Lack of visibility and trust emerge from slower tech adoption in shipping industry – Container xChange survey

In yet another compelling survey, Container xChange has revealed that 84% of the participants still use conventional means of communication to source quotations, while 78% of them use the same outdated processes to place a booking for a slot on the vessel to transport freight. The survey, conducted in partnership with Copenhagen Business School, hints at the fact that even though technology is sweeping swiftly across the global supply chain industry, but for shipping, it still moves at a snail’s pace.

The survey unveils the lack of transparency, visibility and trust, that emerges from relatively slower tech adoption in the shipping industry. To examine the pain points of the current state of ocean freight booking, Container xChange surveyed 137 freight forwarders and NVOCCs spread across the globe.

Key takeaways of the survey include –

  • 84% of the participants still source quotations via email and phone, while 78% of them use the same outdated processes to place a booking. More than 70% of the respondents find a lack of trust in their counterparts
  • Out of all the companies surveyed, 83% ranked digital vessel schedules on an importance level of 4 or 5, while 77% ranked intuitive booking interface in the same way.
  • Industry players also want to have their document checklist and uploads visible and easy to use, as well as operational contact information ready at hand.
  • At the same time, the fact that 60% also use online quotation solutions such as shipping companies’ online booking interface (e.g., Maersk’s platform) shows that a market for digital SOC ocean freight booking exists.

Both freight forwarders and NVOCCs use online quotation solutions, yet their responses depict the need for better digital infrastructure in the future, pointing to digital vessel schedules and intuitive booking interfaces as the most impactful digital transformations in times to come.

“Lack of transparency and standardised digital processes has fuelled inefficiency and mistrust for a very long time in the logistics industry. These struggles are further worse for shipper-owned containers where no carrier takes care of processes. This hinders the adoption of SOCs in the market. The survey corroborates with the state of the industry at present, but it is encouraging to understand how so many players are looking forward to Digital vessel schedules and intuitive booking interface for instance.”

Christian Roeloffs, Co-founder and CEO, Container xChange

Beyond doubt, processes in shipping industry will achieve a level of standardisation with the adoption of digital tools. This will, in turn, increase efficiency as a result of streamlined vessel schedules and intuitive booking process, while avoiding scammers and gaining trust in counterparties with vetted partners.

Compared to Carrier-owned Containers (COC), Shipper-owned Containers (SOC) provide more flexibility and can help users avoid hefty fees like demurrage and detention. However, the market has yet to fully adapt to SOCs in the same way as COCs when it comes to digital solutions. SOCs, being a fairly new concept, don’t have digitised slot booking processes and have a huge opportunity to connect to the fragmented ocean freight marketplace.

When it comes to ocean freight slot booking, SOC users struggle more with getting accurate quotations, and confirmations of available capacity and end up booking with 5-10 shipping or feeder lines since there is no schedule reliability. Whereas COC users do have the liberty of getting administrative tasks like trucking, offloading, unstuffing, and so on taken care of and have digitized slot booking solutions in place, plenty of players still conduct the process manually with loads of emails and phone calls.

Working on digital solutions to streamline the industry pain points, Adrian Degode, Senior Product Engineer, at Container xChange said, “The shipping industry is becoming increasingly digital but the biggest thing missing is trust. The caveat remains to be bringing all the solutions under one platform that simplifies the lifecycle of ocean freight spot booking while ensuring trust and transparency.”

“To enable the industry with an end-to-end solution, Container xChange is building a dynamic Ocean Freight Marketplace with transparent rates and trustworthy partners for Shipper-Owned Containers, where users get guaranteed slots on the vessel and supplier-guaranteed payments. From getting up-to-date vessel schedules and freight rates for your shipping routes to choosing and booking the best offer from trustworthy partners within minutes, the platform will bring a wide array of capabilities.”, he added.

Leave a Reply

Your email address will not be published. Required fields are marked *