Although freight forwarding operations seem straightforward on paper, they involve many nuances in managing processes and stakeholders, especially those of an external nature. These nuances and the coordination of the various processes complicate the operation.
What are Supply Chain System Integrators, and How Do They Work? Supply chain system integrators are entities — organizations, technology, or people — that assess the entire supply chain or its components. They identify unique ways for various processes, tech solutions, and stakeholders to work together seamlessly, enhancing the overall planning process. These solutions must ensure the different aspects of the process can cooperate in the most efficient manner possible while improving the supply chain's throughput.
In the case of freight forwarding, the process is similar but with a key distinction: freight forwarders are external stakeholders managing multiple supply chains simultaneously. This requires supply chain system integrators to find solutions enabling freight forwarders to operate efficiently across several supply chains simultaneously. They must ensure that freight forwarders can coordinate and execute various logistics and shipping processes in parallel, without disrupting the performance or flow of any individual supply chain.
Benefits of Using Integrated Logistics In a world where logistics operations are increasingly complicated because of the various aspects that must be coordinated efficiently for success, integrated logistics provides businesses, especially freight forwarders, with the ability to manage all of these aspects together under one platform. This can improve the effectiveness and efficiency of the entire logistics operation.
Here are a couple of reasons why freight forwarders are increasingly clamoring for it:
1. Overcoming The Limitations of Traditional Supply Chain Logistics is not a new phenomenon, but technology has optimized the entire operation, making it much more productive. However, even that has some limitations, which is why integrated logistics is so important. It can effectively channel and harness technology's power to overcome traditional supply chains' limitations, such as lack of visibility, expensive, and poor communication of the entire logistics process.
2. Achieve Faster and More Efficient Operations Integrated logistics advances a much faster yet more efficient operation by ensuring each logistics process is in sync and working with the various influences or forces across the supply chain process. Take, for example, coordinating with the shipping lines, brokers, drayage providers, and warehouse facilities. This way, the shipment can move seamlessly through the ports without obstacles. It can also sync with the various solutions, enhancing communication.
How Supply Chain System Integrators Streamline Freight Forwarding Operations Supply chain system integrators play a significant role in streamlining the freight forwarding operation because of their ability to completely sync and coordinate all processes and solutions for a more robust yet simplified process. Here is how it achieves this:
1. Integration of Disparate Systems The freight forwarding process entails various disparate systems, such as warehouse management systems (WMS), transportation management systems (TMS) , and enterprise resource planning (ERP) systems. Different stakeholders leverage these across the various stages of the freight forwarding operation.
By integrating them into one unified platform, supply chain system integrators can enable seamless data exchange, reducing errors and manual intervention. For example, when a business creates a freight order in the ERP, other solutions, such as TMS and WMS, are alerted, and stakeholders can take relevant action. All of which leads to a faster and more cohesive operation.
2. Process Automation Automation enhances seamless coordination of different parts of the supply chain or business operation. System integrators leverage automation to eliminate manual tasks that slow down this coordination, including data entry, shipment booking, document generation, and invoicing.
Automation is significant because it enables faster processing or order while eliminating errors, delays, and excess administrative burden on critical tasks, such as documentation. For example, streamlined document sharing with the customs authorities during the shipping process ensures shipments are cleared as quickly as possible.
3. Improved Visibility and Tracking Supply chain system integrators offer end-to-end visibility across the supply chain by integrating real-time tracking systems like GPS and RFID into the freight forwarding process. This way, freight forwarders and their clients can seamlessly monitor the location and condition of goods in transit.
Advanced dashboards aggregate data from multiple transport providers, allowing managers to make quick decisions based on real-time insights. This transparency also improves customer satisfaction as clients can receive up-to-date information on the status of their shipments.
4. Data-Driven Decision Making By leveraging data and advanced analytics, system integrators can create a loop of insights that can help freight forwarders optimize their operations. The loop or system pulls data from various integrated systems, creating a holistic view of the operation.
Freight forwarders can analyze the data to uncover inefficiencies throughout their operations, predict future demand, and optimize routes and loads. Machine learning algorithms might be applied to predict delays, recommend faster shipping lanes, or even optimize carrier selection based on cost and performance data.
5. Optimized Routing and Load Planning Freight forwarding entails complex decision-making involving shipping route optimization, leveraging the right mode of transportation, and optimizing the load. System integrators can leverage advanced algorithms and analytics tools to recommend the most efficient approach to optimizing these.
The optimization will consider fuel costs, carrier performance, traffic conditions, and shipment legacy, helping freight-forwarding businesses reduce transportation costs and minimize environmental impact.
6. Customs Compliance and Regulatory Integration Freight forwarders have to navigate numerous challenging regulations that are nuanced but necessary. However, this process can be time-consuming and can significantly impact the movement of shipments from the carriers through the ports to the warehouse or other modes of transportation.
Customs clearance is often one of the most time-consuming steps in the freight forwarding process. However, system integrators can streamline this by incorporating regulatory and compliance software that automates the preparation and submission of customs documentation. This way, proper documents are submitted to the relevant authorities, reducing delays and helping businesses avoid penalties due to non-compliance. Moreover, integrating tariff classifications and trade agreements can reduce duties and taxes.
7. Stakeholder Collaboration Freight forwarding is about playing the intermediary between multiple stakeholders and processes, including suppliers, carriers, customs agents, and consignees. Supply chain system integrators can enhance collaboration by providing a centralized platform where all stakeholders can share real-time information, documents, and updates.
The collaborative platform can foster quicker problem resolutions and smoother transitions between different phases of the freight process. For instance, sending alerts on shipment movement will allow stakeholders to operate proactively, reducing disruptions if a delay occurs during transport.
8. Enhanced Scalability and Flexibility Systems integrators offer modular solutions that enable freight forwarders to easily scale. Whether the freight forwarder needs to expand into new regions or add new modes of transport, these integrated systems can be quickly adapted to support additional complexity. This flexibility ensures the system can accommodate market changes, such as increased shipment volumes, regulation changes, or new business models.
9. Risk Management Freight forwarding comes with many risks. These risks can devastate supply chain operations, whether it’s geopolitical instability, extreme weather, or sudden shifts in market conditions. However, supply chain integrators can deploy risk management systems that assess and mitigate these risks. They help freight forwarders identify and mitigate potential risks in their supply chains, such as delays, disruptions, or damage to goods.
10. Cost Reduction and Improved Efficiency By integrating systems, automating processes, optimizing routes, and enhancing collaboration, SCSIs help freight forwarders achieve significant cost savings and improved shipping efficiency . This translates into better profit margins and a stronger competitive position in the market.
Investing in the Right Supply Chain System Integrators Choosing the right supply chain system integrator can significantly enhance freight operations, but finding the ‘one’ can be challenging. That’s where Freightify comes in. Our rate management system can easily integrate with your existing systems, including Enterprise Resource Planning (ERP), Customer Relationship Management (CRM), Transportation Management System (TMS). Experience seamless compatibility and enhanced efficiency. Schedule a demo today to see how we can make your operations more efficient.
