The future of the freight forwarding industry rests on the ability to provide Vertical Services, according to experts speaking at an international conference at the Supply Chain Academy in the UK in September, which was attended by International Cargo Express Managing Director Ronald Spahr.
The Supply Chain Academy was established by ICE’s UK-based agency, Uniserve, to educate forwarders and customers alike on developments in the industry. Almost 20 freight forwarding agents from around the world, from Canada to Bangladesh, attended the conference.
The conference was told that European freight forwarders are increasingly dealing with companies looking for ways to offer greater benefits to the customer. As a result, the industry is now steering away from transactional relationships, which are highly competitive but offer no real benefits either to the forwarder or the customer.
Transactional Vs Vertical
A transactional relationship relates to a basic import or export deal, with revenue earned only through the transportation of cargo. Competition in that arena is so acute that the difference between deals is often only a few dollars.
Vertical services relate to the freight forwarder going beyond the scope of the traditional transactional relationship, incorporating aspects that effectively mean handling the entire supply chain system so as to offer solutions to any issues that may crop up.
The principal benefit to the customer is that costs are reduced because the whole range of tasks involved is kept in the hand of one service provider. A secondary advantage is that the service can run more efficiently since there is no need for complex collaboration or integration agreements between two or more interested parties – one company takes care of it all.
“Offering Vertical Services means offering more entrenched services that help to streamline the importation and exportation procedures,” explains ICE Managing Director Ronald Spahr. “This can be provided by checking on a customer’s entire supply chain system, identifying any hiccups that may exist and offering a solution that improves it.”
ICE Already Positioned For Change
According to Mr. Spahr, International Cargo Express is already well positioned to develop its own dedicated Vertical Service.
“ICE already works closely with customers, sharing our expertise and knowledge to ensure our customers enjoy the maximum benefits and savings. It means we can easily be subcontracted to do the functions that many customers traditionally arrange at a significant cost in-house. This is because most of those functions are replicated in our own existing services. We already know that this is where the big savings are for our customers.”
For more information on Vertical Services from International Cargo Express, simply contact the ICE Team. We’d be glad to address any queries you have.
