The shape of the shipping industry is changing constantly as the future of the global economy is shifting. Different industry players and freight forwarders are accommodating these changes as they come. Technology, global trade, and a changing job market are some factors contributing to some of the challenges.
What Are the Major Challenges Freight Forwarders Face Today?
Whether your supply chain depends on ocean shipping or moving your cargo via air freight companies, you likely are using freight forwarding services at some point. These companies organize, consolidate, and ship cargo using air, ocean, rail, and land shipping. However, recent economic, environmental, technological and political changes are keeping this industry in flux.
1. Fuel Costs
Rising fuel costs heavily affect the shipping industry. Drayage shipping practices help manage and lower fuel costs by optimizing travel and transport, but fuel accounts for a large portion of the industry’s overall cost. Finding new ways to streamline this process, optimize travel routes, and reduce fuel costs is one of the industry’s biggest challenges.
In addition, fuel alternatives are being explored, offering more optimal solutions for the future. Some of these include electric or hydrogen-powered vehicles. However, these alternatives will heavily rely on the infrastructure for electric trucks, which may be a few years ahead of us.
2. Environmental Issues
The shipping industry experiences an array of environmental issues, from fuel emissions to oil spills to wildlife interactions. All transport vehicles rely on burning fuels, mostly diesel, which release a number of harmful chemicals in the air. Because of the volume of such an industry, this produces a lot of pollution.
In addition to air pollution, oil spills can affect oceans and wildlife. Maintaining effective and affordable shipping practices that lower pollution is a huge challenge the shipping industry is facing.
3. Customer Service
The nature of the shipping industry involves a number of different global shipping partners working in tandem to move cargo. This does not always result in the best customer service for the shipper, as a lot can often get lost in translation when dealing with foreign shipping partners.
It is important for freight forwarders to ensure that their partners share with them accurate and timely information in order for them to provide excellent customer service. Good customer service can be quite a differentiating factor between companies. Customers want transparency and shipping companies will constantly be adapting to provide the best.
4. Driver Shortage and Retention
Freight forwarders rely heavily on the trucking industry to move cargo between intermodal drayage points. While short-haul and drayage shipping reduces the need for long-haul truck drivers, there is still quite a shortage of drivers.
Most drivers have been in the industry for many years and are retiring, or do not keep the job for very long. Trucking companies have moved to make the job more attractive to younger people, women, and ex-military personnel. The trucking labor force is a large factor in the way the shipping industry works.
5. Technology Implementation
The use of technology in the shipping industry is changing rapidly, to accommodate the above considerations and more. The quick rate of change, however, makes it more difficult to incorporate fully into a standardized process.
Freight forwarders use advanced communication, optimization, and tracking tools to manage and move cargo globally. Electric vehicles, advanced tracking systems, and supply chain visibility are some of the issues technology are currently addressing.
6. Government and International Regulation
When moving cargo between different countries, shipments are subject to local rules, laws, fees, and regulations. However, depending on where the shipment is being processed these rules may not be the same, or easy to understand. They can change day by day, and it’s important for freight forwarders to be aware of all current shipping practices.
7. Global Economy
The global economy is shifting drastically, and freight forwarders must take precautions to work around inflation, rising shipping costs, trade wars, and environmental factors. It is important to guarantee the reliability of the supply chain, even in the face of global change. Freight forwarders and shipping companies are looking ahead to solve such future problems.
The world is rapidly changing, and in order to ship cargo, we have to keep up. At Asiana USA, we employ forward-thinking policies and plans of action to ensure that our partners can continue to do business uninterrupted. We seek to provide great customer service and innovative solutions to some of the challenges faced in the industry. Call Asiana USA at 855-500-1808 today to get a quote.