Why and how manufacturers and retailers shipping international freight on container ships should track cargo and provide updates to their B2B customers as easily as consumers track e-commerce purchases.
By Adam Compain
The “Amazon Effect” continues to reshape consumers’ expectations of customer experiences and delivery. This is impacting B2B supply chains as manufacturers and retailers shipping international freight seek to provide their business customers a similarly transparent and seamless delivery experience. Hoping to transform their supply chains from cost centers to profit centers and become the “Amazon” of their respective industry in terms of customer experience, businesses are looking to expedite digital transformation of their supply chains.
Digitization of supply chains has largely been underway for a while, but digitization alone is insufficient.
Supply chains are inherently dynamic systems designed to move goods and ideas toward end-users or purchasers. There are countless events that could happen along the way to impact the trajectory of whatever is moving through the supply chain. The more partners along the chain – suppliers, terminals, transportation providers, distribution centers – the more complex the system becomes, the more challenging it is to monitor events. Global trade is especially complex, with a typical shipment involving anywhere from five to 25 different parties and handoffs, each with other data collection tools and reporting processes. To deliver a better customer experience, businesses need to close the gap between customers’ expected reliability and transparency of international freight shipments (what they have come to expect in B2C e-commerce) and reality.
The reality is supply chains are largely built on static data, systems, and methods for making logistics decisions. Information from transit tables and carrier websites about when a vessel departed a terminal or is expected to arrive at a port often is inaccurate, latent, or incomplete, and only provides insight into static points in history. By the time the data is manually cleaned and analyzed, it is outdated and not of much use.
Static visibility also blocks the timely flow of information between business units, partners, and customers, so responses to exceptions and events are reactive and siloed. This is what happens when a manufacturer in Missouri expecting raw materials from Brazil plans port-to-door transportation and schedules factory workers based on an on-time delivery date they received from the shipper. When the freight does not arrive on the anticipated date, the manufacturer loses time and money and cannot produce. The manufacturer is frustrated they did not receive an alert notifying them the materials would be delayed, and because they cannot easily check the status of their order online, they call the shipper. The shipper spends hours chasing carriers and suppliers via phone, email, and text for answers. The inefficiencies – not to mention the frustrations – of this model are staggering when one considers the volume of goods that travel in containers across oceans each year.
Digitally transformed supply chains apply data science and algorithms to eliminate inefficiencies by providing end-to-end visibility from raw material suppliers to end customers. ClearMetal’s software platform uses advanced computational models that continuously collect, organize, and clean enormous amounts of data – historical data sets, ocean EDI data, third-party partner data, satellite IoT data, terminals, ports and rail data, customer ERP data, and more. Artificial Intelligence (AI) and machine learning cross-reference inputs and enrich the data. By running millions of AI calculations and constantly updating them with new data based on what is actually happening in real time, organizations can make more accurate predictions about on-time delivery dates to customers and also gain insight into carrier performance and compare routes and modes to optimize transportation planning.
All of this is done seamlessly and automatically so shippers no longer have to manage shipment status and order updates manually using outdated and incomplete data. Shippers can provide their B2B customers access to portals that display the real-time and accurate status of shipments in transit so that even if shipments are delayed due to capacity constraints or other events, customers are aware and can plan accordingly. They also can easily find this information on their own instead of calling logistics and customer service teams with inquiries about the status of their stuff.
Organizations that embrace true digital transformation of the supply chain can expect to see cost savings in the form of better transportation planning and reduced fees related to detention and demurrage, increased revenue from happier customers, and reduced labor costs due to operational efficiency improvements. This is what happened when global packaging, paper and pulp producer Georgia-Pacific decided to provide its customers an “Amazon-like” digital B2B experience in global freight transportation and deliver products in a timely and predictable manner. Using our software platform, Georgia-Pacific saw a 50% improvement in on-time delivery, a 30% increase in operational efficiency and healthier cash flow in the form of automated invoicing.
Businesses are increasingly taking a predictive logistics approach to global freight transportation. Their motivations, coupled with AI, machine learning and big data, are accelerating the digital transformation of supply chains and bridging the gap between B2C shipping expectations and B2B shipping reality.