CASE FINDING AND EVALUATING FREIGHT FORWARDERS
FINDING AND EVALUATING FREIGHT FORWARDERS
This is a team assignment to be prepared in groups of 3-4 students. Some, probably not all but this depends on timing, may be asked to present your findings to the group. Presentations should be scheduled for roughly 5 (at most 10) minutes.
Growth in international trade has increased the importance of logistics and international transportation as strategic tools for achieving competitive advantage. One solution is to take advantage of the services of a freight forwarder. The evaluation and selection of a freight forwarder is a critical strategic decision for managers involved in international operations. In this Management Skill Builder, we focus on a basic approach for evaluating freight forwarders, with a view to choosing one that best suits the exporter’s needs.
The freight forwarding industry has become crowded with many competitors. Leading ocean carriers (e.g., Sea-Land, Nedlloyd, and Maersk) now provide forwarding services. Air carriers (e.g., KLM, Lufthansa, and American Airlines) have begun targeting large accounts directly. Recent decades have seen the rise of large international express providers (e.g., FedEx, DHL, UPS, and Flying Tigers) that provide many freight forwarding services cost-effectively, due to their massive economies of scale. In this competitive environment, differentiation has become a critical strategic tool. Freight forwarders are expanding their effectiveness and global reach by expanding office locations; integrating electronic data interchange (EDI) facilities to their booking, tracking/tracing, and management reporting services. EDI is a web-based system that allows firms to exchange all manner of data and information instantaneously. Some forwarders specialize in specific regions, markets, ports, modes, products, or even routes. To handle the greater customization needs of exporters, some forwarders are providing personalized on-site presence and are integrating their systems to those
This is a team assignment to be prepared in groups of 3-4 students. Some, probably not all but this depends on timing, may be asked to present your findings to the group. Presentations should be scheduled for roughly 5 (at most 10) minutes.
Growth in international trade has increased the importance of logistics and international transportation as strategic tools for achieving competitive advantage. One solution is to take advantage of the services of a freight forwarder. The evaluation and selection of a freight forwarder is a critical strategic decision for managers involved in international operations. In this Management Skill Builder, we focus on a basic approach for evaluating freight forwarders, with a view to choosing one that best suits the exporter’s needs.
The freight forwarding industry has become crowded with many competitors. Leading ocean carriers (e.g., Sea-Land, Nedlloyd, and Maersk) now provide forwarding services. Air carriers (e.g., KLM, Lufthansa, and American Airlines) have begun targeting large accounts directly. Recent decades have seen the rise of large international express providers (e.g., FedEx, DHL, UPS, and Flying Tigers) that provide many freight forwarding services cost-effectively, due to their massive economies of scale. In this competitive environment, differentiation has become a critical strategic tool. Freight forwarders are expanding their effectiveness and global reach by expanding office locations; integrating electronic data interchange (EDI) facilities to their booking, tracking/tracing, and management reporting services. EDI is a web-based system that allows firms to exchange all manner of data and information instantaneously. Some forwarders specialize in specific regions, markets, ports, modes, products, or even routes. To handle the greater customization needs of exporters, some forwarders are providing personalized on-site presence and are integrating their systems to those