How E-Commerce Is Changing the Freight Forwarding Industry
E-commerce has revolutionised shopping.
It’s incredibly time-saving because customers no longer need to visit brick-and-mortar stores to buy goods. It has also increased the demand for most products, putting pressure on the freight forwarding industry.
This article will discuss how e-commerce is impacting freight forwarding. We’ll cover the changes in the structure of this industry and some of the best practices going forward.
What Is E-Commerce Freight Forwarding?
Coordinating the transportation of raw or processed goods and finished merchandise across borders is known as freight forwarding. E-commerce companies sourcing products and supplies from overseas cooperate with these providers in many integrated ways to streamline the manufacturing and shipment processes. They enable brands to move their offerings faster, which is paramount now that e-commerce has skyrocketed the demand for certain items.
Many people turn to freight forwarding to optimise their business. For instance, you might be wondering, “How does e-commerce reduce shipping costs?” The answer lies in the very nature of freight forwarding.
Once someone hires your freight forwarding company, they can store products in your warehouses and transport them from locations closer to their clients. This can dramatically lower the shipping price when multiplying the cost savings across all orders.
How Digitisation and Е-Commerce Are Reshaping Freight Forwarding
To make the most of your freight forwarding services, you first need to understand the following aspects:
- The impact of e-commerce on freight forwarding and logistics
- How e-commerce is impacting the air freight shipping industry
- How has e-commerce impacted the management of transportation?
The most significant factor of e-commerce that’s reshaping the freight forwarding industry might be consumer demand. There are more shoppers than ever, making speed and price two priorities for e-commerce companies. Retailers must strike a balance between minimal transportation costs and higher shipping speeds. For instance, some customers need same-day delivery, whereas others need free transportation. Plus, many customers may decide to obtain their products from physical stores or receive them at pickup lockers.
Freight forwarders must be aware of these requirements. You need to tailor your services to your customers. As a result, their business can have fewer disruptions, and their clients are more likely to receive products on time and at preferred locations.
Another factor that’s changing freight forwarding is returned. More specifically, customers are looking for a seamless return experience, which requires logistic providers to reverse their usual delivery process. As more e-commerce products are returned due to the sheer traffic, companies that don’t streamline the process risks losing their customers to the competition. Freight forwarders play a key role in this relationship.
When discussing the impact of e-commerce on freight transportation, all these considerations warrant new goals and standards for freight forwarding providers:
- On-time delivery
- Supply chain transparency
- Improved inventory capacity
- Optimised order management, tracking, and customer communication
- Reduced fuel consumption
- Smooth return process
You also need to consider the changes to the structure of the freight forwarding process when answering, how has e-commerce impacted the management of transportation? Some companies may need to reevaluate their organisation by adjusting their supply chain.
Here are some of the elements your supply chain can implement to meet growing e-commerce demands:
- Cutting-edge technology – Technology is vital to increasing supply chain efficiency in the freight forwarding industry. In particular, you need a robust transport management program to take your services to the next level. This software lets shoppers track orders, receive exact quotes, send confirmations, provide freight invoices, and offer bills of lading. Some platforms also have data analysis, delivery history, and custom reports to advance your operations.
- E-fulfillment hubs – Your customers should be able to stock merchandise in your warehouses and pick them up whenever their clients place their orders. The premises should be available to them 24/7.
- Sorting and parcel centres – After picking up and packing orders, your customers should have the ability to sort the products for distribution. That’s where sorting centres come in. They allow your clients to save money, which increases their satisfaction.
- Last-mile distribution sites – You should move your last-mile distribution sites as close as possible to your customers’ delivery locations. This is essential for lowering fuel costs and speeding up operations.
Best Practices for Responding to E-Commerce Demands in Freight Forwarding
Now that you know how digitisation and e-commerce are reshaping freight forwarding, let’s see what you can do to respond to these changes.
Consider relying less on outdated methods of faxing and phoning for booking shipments. You need to automate the processes by developing or integrating sophisticated software. It enables your clients to schedule services and plug-in transportation data with ease.
Optimise Shipping Routes
One of the most important roles of freight forwards is to find the best shipping routes. It’s even more significant nowadays due to growing e-commerce demands. You can leverage various transportation management programs to select the ideal pathway using the data collected through the software. It lets you compare statistics, volume, and pricing to determine the most cost-efficient option.
Take Warehousing Management to the Next Level
As e-commerce customers process a large inventory, you should expand your warehousing capacities to accommodate them. Make sure your clients can store their items efficiently and utilise effective sorting methods. Furthermore, provide a tracking system that helps design the optimal shipping route.
Enhance Reverse Logistics
Returning products can be challenging for all parties involved. Your e-commerce customers expect you to provide hassle-free methods of reverse logistics. This way, they’ll be able to refurbish the items and resell them more quickly, resulting in tremendous cost savings. Again, use your transportation management platform to monitor customer demands and critical performance metrics to enhance your services in this respect.
Facilitate Cross-Border Shipping
Expedited shipping is critical. The last thing you want is to lose your clients due to a slow customs process caused by your lack of preparation. To accelerate the process, outsource the work to customs brokerage services. They can speed up the procedure to minimise cargo delays and the fees associated with the hold-ups.
Proactive Freight Forwarding
Knowing how e-commerce is impacting freight forwarding is the first step to polishing your operations. You now need to analyse your customer and supply chain relationships to identify systemic weaknesses. Once you recognise an area that needs improving, implement the above tips to stay ahead of your competition.
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