On Thursday, March 23rd, we collaborated with the NCBFAA to air the webinar “The Key to Maintaining Operational Efficiency From Bookings to Warehouse.” At this event, Logixboard CEO Julian Alvarez sat down with Offshore Business Processing’s Maryann Farrugia and Logixboard’s Jon Bass to talk about how to achieve efficiency as a freight forwarder.
The discussion focused on several key areas where forwarders can invest to improve efficiency in their business:
The panel started off the event by discussing how freight forwarding companies can increase efficiency by maximizing their labor output. Farrugia talked about leveraging solutions like automation and offshoring to minimize staffing costs. In the COVID-era shipping boom, she’s noticed that a lot of forwarders increased headcount and salaries. Now, as margins are declining, many of those same companies are now having trouble keeping up with the cost of labor.
For this reason, Offshore Business Processing (OBP) is seeing a lot of new customers who aren’t able to find enough people in their area. By outsourcing basic data entry work, local staff can focus more on customer-facing roles, ultimately improving the customer experience.
Bass also weighed in to emphasize the importance of technology in automating manual tasks. “With freight forwarding, there’s a lot of manual tasks,” he said. “The more of those that you can either outsource or automate from a technology perspective, the more time you have to focus on the things that can potentially generate more revenue or better serve your existing customers.”
He talked about the impact that implementing automation can have on your business as it frees up time for your operations team, enabling them to focus on generating revenue or better serving your customers. Bass cited an example of providing a visibility solution with self-serve options for checking ETA updates and shipment information. With this, you can cut down on day-to-day requests from customers. “Then, when issues do arise, which in freight forwarding always happens,” Bass said, “You suddenly now have an operations team with a lot more time to concentrate on finding solutions.”
Farrugia kicked off this topic by pointing out the effect of COVID-19 on the adoption of paperless operations in the freight forwarding industry. She noted that 90% of the companies she works with have already gone paperless, as the pandemic forced companies to adapt to remote work and rely on technology for transparency in their shipments. Farrugia emphasized that going paperless is not just about efficiency, but also about cost savings. By minimizing the cost per job, companies can significantly impact their bottom line, even if they only handle a few hundred jobs a month.
She provided an example of a top 10 global freight forwarding company that saved $50,000 per head by offshoring and implementing workflow, resulting in a 25% growth in the first 12 months of working with her company. After they worked together for about eight years, the company set up its own shared service center. During that time, Farrugia estimated that OBP saved them in excess of 16 million dollars.
Bass also discussed the shift towards digitization, noting that people want to replicate the convenience and ease of their personal lives in their working lives. By going paperless and incorporating automation, companies can keep up with this societal norm and disrupt their industry. “People are starting to think about how do we take the things that we take for granted in our day-to-day personal lives and put that into our working life to make our working life easier,” he said. Bass noted that staying manual or reliant on paper-based processes can negatively impact a company’s operations, highlighting the importance of going digital.
Before moving on from the topic, Alvarez asked the panel to touch on the relevance of paperless operations and automation in today’s landscape. “A lot of forwarders are still working in a hybrid environment, so it just makes it almost impossible to work if you’re not paperless,” she said.
She also talked about how much forwarders have to gain by improving efficiency. “When you think about what you might earn per job, you know, when you’re making $25 or $50 per task, every dollar counts,” she said. “So, if you can even save a couple of dollars per job through some automation that you’ve gotten by going paperless, then, you know, if you’re doing 1,000 jobs a month, that quickly adds up.”
Moreover, the demographic of customers is changing, and they expect a digital experience with a little bit of customer service. By providing customers with online access to rates, shipment information, and real-time tracking, freight forwarders can increase customer satisfaction and loyalty.
As Bass explained, “Think about little things like the self-serve aspect and being able to have customers access information. They don’t have to go to the hassle of sending an email, picking up the phone, and chasing, right? So immediately, the customer feels better about that solution.”
For freight forwarders, the TMS is the backbone of your operation. It enables them to manage and run their business while keeping costs in check. Despite this, experts find that many forwarders use only a fraction of their TMS, leaving substantial savings and efficiencies on the table.
