In recent years, freight forwarders have started to adopt cloud-based solutions mainly due to the need for innovative solutions in supply chains. In addition, opting for this technological model for companies facilitates access to information, taking into account the immediacy of the real-time data delivery system.
In this article, we have covered the importance of emerging cloud-based logistics solutions for freight forwarders and its benefits into their logistics business.
What is cloud based logistics software?
Cloud-based logistics software refers to online platforms that manage various aspects of the logistics process, such as inventory management, transportation management, order tracking, and warehouse operations, through the use of cloud computing technology. This software enables businesses to streamline their supply chain activities by providing them access to software applications over the internet, without the need for internal infrastructure or hardware.
Implementing logistics solutions with the cloud
Currently, freight forwarders see the need to modernize their supply chain systems to make them more dynamic and thus face the growing demand of consumers in the face of increasingly competitive market conditions
Advances and major changes at the industrial level have motivated manufacturers to seek new alternatives to better plan and deploy their management technology, so having technological services that provide speed to logistics processes is a fundamental factor for modernizing companies and making a difference within the field.
Top challenges faced by freight forwarders
1. Cutting Transportation Costs
Transportation costs are a significant concern for freight forwarders. Rising fuel prices, tolls, and maintenance expenses can drastically affect profitability. Effective strategies to reduce these costs include optimizing routes, consolidating shipments, and negotiating better terms with carriers. Leveraging technology like transportation management systems (TMS) can also provide real-time data to make cost-effective decisions.
2. Business Process Improvement
Streamlining business processes is crucial for increasing efficiency and reducing operational overhead. Many freight forwarders struggle with outdated processes that are not only time-consuming but also prone to errors. Implementing integrated software solutions can automate many routine tasks, from documentation management to billing and compliance checks, thus enhancing overall operational efficiency.
3. Improved Customer Service
In the highly competitive field of freight forwarding, customer service can be a key differentiator. Challenges include ensuring timely deliveries, providing accurate and real-time tracking updates, and handling customer inquiries effectively. Adopting customer relationship management (CRM) tools and enhancing communication channels can help improve service quality and customer satisfaction.
4. Supply Chain Visibility
Gaining complete visibility into the supply chain is essential for effective decision-making and efficient management. However, many freight forwarders face difficulties in tracking shipments across multiple carriers and modes of transport. Implementing cloud-based logistics software that offers end-to-end visibility can help forwarders manage operations more transparently and respond promptly to any disruptions.
5. Managing Inventory
Inventory management remains a complex challenge, particularly for freight forwarders who must keep track of vast amounts of cargo across various locations. Challenges include managing stock levels, optimizing warehouse space, and reducing demurrage and detention costs. Advanced inventory management systems that integrate with other supply chain components can provide the analytics and insights needed to manage inventory effectively.
The benefits that a cloud model can provide to companies are many; however, there are still providers who do not dare to take the initial step, raising questions such as not being completely clear about the specific aspects of this technology, which medium and long term can generate severe costs in your business.
However, to implement solutions in the retail industry, one of the most used services in purchasing processes is cloud computing, occupying the second place of importance behind adopting CRM under the SaaS model (Software as a Service).
5 Best cloud based logistics solution for freight forwarders
1. Freightify
Freightify is specifically designed to streamline the operations of freight forwarders by providing a robust, user-friendly rate management platform. It simplifies the process of managing, quoting, and tracking freight rates, making it easier for forwarders to offer competitive services.
Key Features:
- Automated rate procurement that allows quick access to the best shipping rates from a variety of carriers.
- Real-time tracking that provides updates on shipments and helps manage schedules effectively.
- Seamless integration with existing systems, ensuring that Freightify works in conjunction with other business management tools.
- Customizable and branded client portals that allow freight forwarders to offer tailored services to their clients.
2. Flexport
Flexport combines advanced technology and infrastructure for logistics and supply chain management, serving both small businesses and large enterprises. It is renowned for its end-to-end management capabilities which provide greater transparency and control over the shipping process.
Key Features:
- Comprehensive dashboard that offers visibility across all freight operations, helping businesses track and manage shipments in real-time.
- Advanced analytics for assessing logistics performance and making data-driven decisions.
- Robust integration options that connect with various transportation methods and logistical services seamlessly.
3. Kuebix
Kuebix offers a modular, scalable transportation management system that caters to businesses of all sizes. It provides a wide range of functionalities that can optimize the supply chain and improve collaboration between shippers and carriers.
Key Features:
- Access to Kuebix Community Load Match to connect with shipping partners without the need for extensive networking.
- Ability to manage all modes of transportation in one platform, including parcel, LTL, FTL, and rail.
- Advanced analytics dashboard that helps businesses optimize their shipping strategies and reduce costs.
4. Descartes
Descartes is known for its global logistics network and solutions that focus on improving the productivity, performance, and security of logistics-intensive businesses. Its software solutions are geared towards making logistics operations more efficient and reliable.
