Today’s blog theme is turning out to be global transportation and logistics, specifically, ongoing development in the global ocean container shipping sector. We just posted highlights of a warning from European shippers regarding capacity disruption and spiking rates for exporters.
The logistics and transportation industry has now come to realize a new reality, that Amazon is and will be in the future, a freight broker as well as a transportation and logistics provider for key Fulfilled by Amazon supplier customers. That has been a wake-up call for both the industry as well as industry shippers, since Amazon has not been shy in investing in advanced technology and digital transformation to support its business processes directed as customers and suppliers.
As we have pointed out in prior blog postings, the booking of transportation of ocean containers or airfreight has traditionally been the purview of transportation brokers. A prior Supply Chain Matters guest posting contributed by Cory Margand, Co-Founder and CEO of technology start-up SimpliShip.com, explained how brokers negotiate rates with carriers whether it be air, domestic, parcel, and then resell to customers at a higher price. Carriers get the benefit of large volume from one customer and they don’t have to worry about the small customers that they simply are not set up to do business with from both an operating and pricing stand point. Margand observes that a new iteration of Cloud-based systems has come to market that essentially makes this transportation scheduling process more efficient for both customers and brokers.
Reviewing our newsfeed from The Wall Street Journal today, this supply chain management industry analyst took note of another development regarding this new iteration of shipping technology that has the potential to impact this industry.
Today’s WSJ report (Paid subscription required) indicates that shipping technology provider Freightos has raised an additional $25 million in Series B round funding, bringing this company’s total funding to-date of nearly $50 million. The latest funding round was led by General Electric’s GE Ventures business unit, which will have a nonvoting seat on the Freightos board. A further reported investor is Master (HK) Toys, a Hong Kong based toy manufacturer that has shipped upwards of 100 million tons of toys by air. That ladies and gentlemen, is a lot of toy volume. According to the report, this toy manufacturer now plans to utilize the Freightos online platform.
This tech provider currently specializes in trans-Pacific air and ocean shipment utilizing an online freight marketplace supported by SaaS (Software-as-a-service) technology, which was launched in July of last year. The company’s stated mission is to usher the logistics industry into the digital era. According to the WSJ report, this newest round of funding will allow the company to expand the number of routes supported, including more services to and from Europe. The company’s software will also be made available to freight forwarders.
Of late, we have observed significant investment monies being channeled into supply chain management focused technology and managed services, prompting us to predict a renaissance in Cloud-based technology targeting supply chain management business process areas in the coming months. Therefore, we expect other announcements related to start-up and scaling of digitally-based supply chain business processes to continue.
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