Carriers vs forwarders – who is going to represent forwarders' interests in carriers' blockchain plans?
The “ocean carriers vs freight forwarders” debate rumbles on. This week I talked to Steve Walker ...
Freight forwarders offering supply chain solutions to shippers should have nothing to fear from Maersk’s ambition to be the “UPS of container shipping”.
So said Maersk Line chief executive Soren Skou, speaking at this week’s TPM conference in Long Beach.
He said: “Freight forwarders make up 40-45% of our business and I don’t see that changing – the most important thing for freight forwarders is to have the best service at the lowest possible cost.
“I do think that if all a freight forwarder provides is just a booking service then they will have a hard time, but if they offer more it’s completely different.
“If BCOs [beneficial cargo owners] want to book with us, that’s fine; if they want to use a freight forwarder, that is also fine – we don’t segment our customers.
“A freight forwarder can book with any carrier, but when you deal with us you get a one-stop shop,” he said, although he later admitted that carriers would always struggle to offer the level of service to smaller shippers that forwarders could.
“All carriers have said over the last 25 years that freight forwarders should service SMEs, we simply don’t have enough people – although today, everyone can make a booking online.”
He claimed Maersk Line had made genuinely quantifiable improvements to its level of customer service over the past few years.
“When I became chief executive, the company was in a completely difference place – we were the largest carrier, but we were nowhere near being the most profitable, because of our cost base.
“We aimed to become more profitable and, after three or four years of focusing on our costs, it was clear that our customers were not happy, and it was time to focus on that,” he said.
In 2013, Mr Skou addressed that year’s TPM when he made a number of promises to improve service levels, including reducing the time it took for Maersk to confirm a booking, from the then average of nearly three hours, to under two hours.
“Today we are well below one hour, and are moving towards instant booking confirmation – we expect this to happen before the end of the first half of this year. For standard dry boxes – it may well take longer for cargo such as hazardous goods – it will be like booking an airline ticket.
“And to be honest, I don’t think that will be anything out of the ordinary. I expect this to be standard in the industry,” he added.
On merger and acquisition activity in the industry, Mr Skou said although he expected further consolidation among the carriers, “we have quite enough on our plate” with the integration of Hamburg Süd, and “we won’t acquire railroads or trucking companies and are not looking at Panalpina”.
However, Maersk could well look to beef up its supply chain services, in a manner similar to the recent acquisition of US customs broker Vandergrift.
“The focus of our acquisitions will be in supply chain management,” he said, “helping customers manage their purchase orders at the point of origin; that’s an interesting area.”