Key Features:
- Real-time route planning and scheduling to optimize delivery times and reduce operational costs.
- Comprehensive compliance solutions that help manage customs and regulatory requirements effectively.
- Integration capabilities that enable real-time communication and data exchange across the supply chain.
5. ShipBob
ShipBob is a cloud-based logistics platform designed for e-commerce businesses, providing warehousing solutions and streamlined fulfillment services. It is ideal for companies looking to scale their operations and improve delivery times.
Key Features:
- Distributed inventory management that allows users to store products closer to customers, thereby reducing shipping costs and times.
- Direct integration with e-commerce platforms like Shopify, BigCommerce, and Magento, making it easier to manage orders and inventory in one place.
- Detailed data and analytics provide insights into shipping performance, inventory levels, and order management.
Cloud computing and SaaS: inclusive and non-exclusive services
One of the biggest problems for logistics executives when deciding whether to implement a service in the cloud for their processes is identifying the characteristics of its different components, applications, and associated services.
The SaaS (Software as a Service) model is one of the components directly related to “in the cloud” processes. In this type of software, consumers can access Internet applications hosted in the cloud, having a wide range of tasks at their disposal.
Users can count on the services through any Internet-enabled device. This software model allows companies to serve with the maintenance, support, and operation that the client will use when the service is contracted.
The benefits of having a SaaS service are that companies can use the applications for various needs, including accounting and billing, sales tracking, planning, performance monitoring, and communications, including webmail and instant messaging.
Therefore, the SaaS service is one of the three categories within cloud computing. It translates as how the service is paid in the cloud, making it an inclusive complement when acquiring technology services online.
These are the three categories of cloud services:
- SaaS applications have been designed for end-users, with information delivered in real-time over the Internet.
- PaaS (Platform as a Service) is the set of tools and services designed to make the coding and implementation of these applications quickly and efficiently.
- IaaS (Infrastructure as a Service) is the hardware and software that manages everything from servers, storage, and networks to companies' operating systems.
In other words, the difference between SaaS and cloud computing is that the latter is aimed at software developers, application providers, savvy computer users, and corporate IT departments, not for people who use computer applications, in this case, the Service Software (SaaS).
The rapid growth of SaaS services will soon become a common goal within each organization. Therefore, buyers and users of this technology must understand why and when it is appropriate to use it
SaaS in the monitoring of freight dispatches
The management systems used by freight forwarders are presented as multimodal and intelligent software solutions capable of processing all activities air, sea, land, and customs with the maximum levels of efficiency and profitability. From quotes up to invoices, the entire shipping cycle can be optimized in a single system, generating an intelligent workflow based on best practices.
Why is it important to have a SaaS service in logistics operations? Because the level of service of a distribution operation is directly related to the operation’s expense and efficiency, it is the logistics management’s responsibility to find the balance point between management costs and the appropriate level of service.
Last-mile delivery services are a small part of most supply chains. However, it is the only instance in which the client has direct contact with the company, generating brand visibility. For the same reason, it is essential to have a tracking service capable of reporting each dispatch process in real-time.
Many consumers have indicated that excellent service in dispatch deliveries is critical when making new purchasing decisions. Approximately 33% of consumers have stated that they would switch to another brand if they have a bad or negative experience in delivery processes.
Plenty of dedicated cloud-based freight forwarding solutions (SaaS) allow freight forwarders to answer forms, track cargo, optimize routes and notifications via email and SMS to customers minutes before executing a delivery. It is even possible to take photographs and digital signatures when making the delivery operation. These steps provide a notable decrease in the levels of uncertainty in the processes.
In companies, cost reduction becomes increasingly complex, but increasing the value of the product through an improvement in the quality of the service is much more profitable and more difficult to imitate for the competition, adding a fundamental brand value and making it much more attractive to your customers.
What is Cloud Computing?Â
It is the massive storage of data, information, and web services processed through a server connected to the internet. With this type of service, software solutions can be purchased and installed internally or transferred to an external provider that stores them on their servers.
Cloud computing provides a fast, flexible and accessible model for companies of any size that dare to opt for specialized services, providing efficient solutions to the requirements of each firm, with immediate and in-depth response time. Big companies like Microsoft, Google, or Amazon are already providing the infrastructure required for these services, specifically considering the needs of the logistics industry.
Companies that use the cloud computing model can currently count on the benefits of a group of IT specialists who provide excellent services for each company’s business, becoming great experts when delivering specific solutions.
Cloud services for freight forwarders(eg. Freightify)offer access to a flexible and configurable selection on demand of what each company is willing to pay for the service it requires, with orders management, billing, event, and process monitoring solutions.
Another benefit of having a cloud computing system in logistics is that providers will not have to invest in the infrastructure of a specific IT staff for their company, nor will they have to be concerned about the correct implementation and maintenance of improvements which would imply a significant capital investment.
Cloud computing came to delegate IT responsibilities to a "cloud logistics operator,” who manages the different tasks of the systems, leaving companies free of this work and allowing them to focus their efforts on the business.
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