the shippers. Therefore, awareness of the employer and continuous investment in system integrations that connect and directly transfer data from one side of the transport chain to another are important issues.”
As we have learned, Rohlig Suus Logistics uses the TMS system, which combines all the functions of order registration, fleet planning, reporting and receivables accounting. It also integrates with the systems of contractors.
A very important element in the context of data fragmentation is also the involvement in the development of RPA, i.e. Robotic Process Automation, which we have been working on for a long time at Rohlig Suus. In accordance with the RPA, we isolate the most time-consuming processes, then using algorithms and computer programming we obtain a computer simulation of human work,” adds Łukasz Włodarczak.
With five people, they lost 2.5 hours a day
GTI Logistik, which specializes in transport between Germany, Switzerland, Austria, Italy, France and Scandinavia, is also aware of the need to digitize the forwarder’s work.
We’ve digitized ourselves heavily when it comes to our own fleet. We have optimized our work to such an extent that we carry out an operation virtually all the way from the order assignment to delivery confirmation electronically,” assures Maciej Góralski, CEO of GTI Logistik.
“We invested quite a lot in Soloplan, which relieved the strain on employees who had previously been busy manually entering order data from different media. Now, these data are downloaded automatically, so forwarders can search for carriers, arrange to dispatch and plan vehicles,” he explains.
Of course, we had already worked on the basis of templates before, because many of our orders are repetitive, but still the input of data such as weight, tonnage or route took each employee about half an hour,” he recalls. “With five people, we were losing 2.5 hours a day!”
Further time savings
But this is just the beginning. The company now wants to optimize its cooperation with subcontractors. And it’s a big challenge.
The transport assignment, the processing of the data by TMS, the sending of the order, all this is in a way digitized. The order is generated automatically from the cargo allocation system and then it is sent by e-mail to the subcontractor. But to fine-tune order details or send offers to several subcontractors, it’s all done manually, and in addition, with the use of many different communicators,” admits Maciej Góralski and adds that the company has recently become interested in the TfF solution, which is a tool to automate the entire transport management – from obtaining freight to finding a carrier.
“It’s a solution that goes in the right direction. Yes, the multitude of tools for communication with customers and subcontractors is a specificity of our profession. However, if the so-called ‘procession’ of enquiries for all the details of the order could be reduced slightly by using a single tool, that would allow t the entire cooperation to be supervised with the carriers in one place, it would only work to the advantage,” comments the CEO.
This is about the possibility of limiting the number of communication tools used to maintain contact with the carrier during and after the execution of the order.
It is common today that we have to call the company to find out where their driver is. They are hanging up on us, calling their employee. Then they call us. And sometimes it is necessary to make several such calls because e.g. the driver has no reception. You write text messages… A waste of time on idle work that could be done automatically” adds Góralski. “It would be best if we could use one tool to see the routes of all the vehicles. It would be also great if shippers and customers could have access to it.”
Then the forwarders could save, according to Góralski’s estimates, another half hour a day.
Money saved for new experts
Freight forwarder’s working time connected with searching for cargo and supervising the order execution can be shortened by 15 or even 20%, according to calculations by Paweł Wasiewicz, fleet department manager at Omida Logistics. “This is how much we have estimated the savings from using TfF,” he says. “The automation of processes leads to this. In the age of industry, transport and logistics 4.0., such time savings translate into tangible financial benefits. As much as 10 or 15% of time savings on a monthly or annual basis, considering a six-person unit, means that the company saves money to hire one additional expert who can take care of, for example, acquiring new customers,” says Paweł Wasiewicz.
“The most important thing seems to us to be the automation of filling in the order form, route calculation, and analysis of all events together with notifications of changes. Thanks to this, the data entered once in a given relation will still be available in the system, and it will be possible to modify them only slightly. Therefore, we save time associated with manual input of data and monitoring of cargo in the supply chain,” he explains.
The second thing is the optimization of work through smart route planning. We wanted to be able to automatically receive notifications of subsequent cargoes for carriers, within a certain radius, so that they would not have to drive as far as 100 km from the place where they are,” he adds.
The company also wants to integrate with its own TMS all the telematics systems used by its carriers. “We want several dozen different telematics systems to ‘talk to each other’ in real-time, i.e. to exchange data, so that we do not have to waste time settling kilometres with the carrier, logging in to different telematic systems each time. The map overlay will calculate the optimal route, considering the GVW. The carrier will get access to our platform with access to all orders and details of the routes,” he explains.
Thanks to new technologies, logistics is moving towards full automation and digitization of processes to improve operations for the TSL industry. Using a single system that will enable communication with different platforms (telematics, TMS) will be crucial. If companies from the TSL sector do not switch to this model within a few years, it may be impossible to catch up with competitors,” he concludes.