Got a tracking number? Let’s see where your freight is
When it comes to logistics conferences, TPM is the 'big one'. At TPM23, The Journal of Commerce cast a wide net to assemble the leading logistics veterans from around the globe.
So, for those of you who weren't fortunate enough to make the trip to Long Beach we've compiled some of the most indispensable insights, predictions and advice.
After two years of being subjected to the most severe disruption in modern history, logisticians are feeling frustrated and burnt out. So, are we finally in the clear?
“Freight rates have come crashing back down to earth. Port congestion is a thing of the past for the most part. Fluidity has been restored. Supply chain delays are dissipating really now.”
Peter Tirschwell, Vice President S&P Global
“The good news bad news is that growth is slowing. So that helps a little bit with the decongestion of supply chains.”
Nariman Behravesh, Retired Chief Economist IHS Market
“Globally in this industry, we’ve averaged 75% schedulability. So 75% of vessels arrive within one calendar day of when it should be. That’s coming back, but we’re only hitting like 35% to 40% now, so we have a long way to go.”
Alan Murphy, CEO SeaIntelligence Consulting
What this means for you, is you’ll see a decrease in freight rates and a decrease in delays. This breathing room provides businesses an opportunity to focus on scalability and fortifying their supply chain against future disruptions and risks.
Many businesses have been treading water since the seismic disruption of the pandemic. Despite those challenges dissipating, there are still some risks to be aware of in the year ahead.
“This is the first year where there are geopolitical people at TPM. Nobody in the national security world understands globalized shipping. We have to get these two worlds together because right now we’re operating two completely different logics which are about to come to a head.”
Bruce Jones, Author, To Rule the Waves; Project Director, The Brookings Institution
“We predicted insolvencies as one major risk. Companies going bankrupt, particularly small businesses that might be hidden in your supply chain, two or three tiers down. If you’re single sourced there, you’re in deep trouble.”
Julie Gerdeman, CEO Everstream Analytics
“We are predicting that there could be some spikes in cyber crime around ransomware and phishing attacks. So be prepared and be able to monitor and assess your supply chain ahead of time proactively - not looking in the rear view mirror.”
Julie Gerdeman, CEO Everstream Analytics
In the face of these emerging threats, ensure you've assessed your supply chains potential weaknesses. Firstly, ensure you've mapped out your current supply chain accurately. Then, running simulations to predict when and where bottlenecks are likely to occur in the face of disruption can provide actionable insights into optimizing your operations. This process can be intimidating for those new to global trade. Arm yourself with expert guidance by contacting our team.
When the pandemic exacerbated the need for supply chain visibility and simplicity, digitalisation and data came to the rescue. Despite digitalisation's ability to open doors to greater visibility and agility, there's still financial, security and educational barriers to its wide-scale adoption.
“The ability to digitally book and track cargo is something that everybody should be doing because it’s there. You need to take advantage of it because it makes such a big difference to how cargo moves.”
Ruthie Amaru, Chief Product Officer, Freightos
“Data is more sand. You have to change it to become silicone, to become a chip. That’s where the value is going to reside. The data needs to be put in the right context and needs to be transformed and combined with other datasets. So a single data set is pretty useless in my opinion. That’s where data sharing comes in.”
Bertrand Chen, CEO Global Shipping Business Network
“More data is not necessarily helpful. We need to have meaningful data and it needs to be simplified in a way that is easy for supply chain managers to make the right decision. It’s no good if you need a PHD in carbon accounting to understand the data. It needs to be visualized in a way that it really stands out as to what you can do.”
Kathrin Brost, Vice President, Global Head of GoGreen Program, DHL Global Forwarding
As supply chains stabilize back to pre-pandemic levels, you may think a digital platform is less vital. But the experts at TPM23 disagree. The digital revolution is here to stay.
Not only this, but a new wave of digitalisation is in motion through the form of data sharing. This will create more valuable insights into the operations of the logistics industry such as more accurate location data and optimisation strategies.
However, 'data sharing' is still a dirty word in this industry with security concerns leaving many apprehensive to get behind the movement.
Gone are the days of greenwashing. As of 2023, the logistics industry is under tighter surveillance for environmental improvement through new legislation and certifications. For example, the International Maritime Organization is enforcing a carbon intensity indicator in the aim of reducing carbon emissions by 70% by 2050 when measured against 2008 levels. There's no question: the time to act is now.
“In essence there are only two things you can do if you want to decarbonise, you can burn less fuel or you can burn clean, which means that you use different engine technologies and sustainable fuels to emit no or little emissions.”
Kathrin Brost, Vice President, Global Head of GoGreen Program, DHL Global Forwarding
“Let’s not wait. There are options available now. You can make a switch to biofuel. It is one solution of course, there is a multi-fuel future. But why wait until the future to take action.”
Katarin van Orshaegen, Commercial Lead and Spokesperson, GoodShipping
Yes, there is still a green premium. Carriers are investing in new ships and green fuels while freight forwarders are assisting in data gathering and integrated carbon offsetting. Hence, the costs of a more sustainable future will need to be financed by all parties.
To play your part in decarbonising the logistics industry, you first need to know your carbon footprint. This is where digitisation is a key lever in grasping the scale of your emissions. Cargo owners then have the responsibility of offsetting or insetting their emissions.
Global trade is interdependent. In a single move, you need multiple people to cooperate with your best interests in mind. For this reason, strong and genuine relationships with your logistics providers are paramount.
“Relationships are critical. Relationships were undermined during covid. You’ve got to get to know people, you've got to look people in the eye when they tell you, ‘I can do this for you, I will have your back" and they look you in the eye, that has a lot more meaning than if they do it over a zoom call.”
Peter Tirschwell, Vice President S&P Global
With freight rates on the decline and cargo owners shopping around, it’s important now more than ever to evaluate your service providers' performance capabilities. Especially when signing long term contracts, you want to be considering the hidden costs that may incur due to a forwarder's performance.
Capabilities to consider include:
That said, it’s hard to make accurate predictions in the logistics industry thanks to all the complexly linked variables in play. It’s not like anyone was anticipating the 2019 pandemic.
Regardless, there is one thing we can guarantee. The logistics industry will continue to evolve in 2023. What has worked for us in the past, won’t work for us in the future. So digitalisation, sustainable innovation and data will continue to sharpen the execution of global trade.
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