To help forwarders tap into the full potential of their TMS, Farrugia emphasized the importance of mastering your TMS. “It doesn’t matter what TMS you’re using,” Farrugia said, “they’re all expensive. You get what you pay for. If you invest in automation and use the tools within your TMS, you can reduce the number of staff needed or increase the volume of work without adding headcount.”
She stressed that freight forwarders should focus on what they can achieve with their current TMS rather than just what they’re paying. By streamlining processes, automating tasks, and using software platforms to grow, forwarders can free up staff to focus on customer-facing activities and building relationships. In turn, this can help expand revenue and protect against customers defecting to competitors.
Bass likened the search for a logistics tech solution to the process of shopping for instruments. While the tools are important, they don’t guarantee a great output. Rather, your TMS is only one factor in what you can accomplish. However, by investing in powerful integrations and working with experienced consultants, you can improve efficiency, lower costs, and increase ROI.
Alvarez introduced the topic of change management as “critical” in ensuring your team’s success in implementing changes. By focusing on thorough preparation and ongoing support, leaders need to make sure their teams are enabled to execute the changes effectively.
“One of the things I’ve noticed is that this type of change has to start at the top,” Alvarez said. He pulled on what he’s observed in his experience helping customers implement their technology needs. “I think it’s very clear that people need to have a strong conviction as to what the ROI they want to get out of it,” he said. In other words, if that messaging isn’t coming from the top down, it’s hard to get everyone on the same page to work toward your goal.
In addition to the need for internal alignment and top-down, Alvarez also talked about the importance of partnering with providers who can offer direct integration into operating systems, ensuring a seamless transition and quick ROI. “It’s not ideal to work with a company that says they can integrate with your TMS but takes 18 months to get there,” he said. He contrasted that scenario with Logixboard’s average integration length of roughly 8 days, providing new customers with a quick time to value.
When it comes to investing in technology partners, Bass stressed the importance of considering return on investment and working with partners that prioritize servicing customers and improving internal services. He acknowledged that choosing the wrong solution can result in wasted time, and therefore, money. However, he prefers to maintain a growth mindset. “I always like to look at the positive stuff. So if you get that stuff right, it means that you can save a lot of time, and actually make a lot of money.”
Alvarez added that successful implementation requires working with partners that not only provide technology but also invest in training and fostering strong relationships with their customers. “You also want a partner that’s not, you know, to your point, just going to help you implement and come back two years later and say, ‘Hey, do you want to renew with me?’” he said. Instead, you want to find someone who’s willing to work together to drive success.
Ready to find a tech partner to level up your efficiency and enhance your customer experience? Get in touch with our team to find out how Logixboard can integrate with your TMS to delight your customers.
An entrepreneur at heart, Julian has successfully founded and led multiple businesses in industries ranging from financial services to medical technology. After hearing about the need for innovation in the freight forwarding industry from his brother Juan, they decided to partner up to develop a solution that allows freight forwarders to quickly and effectively modernize their shippers’ customer experience. Now, as CEO of Logixboard, Julian remains dedicated to helping freight forwarders compete in an evolving market by understanding and capitalizing on new technologies.
OBP is a business process outsourcing company that works across a wide range of industries including Freight Forwarding, Logistics, Accounting, Legal, & IT. With over 600 employees, OBP has been a vital partner of global supply chain and logistics companies for over a decade by providing expert, reliable service and solutions to clients who enjoy dedicated freight forwarding specialists and licensed brokers that partner with them exclusively.
Jon is an experienced business development leader in the Freight Tech space with an extensive career of well over a decade in the traditional freight forwarding industry. Jon has worked for some of the world’s largest multinationals including K+N and Agility. In 2019, Jon moved into the world of freight technology by joining Freight Saas startup Beacon as their 6th employee. He was responsible for leading their sales team from their seed round through to their $50m Series B fundraising. During this time, he saw the business grow to over 200 people. In October of 2022, Jon joined Logixboard as the EMEA Regional Manager for Business Development. In this position, he continues to combine his passion for the traditional freight industry and the emerging technology that is helping to drive innovation in the space.