How to Maximize Business Opportunities in the Freight Forwarding Industry in 2023
March 15, 2023 • 3 minutes read
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As we move into the second quarter of 2023, we believe there’s no better time to take your freight forwarding business to the next level. From mid-2020 through the fourth quarter of 2022, the industry has experienced extraordinary highs and lows and a combination of unprecedented instability, disruption, and prosperity. We understand the challenges you face in navigating constantly changing rates, volumes, and capacity fluctuations, and we would like to provide some support and insights.
“The era of sky-high container shipping rates and supply chain turmoil has passed, but that doesn’t mean the seaborne cargo market has returned to the relatively placid conditions that preceded the pandemic. Instead, the market is undergoing something of a reset.”
A Reshaped Competitive Landscape
In their recent Container Shipping Outlook Report, AlixPartner’s found that “In the 12 months ended September 2022, the world’s 15 largest carriers reported combined revenue of $369 billion, up 21% from 2021—which was itself a record year—and 116 times 2019’s results.” In the 12 months leading up to September 2022, these carriers reported a combined revenue of $369 billion, up 21% from the previous year. They accumulated a total of $179 billion in cash from operations, which is more than the amount accumulated in the previous 11 years.
What Lies Ahead in The Freight Forwarding Industry?
Carriers and shippers are already engaged in negotiating new contracts for 2023. And the new contract season may see even further deviations from the typical negotiating pattern, with some shippers seeking shorter terms and carriers looking to offset rate declines via revenue increases in accessory, value-added services. After spending more money than necessary on multi-year contracts, shippers are now looking to renegotiate or move to the spot market. The arrival of new shipping capacity and plummeting demand caused rates to drop in Q4 2022, and the slowdown in demand since Q3 2022 has allowed carriers to focus on improving their service levels.
Implications for stakeholders
Even as rates pull back and revenues moderate, stakeholders across the shipping value chain can improve their competitive postures, optimize their operations and position themselves to outperform when the economic tide turns again. Notwithstanding the issues that rate and volume changes may present for some shareholders, 3PLs and freight forwarders stand to gain financially from them, according to the AlixPartner research. In a market where rates are constantly changing, mid-sized businesses might profit by taking chances that larger stakeholders might be hesitant to accept. And we think that this would help you grow your company and find a profitable market niche.
With your needs as the main basis, our all-in-one cloud-based system can help you take advantage of these opportunities and increase your profits.
Key GoFreight differentiators that empower your growth:
· Real-time access to volume and profit reports
· Ability to quickly identify shipments with negative profits
· Utilize the integrated accounting system to assess your business
Our simple workflows provide total visibility and will help you avoid detention and demurrage fees. You can easily increase customer loyalty by enabling the customer portal feature. Our commitment to excellent customer service and technical support ensures that you have the support you need to streamline your operations and succeed.
“With GoFreight, I can easily supervise the performance of multiple operation teams, making management easier and more straightforward with everything centralized in one customizable dashboard. Besides, GoFreight to me is a live system, and you can easily see its improvement with the bi-weekly updates.” Says Jeff Lee, the Sales Manager of United Cargo Management Inc.
Want to learn how GoFreight can help your business succeed beyond 2023?
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