In a supply chain world riddled with complexities and poor communication, freight forwarding leaders and businesses continue to clamor for a more connected supply chain. Today, a robust supply chain network involves building a seamless system where all processes and stakeholders are linked through technology and data-sharing solutions.
For freight forwarders, a connected supply chain is top priority as it streamlines processes, allows for better communication, and enhances the end-to-end visibility of the entire operation. Equally important are the financial implications of the shipping process. In traditional supply chains, processes and stakeholders often operated in silos, leading to information gaps that made it difficult to effectively manage the financial aspects of these operations.
These information gaps often lead to mistakes and unforeseen logistics and supply chain risks that, in many cases, will throw the financing of a shipping operation into jeopardy. However, with a connected supply chain, freight forwarders are better positioned to avoid those. In essence, freight forwarders can significantly reduce freight costs , improve cash flow, and boost profitability with a connected ecosystem.
Real-time Data Sharing: The Foundation of a Connected Supply Chain Real-time data sharing is one of the more powerful tools for ensuring a connected supply chain. Through real-time data sharing, every stakeholder and process in the supply chain operation has simultaneous access to relevant information that concerns any stage of the process.Â
So, for example, consider a situation whereby a supplier cannot deliver necessary raw materials on time. Typically, this will impact the downstream manufacturing process. While the impact cannot be avoided entirely, a connected supply chain can help mitigate the damage by ensuring that stakeholders — such as inventory managers, logistics experts, and retailers — are promptly informed. This way, they can reschedule or realign their activities to work together with the new information. If that information changes, they can make the necessary changes on time and more efficiently.Â
The opposite is having each stakeholder discover when it is too late, forcing them to take on losses and disappoint partners to adjust. Here are four reasons real-time data sharing is critical to a connected supply chain, especially where freight forwarders are concerned:
1. Improved Visibility into Shipments and Inventory Levels With real-time data sharing, more stakeholders can track shipments and inventory levels. This means knowing essential information like when it is time to restock and the condition of the shipments, including ETA and likely risks, such as delays. For instance, if inventory levels were impacted due to an unforeseen demand hike, it could drive the supply chain to speed up the shipment process or find alternative solutions.
2. Proactive Identification and Resolution of Disruptions The supply chain can take proactive steps to ensure the entire operation is continuously running by leveraging information gleaned from real-time data sharing. For instance, if there are port congestion or security issues, the freight forwarder can use this information to decide on alternative routes or transportation modes.
3. Enhanced Decision Making Based on Accurate and Timely Information In complex supply chain operations, informed decision-making is crucial and cannot be overstated. It could be the singular difference between the operation’s failure and success. All stakeholders can do this with real-time data sharing because they can access timely and accurate information.
4. Reduced Dwell Times and Demurrage Charges Stakeholders like drayage providers, brokers, and freight forwarders can work together to plan and coordinate the efficient removal of shipments from ports. This will ensure minimal dwell times and potentially eliminate demurrage charges, leading to cost savings and better financial management.
Collaborative Platforms: Fostering Collaboration and Efficiency Collaborative platforms are game changers in the world of supply chain management. This is primarily because they allow businesses to leverage their stakeholders' expertise in planning and coordinating the different aspects of supply chain operations. The enhanced collaboration can lead to increased throughput across operations.
With collaborative platforms, businesses have a centralized hub that breaks down information silos and enhances communication. This way, all stakeholders can rely on each other to coordinate their processes seamlessly.For example, freight forwarders, customs brokers, and drayage providers collaborate to ensure that shipments move efficiently through ports, minimizing unnecessary delays.
Here is how it can impact operations financially:
1. Reduced Cost of Administration and Paperwork. When stakeholders work together, they move as a single unit, meaning there is less administrative jargon and complexity. This also reduces paperwork because all relevant information is transmitted seamlessly between them, including documentation that will help streamline the logistics process.
2. Improved Resource Allocation and Utilization Imagine a freight forwarder allocating resources to ensure shipments arrive safely and are loaded onto a shipping vessel, only to discover afterward that the shipment is not ready or that crucial documentation is missing. With collaborative platforms, that won’t be an issue, and stakeholders do not have to waste resources.
3. Faster Issue Resolution and Dispute Management Stakeholders tend to stretch out and ultimately impact supply chain operations. However, with collaborative platforms, it is easier to see where things go wrong, allowing faster resolution and easier dispute management.
Integrated Communication Tools: Streamlining Information Flow It is one thing to have free-flowing and real-time information, but another to have precise and accurate information. In today’s highly competitive supply chain landscape, it is not an option but a necessity that takes priority. With wrong information, the supply chain is at risk of delays, disruption, higher costs of operation, and bottlenecks that can jeopardize the entire operation.
Integrated communication enhances efficiency and is achievable through logistics and supply chain tech solutions like API. API, for example, allows freight forwarders to seamlessly connect with carriers and easily access their rates and schedules, enhancing their ability to optimize the shipping process for businesses.
Here are some of the financial benefits of integrated communication:
1. Reduced Lead Times and Faster Decision Making Integrated communication reduces the lead time for communication, demands, and order deliveries because stakeholders know what to expect and can make provisions for those demands before they become official. It also allows stakeholders to make better scheduling, manufacturing, buying, and resource allocation decisions.
2. Minimized Misunderstanding and Errors Integrated communication reduces errors stakeholders make across the supply chain, reducing the financial implications that arise from them. For example, negotiating and paying for carrier services when the shipment or its documentation isn’t ready — due to unclear or overlooked communication from the shipper — can be avoided.
3. Enhanced Customer Satisfaction and Loyalty Customers want transparency. With access to integrated communication, they know each step of their delivery and can plan or anticipate accordingly. Even when there are delays, the customers are satisfied with the honesty, reducing anxiety.
Leverage Freightify For a Connected Supply Chain Freightify is a rate management platform providing rate procurement and management solutions that enable freight forwarders and their clients to establish a connected supply chain platform that streamlines operational finances while also optimizing the output. There are two key solutions that Feightify offers that make this a possibility. They are:
1. Cloud Based Platforms These platforms allow access to all sorts of data across the connected supply chain. For example, on Freightify, freight forwarders can procure and manage rates, generate quick quotations, and allow customers to easily track and trace their shipments through the customer portal. This way, there is better communication and much more efficiency across the board.
2. Application Programming Interfaces (APIs) Our API allows hassle-free integration with existing transportation management systems (TMS), customer management systems (CRM), or any other software setup. This way, information flows smoothly and in real time between the various applications, especially between those of the freight forwarder and their clients.
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