Forwarding

None of the most prominent venture-backed names in logistics has had a successful exit yet, but perhaps patience is still required before the industry can say for sure if venture capital is a worthy funding route for company founders.

Those making offers — which analysts say could top $20 billion — are expected to be a list of major global forwarders including DSV, Kuehne+Nagel and DHL Global Forwarding.

There has been no sign of a slowdown in the carrier’s acquisition activities as it uses its cash-rich position to expand its footprint in key port and logistics markets.

Getting the most out of global logistics software sometimes involves using a forwarder as a co-pilot until a shipper is ready to run processes similarly to procurement and order management internally.

The expansion of the three companies, all representing different modes across the US-Canadian border, underscores the depth of the relationship between the two economies.

The expedited less-than-truckload provider has asked a Delaware court to let it kill the controversial deal that has caused its share price to plummet and raised the ire of activist investors.

Shipper associations that struggled to grow during the COVID-19 pandemic because there was no extra capacity to sell are now trying to convince shippers of the benefits of rate stability.

With weak demand for European imports in Asia and ample vessel capacity, spot rate levels on the backhaul trade are in freefall.

Ryan Petersen tells the Journal of Commerce that the first order of business after this week’s acquisition of Convoy’s tech stack is getting the Convoy app running again and reaching out to the shuttered company’s customers.

Freight forwarder Omni isn’t giving up on a merger with Forward and is moving to force completion of the deal despite Forward’s cold feet. 

The world’s largest ocean forwarder by volume said that despite an uptick in container freight during the third quarter, many customers still have too much inventory on hand from prior years.

The announcement was made simultaneously with the forwarder releasing its nine-month financial results that reflected softening air and ocean markets, dragging down profitability from last year’s record performance.

The company will sell its technology and shut operations, deciding it could not grow its business while paying the legal fees of ousted CEO Chris Kirchner.

Spot rates are being dragged down by forwarders speculating on an extended period of weak rates on the Asia to Europe trade as capacity is expected to outstrip demand through 2024.

In 16 years running DSV, Andersen has presided over the integration of a string of multi-billion-dollar acquisitions and guided the forwarder through significant disruptions to global supply chains.

Shipments are getting smaller over time, driven in part by e-commerce growth, but also by a market that is disentangling cargo previously handled through air or ocean consolidation.

Much criticism has been leveled at the digital forwarding model, but steep declines in topline revenue during a year of weak demand are a sign that digital forwarders have had trouble differentiating themselves from the pack.

Estes Forwarding Worldwide, a subsidiary of the LTL trucking provider, is buying Superior Brokerage Services, a step that increases Estes’ ability to offer end-to-end logistics services as other providers look to do the same.

Richard White said in an interview with the Journal of Commerce the logistics industry is stuck in a pattern of tackling small problems instead of viewing international trade as a large, connected system.

Washington is urging NVOs and forwarders to “know their customer,” a steep challenge for co-loaders who bundle multiple shipments for multiple customers into a single container, writes Journal of Commerce Executive Editor Mark Szakonyi.

The gains in spot rates for ocean freight are eroding again as US importers see little need to book more space ahead of the holiday shopping season.

As many have observed in disparaging the notion of a “digital” forwarder, of which Flexport was the prototype, forwarding at its core is a business of people solving real-world problems for which there is not — and probably never will be — a technology solution, writes Peter Tirschwell.

Sanctions imposed on Moscow following its invasion of Ukraine continue to limit the attractiveness of transport times as low as 12 days offered by forwarders on the China-North Europe rail network.

Flexport founder and CEO Ryan Petersen refused to pin the blame for the company’s abrupt change in leadership on waning freight demand, saying the forwarder “has been through worse macro environments.”

A difference of opinion over Flexport’s strategic shift toward fulfillment aimed at small businesses has prompted CEO Dave Clark to depart the company only a year after he came aboard.

The German-based forwarder remains the largest and most attractive takeover target in a cash-rich industry where the main players are all looking for opportunities to consolidate.

Development of trade finance tools for small and medium-sized shippers continues to grow, evidenced by OOCL Logistics launching a trade finance platform with fintech provider Stenn.

Supply overcapacity coupled with mediocre freight demand has the top 25 trans-Pacific non-vessel-operating common carriers deciding whether to chase lower margin business or suffer volume losses.

The CMA CGM subsidiary’s latest acquisition will significantly increase its presence in South Asia that is growing in importance as supply chain routes shift across the region.

Getting shippers to commit to premium-priced, low-emissions shipping services is a hard sell for ocean carriers and forwarders as cargo owners enjoy rates that are now mostly below pre-pandemic levels after two years of record highs.

A study of global logistics professionals around hurdles to technology investment found that respondents were uninterested in linking financial rewards with software adoption.

Spot rates in the eastbound trans-Pacific continue to move higher, although a planned general rate increase this week could be the last one for a while, as carriers are scheduled to add a significant amount of new capacity into the global fleet beginning later this year.

Shippers and forwarders recently surveyed by Freightos believe artificial intelligence will reduce headcounts in the logistics industry, even if they have yet to figure out how best to use the still-emerging technology.

Maersk has invested $10.5 billion in its logistics and services business to date, but results are falling behind plan after last year’s volumes evaporated.

Forwarders have an opportunity to reduce labor costs and improve margins using artificial intelligence (AI), but managing the transition away from a human workforce could prove difficult.

The decision by DSV and Kuehne + Nagel to protect yields at the expense of volume is allowing the forwarders to move into an uncertain second half in a solidly profitable position.

The CEOs of DSV and Kuehne + Nagel, shrugging off heavily distorted year-over-year comparisons, described their second-quarter results as “solid” and reflective of the evolving normalization of the air and ocean markets.

Research by ECU Worldwide found that about half of ocean freight bookings are made via email, highlighting the importance of connecting booking platforms to email systems.

Sedna’s approach of allowing companies to retain their email systems while extending their value has won new forwarding and bulk customers and a fresh capital infusion.

A return to normal freight demand is part of the reason for layoffs across the logistics technology sector, but just as important is investor focus on cost controls and a path to profitability.