News / Forwarders are not your enemy, WCA tells shipping lines

© Dzmitry Ryzhykau |

There is a lot of concern among freight forwarders about how shipping lines in particular have behaved towards them over the past two years, targeting the business of smaller players.

During the pandemic, shipping lines saw smaller forwarders as “the enemy”, according to WCAWorld CEO Dan March, speaking to The Loadstar at Transport Logistic in Munich last week.

“There was a lot of disquiet about the way the shipping lines acted when the rates blew up and they ripped up people’s contracts, acting in a way many forwarders felt was a little unfair to them.

“But the ocean carriers suddenly need those forwarder loads again and the tables have turned,” said Mr March. “There’s more clarity and [forwarders] have leverage.”

Air cargo rates also increased substantially during the period, but the airlines still treated forwarders with respect, he added.

“I feel they still treated the forwarder as a customer in most cases, whereas the shipping lines saw the smaller forwarders as maybe a competitor, an enemy, that they had to try and extinguish and take the direct business themselves,” explained Mr March.

Freight forwarders also made money during the pandemic and there was some consolidation in the sector, but there has not been a reduction in forwarder numbers, he explained, because as companies grew, niche operators were created to handle specialist freight, thus WCA’s membership is still growing at 10% a year.

However, what has really changed for small forwarders is that they no longer rely on rates to make their profit.

“Any forwarder that just makes a difference between a buy and sell rate on ocean is probably going to struggle to be here in ten years, it’s the value-added services that forwarders now offer customers where the future revenue growth will come from,” noted Mr March.