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The Role of Automation in US Freight Forwarding

November 29, 2024 Freight Forwarding Softwareunited states

Traditional freight forwarding services in the USA have historically relied on paperwork for documentation, customs clearance, and shipment tracking, which has made logistics a complex and error-prone process. Without real-time data and visibility provided by digital tools, shippers and forwarders often struggle to anticipate and react to delays or disruptions in the supply chain. To become more efficient and competitive, it’s essential to embrace technology in the freight forwarding business.

Automation simplifies complex processes by handling repetitive tasks, from booking shipments to generating invoices and swiftly sharing important documents and milestone information with respective stakeholders. This reduces manual intervention and the risk of human error.

Take the example of Bill of Lading (BL) generation, a key element for USA freight forwarders. Automating the BL generation and approval process eliminates manual intervention. The system automatically generates the BL document, shares it with the customer for approval, and upon customer approval, creates the original BL without further manual input.

The benefit of automation for forwarders include:

  • Reduced human error: Minimal human intervention lowers the chances of mistakes
  • Improved operational efficiency: Less manual work allows forwarders to focus on more critical tasks
  • Increased accuracy: Automation leads to higher work accuracy due to fewer errors

Automation can significantly improve the efficiency of the US freight industry by enabling faster and more accurate decision-making, better shipment tracking, and enhanced customer service. It also helps reduce inventory management and shipping costs, all of which contribute to increased efficiency.

According to a report by Grand View Research, the global freight forwarding market is projected to reach USD 215.7 billion by 2027, growing at a CAGR of 4.5% from 2020 to 2027. Factors driving this growth include increasing global trade, the rise of e-commerce, and the adoption of automation technologies.

In this article, we’ll explore Excellent Customer Service, Automating Manual Tasks to Improve Operational Efficiency, Seamless Communication & Collaboration, Enhanced Visibility with Real-Time Tracking, Cost Optimization, Reducing Emissions and Promoting Sustainability and Data Analytics and Reporting

By adopting the latest technology and the best freight forwarding software, forwarders can benefit from automation in the following ways:

  1. Excellent Customer Service: Good customer service in freight forwarding requires quick responses, timely delivery, and value-added services. Automation enhances customer service by providing clients with up-to-date information on their shipments and simplifying interactions with the freight company. Features like a customer portal allow clients to send inquiries, track shipments, access invoices and reports, and receive automated notifications and tracking updates, thereby improving satisfaction and trust.

Automated email notifications alert customers about shipment status, unforeseen delays, and estimated delivery times, offering an exceptional customer experience. Important compliance documents can also be accessed easily through digital freight forwarder software. This automated communication fosters transparency and builds customer trust in the services provided.

  1. Automating Manual Tasks to Improve Operational Efficiency: Freight forwarding software handles repetitive tasks such as processing documents, communicating milestones to customers, tracking cargo, and organizing quotes. This optimizes human resources, supports business growth, and reduces the burden of overhead. Automation simplifies complex operations by maintaining commercial data consistency and enabling efficient sales team resource management.

Role-based data entry can also be automated to enhance efficiency and accuracy in fields like customer names, addresses, and other critical information, reducing human workload and providing support during peak periods.

  1. Seamless Communication & Collaboration: In freight forwarding, email is frequently used to share quotes, shipment updates, customs paperwork, and billing details with various vendors and clients. Freight forwarding management software consolidates automated emails, documents, and shipment-related messages into a single platform. This helps reduce clutter, prioritize communications, and provide easier access to information, thereby improving collaboration and efficiency.

  1. Enhanced Visibility with Real-Time Tracking: Automated systems provide real-time tracking and visibility of customer cargo. Using cloud-based freight forwarding software, which offers live tracking and ETA prediction, companies can monitor the exact location and status of cargo, ensuring transparency and timely client updates. Customers also receive immediate notifications about any cargo delays.

This level of transparency allows for rerouting shipments around disruptions, minimizing delays, and ensuring on-time deliveries, thus enhancing customer satisfaction and building trust.

  1. Cost Optimization: Automation reduces operational costs by minimizing manual labour, human errors, and streamlining processes. Research shows that early adopters of automation have reduced logistics costs by up to 15%. These cost savings allow companies to invest in other business areas, fostering growth and innovation.

  1. Reducing Emissions and Promoting Sustainability: Freight transportation is responsible for 8% of global emissions, and projections from the Intergovernmental Panel on Climate Change (IPCC) indicate that it could become the top emitting sector by 2030.

Digitization through the best freight forwarding software and data analytics plays a key role in decarbonization efforts. It enables forwarders to regulate and monitor emissions and adopt environmentally friendly operations, such as using low-carbon fuels, green supply chains, and standardized environmental frameworks.

  1. Data Analytics and Reporting: Freight forwarding system automation collects and analyzes large volumes of data to generate valuable insights through comprehensive reports. This helps forwarders predict issues before they arise, plan routes accurately, and make informed decisions.

With these data-driven reports, forwarders can easily track year-on-year trends, shipment volumes, revenues, and top-performing sectors, allowing them to identify business expansion opportunities. Reports also provide insights into team productivity and efficiency, helping forwarders stay ahead of the competition.

NewageNXT freight forwarding software offers complete control over automation processes at various levels. It allows businesses to provide value-added services to customers through a digital portal, giving them real-time visibility of shipments, the ability to send inquiries, receive quotes and invoices digitally, and receive automated notifications for every milestone.

With the automation capabilities of NewageNXT, forwarders can seamlessly communicate and collaborate with stakeholders. Additionally, revenue management is handled efficiently, with no need for human intervention in payment reminders, eliminating the risk of human error and revenue leakage.

We also offer Business Intelligence tools that provide insights into your business, allowing you to make data-driven improvements and expand business operations for increased profitability.

Conclusion

The impact of automation on the freight industry has led to increased efficiency, reduced costs, and improved customer service. Automation has enhanced communication, tracking, and monitoring of shipments while providing real-time updates. It has also reduced human errors and optimized operational accuracy. By leveraging data analytics, freight forwarders can continuously improve processes and remain competitive.

 References:

Intergovernmental Panel on Climate Change (IPCC):

https://www.ipcc.ch/report/sr15/mitigation-pathways-compatible-with-1-5c-in-the-context-of-sustainable-4-development

Grand View Research:

https://www.grandviewresearch.com/

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