Against the odds: Transpac ocean rankings – Flexport smashes it
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In an environment where digitisation and tech-based solutions have become regular fixtures, the alignment of two tech-based logistics players is bound to create ripples.
The news that Flexport and Convoy have formed a strategic partnership to create end-to-end shipment automation has competitors trying to figure out how compelling that looks to their clients.
Flexport, a tech-based forwarder, and Convoy, an online brokerage platform, will align international air and ocean cargo logistics, with the surface part in the US for automated end-to-end pricing and booking functionality.
This will allow shippers to book the surface part of shipments to the US on Flexport’s platform, as well as the international leg, and track them all the way. In essence, it links separate processes historically handled by different entities into one platform.
Flexport told the Loadstar: “Our joint strategy is anchored in driving out manual work and reducing the friction attached to managing international and domestic shipping for our clients.”
CEO and founder Ryan Petersen added: “This represents a shift in the logistics ecosystem, fuelled by an increase in collaboration and visibility, thanks to technology.”
“This partnership advances a vision long shared by Convoy and Flexport that technology will create efficiencies and bring flexibility to the supply chain,” said Dan Lewis, CEO and co-founder of Convoy.
However, for shippers the selection of trucker to move their goods in the destination country to their destination has been left to their logistics providers and/or their overseas partners. Why would they be bothered with the choice of trucker in the US?
According to Flexport and Convoy, giving shippers access to trucker pricing information on the Convoy platform provides them with a better picture of landed cost. Moreover, Flexport has argued that the combination of ocean and domestic transport allows economies of scale that reduce the two intermediaries’ costs that should result in cost reductions for shippers.
“The immediate gains will be for shippers that are mutual customers of Flexport and Convoy,” said Michael Johnson, EVP of strategy at logistics platform provider Redwood Logistics. “This is about visibility and some turnkey execution.”
Flexport and Convoy have been collaborating since 2018, when Flexport adopted Convoy’s self-serve shipper platform for transactional freight, but the new partnership elevates their co-operation from a transactional to a strategic level, they claim.
Mr Johnson regards the alignment as a harbinger of more strategic partnerships where technology will play a large role.
“We’re going to see more collaboration, and more partnerships like this,” he predicted, adding that all partners in the supply chain should benefit from this.”