Top 5 Trends in Digital Freight Forwarding

Innovations driven by (artificial intelligence and big data) pave the way for businesses in digital freight forwarding into a new era of efficiency and precision
February 23, 2024 by
Uyen Duong

The rapid growth in e-commerce the proliferation of free trade agreements are driving an unprecedented increase in demand for logistics services, then pave the way for new trends in digital freight forwarding.

But what exactly are these market trends taking over the logistics industry?

In this article, we'll explore the latest insights into digital freight forwarding trends and the pivotal factors propelling growth in the digital logistics market, then delve into five key trends shaping the industry and uncover the diverse segments within digital freight forwarding ​

I. What is Digital Freight Forwarding?

Digital freight forwarding uses technology (like big data, artificial intelligence) to automate processes, lower errors, and improve visibility while traditional freight forwarding relies on manual paperwork and communication.

II. 5 Leading Trends in the Digital Freight Forwarding Market in 2024

Below are the five latest trends in the digital freight forwarding industry:

1. Global Expansion of E-Commerce

The surge in online shopping, fueled by easy accessibility, substantial discounts, and a user-friendly experience, has propelled significant growth in both domestic and international transportation of goods.

The benefits of digital freight forwarding include:

  • Transparent prices
  • Instant quotes
  • Easy shipment tracking
  • Online documentation
  • Efficient supply chain management

2. Emergence of D2C E-Commerce

D2C (direct-to-consumer) e-commerce refers to a manufacturer directly selling their product to the customer online without any intermediaries. Seamless logistics processes, particularly shipping and delivery, are crucial for ensuring customer satisfaction in such cases.  Online freight forwarding tools enhance supply chain visibility by offering real-time updates on cargo status and location. According to 6Wresearch, the Vietnam D2C Market size is anticipated to register growth during 2021-27, digital freight forwarding solutions are evolving to meet the growing demands of this sector.

3. Increasing Competition

Most digital freight forwarders (DFFs) provide all shipment information on a single platform, enhancing the user experience. Some top digital freight forwarder platforms in VietNam are Gemadept Corporation, DHL Global Forwarding (Vietnam) Corporation, Expeditors Vietnam Company Limited, Transimex Corporation, Bee Logistics Corporation, Kuehne + Nagel Company Limited, Schenker Viet Nam Co., Ltd... The growing competition among digital forwarders and logistics companies, plus the fragmented market will further power the growth of digital freight forwarding solutions.

4. Rise in Global Trade Deals and Free Trade Agreements

A rise in Free Trade Agreements (FTAs) has prompted the growth of digital freight forwarding technologies within the logistics industry. While Vietnam is the only country which has signed FTAs with all major economic partners namely the U.S., Japan, China, the EU, South Korea , the UK and Russia.

Such global trade agreements reinforce the importance of international commerce in the aftermath of the pandemic. They drive the growth of online freight forwarding market players.

5. Lack of Transportation Infrastructure and Higher Logistics Costs

The transit of e-commerce shipments across multiple cities and countries has heightened the need for proficient digital forwarders. 

A digital transformation allows these logistics service providers to: 

  • Optimize operations 
  • Expedite the quotation process 
  • Reduce manual process time and costs 
  • Offer better supply chain visibility with real-time track and trace updates.

Indeed, traditional freight forwarders are also shifting towards digital platforms in response to challenges such as inadequate transportation infrastructure and rising logistics expenses. 

But what precisely are the factors propelling the growth of digital freight forwarding? 

Let's delve deeper into this inquiry!

II.  5 Factors Behind the Growth of Digital Freight Forwarding

Below are 5 crucial elements fostering the advancement of digital freight forwarding within logistics companies. 

1. Greater Visibility and Transparency

Digital freight forwarding platforms provide precise shipment location updates, enhancing customer visibility into product movement within the supply chain. Access to this transparent data fosters improved communication and collaboration among all involved parties.

2. Increased Speed and Efficiency

The digitization of freight forwarding facilitates expedited transportation of goods and swift resolution of global supply chain challenges. Automation of repetitive tasks as a digital forwarder minimizes manual errors, enhances efficiency, and elevates customer service. Moreover, it fosters improved communication among stakeholders involved in the shipment process, including independent freight forwarders, carriers, and shippers.

3. Better Scalability and Sustainability

Advancement in freight forwarding technologies such as big data and artificial intelligence enables the streamlining and automation of various tasks including emailing, generating quotes, tracking shipments, and more.

By reducing the resources allocated to operational duties, you can efficiently scale up your logistics company across diverse geographical regions.

4. Enhanced Flexibility and Agility

A digital transformation empowers you to dynamically address supply chain disruptions in real-time and implement agile solutions on the go. It also equips you with the ability to proactively anticipate potential challenges and preemptively devise solutions.

This facilitates the seamless optimization of your logistics company operations, enabling the smooth execution of all freight forwarding services.

5. Improved Customer Experience

Digitization updates customers about their shipments, including easy search, booking, and tracking. 

In contrast to a traditional forwarder, a digital freight forwarder prioritizes customer communication by providing real-time updates and efficient grievance redressal. This proactive approach significantly elevates the overall customer experience.

III. Conclusion

We hope that the aforementioned article has provided you with a comprehensive understanding of the latest trends in digital freight forwarding. Furthermore, Sota Solutions boasts a wealth of experience in successfully executing digital transformation initiatives for freight forwarding businesses specifically in Vietnam. Should you require further guidance or assistance, please don't hesitate to contact us. We're here to support you.

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