U.K. based Transport Intelligence publishes global survey of shippers and forwarders

Another article I read in the September issue of Air Cargo World, the article points out that the survey found that shippers rated "proactive problem notification" as the most important service requirement from a freight provider. I have long contended this point in the industry for years. At the heart of our business is communication. Nothing is more important than maintaining excellent communication among our customers, vendors, and partners. I have often argued that the company that is able to communicate more timely and accurately then their competitors will always be able to steal business away from others.

As a smaller company in the industry, this is the most important key to my company's success. We may not have the largest worldwide network, or able to negotiate low prices with the carriers like our bigger competitors, but the reason we continue to literally snatch customers away from the big boys is because we demonstrate time and time again that we communicate with our shippers better than they do. Most importantly, as this survey suggests, we are extremely proactive in notifying our customers of problems. Rarely do our customers find out about problems before we do. We never shy away from notifying our customers immediately of any and all problems as soon as we know about them.

In this article, the survey goes to point out that while this issue is the most important aspect of the forwarder/shipper relationship, that most shippers rate forwarders poorly in this regard:

John Manners-Bell, chief analyst at Transport Intelligence, points to some
divergent views between perception and performance.

"According to the shippers we surveyed, they rated proactive notification of
problems with a shipment as their most important aspect of customer service from
the forwarder. However, most forwarders were scored by the shippers as 'less
than acceptable' in this key service attribute," he says.

"The gap shows
that there is a clear opportunity for the leading freight forwarders to win
competitive advantage by addressing these issues," says Manners-Bell. "Although
forwarders have to rely to a large extent on the performance of their carriers,
the survey strongly suggests that when things do go wrong they still need to be
more proactive in informing their customers."
He adds, somewhat alarmingly:
"Despite the many millions invested in technology, it also seems that the flow
of information between supply chain partners is still less than optimal."

This is one of my biggest gripes about our industry. We pour billions into technology that is supposed to make communication faster, easier, and more accurate, bringing us closely together. But this has not happened. It does not matter how much you spend on technology if you do not utilize that technology to improve the communication.

But he adds that the air freight forwarding market will continue to remain
highly fragmented with no single player gaining dominant control.
"One of
the reasons for this is the low barriers to market entry and exit," explains
Manners-Bell. "There is still little financial investment required to establish
an 'asset-lite' operation, with personal service a key competitive advantage in
the eyes of many shippers. Smaller operators can provide (personal
service) equally well, if not better than, their larger rivals."

For those of you larger 3PLs worried about customer retention, the first place to start is improving DIRECT communication with your clients. Try to reduce the layers of communication between your customer and those that directly handle their account. Make it easier for them to contact those people directly. Most importantly, keep your customers notified about problems as they occur and BEFORE they have to call you about those problems. The burden of communication should never be put on your customer's shoulders - it is always on yours.

For those shippers out there who are frustrated with their current 3PL or other freight provider, try taking a look at some of the smaller players in the market. Smaller companies tend to be more attentive and proactive in dealing with their customers problems. However, if you are just looking for the cheapest deal around and hire logistics providers based on the lowest price available, then you might as well stick with your current provider. After all, you get what you pay for.