Like most business owners, you know that freight forwarding is critical to getting your products to market. But what does that mean? And more importantly, what are the lessons learned from years in the freight forwarding industry?

In this post, we’ll explore some of the essential things about freight forwarding so you can make the most informed decisions for your business. Stay tuned!

The Freight Forwarding Industry Has Changed a Lot in the Past Few Years

The coronavirus pandemic caused extreme disruption in the container shipping industry.

Between January 2019 and June 2022, container freight rates rose sharply. Global freight costs increased dramatically in 2021, setting a record-high price of around £8,700 per TEU in September.

The index for international freight rates was approximately £6,000 per TEU in June 2022.. The global supply chain is a delicate system of many interconnected parts, any disturbance to one of which can have ripple effects further along the chain. The COVID-19 pandemic proved to be an occurrence of such proportions that it either forced the shutdown of entire sectors of the economy and supply networks or significantly reduced their effectiveness.

The COVID-19 outbreak particularly heavily struck container transportation due to its complexity and transnational nature. Since the pandemic, the shipping industry has had to contend with port closures and traffic jams, labour shortages, issues with capacity utilisation, and a shortage of new shipping containers.

The following is a list of the most important challenges that the freight forwarding industry confronted following the outbreak of the COVID-19 pandemic:

  • Capacity Utilisation: The impact of the COVID-19 outbreak is a critical factor affecting capacity utilisation. As of September 2020, the global container fleet exhibited an unprecedented idle capacity, with around 44% of the worldwide container movement currently subject to extended or even permanent idleness. The industry’s capacity utilisation rate has been declining since before the onset of the pandemic, reaching an unprecedented low of 83% in June 2020.
  • Port Congestion: The COVID-19 outbreak has had significant negative implications for the port sector, with numerous ports worldwide experiencing substantial setbacks due to the pandemic. Since the outbreak, many ports worldwide have experienced unprecedented disruption and delays. In June 2020, port congestion reached a record high of around 18.5%, with 15 ports worldwide recording congestion rates exceeding 10%.
  • Underutilised Capacity: The impact of the COVID-19 outbreak has resulted in a substantial increase in container shipping capacity. As of September 2020, the global container fleet had exceeded new shipping capacity by around 800 thousand TEUs. This was primarily due to a decrease in the number of ships traversing the oceans and the increased size of vessels deployed to service the routes.
  • Freight Rates That Vary: The COVID-19 pandemic has hurt freight rates on a global scale. Between January 2019 and June 2020, freight rates have increased by more than 29%.
  • And below is a further list of how the freight forwarding industry has changed a lot in the past few years:
  • Container freight rates increased because there was no capacity to move containers.
  • Approximately 79% of the world’s containerised goods are shipped by sea.
  • Freight forwarding companies are at the forefront of identifying and addressing capacity challenges because they partner with many of the leading shipping lines across the globe.
  • Even though global shipping rates are rising, there is still room for growth.
  • Key industry members, including freight forwarders and transport service providers, have made great strides in controlling the effects of the coronavirus pandemic.
  • Despite the coronavirus pandemic, global trade volumes are expected to grow in 2021 and 2022.
  • Used containers are being repurposed for various purposes, including new building projects and in the agriculture sector.

The hike in container ship operating costs hasn’t merely been used to offset growing expenditures, despite the increase in freight prices.

According to public statistics, container shipping companies have reported an increase in operating earnings of over 56% in the third quarter of 2021 compared to around 8.5% a year earlier. These gains are used to increase overall carrying capacity by ordering new container ships and purchasing more containers.

As a result, it is clear that the freight forwarding sector has undergone significant transformation in recent years and is now evolving quickly. This benefits the industry by enabling more effective planning and better decision-making.

It’s Important to Stay Up-to-Date with the Latest Changes and Technologies

Due to innovations and new technologies, today’s shipping and freight industries are always changing.

For example, the use of drones for delivery is becoming increasingly common. This opens up opportunities for shipping businesses.

However, these businesses must stay up-to-date with the latest changes and innovations. Otherwise, they may risk falling behind the competition and wasting money on outdated technologies.

Keeping up to date with technology will allow businesses to do what they need to and stay ahead of the competition. Let’s look at how technology is changing and innovating the freight forwarding industry.

  • Analytics: Analytics provide companies with important information that can help to improve their decision-making and supply chain planning processes. These insights can be used to help businesses streamline shipping, reduce costs, and improve efficiency.
  • AI in The Vehicles and Transportation Sector: Artificial Intelligence (AI) is playing a growing role in the vehicle and transportation sector, with numerous companies across the globe using AI technology to boost efficiency and reduce operational costs. This technology is increasingly being used in vehicles and the transportation industry, making it more efficient and flexible. As a result of this, it has the potential to transform the world of shipping and freight forwarding.
  • Automated Technologies in the Shipping Industry: Automation enables shipping companies to reduce operational costs and boost efficiency. Businesses can automate several responsibilities, such as handling tickets, tracking shipments, and meeting inventory requirements. This enables shipping companies to cut costs and boost efficiency to remain competitive in a crowded marketplace.
  • Blockchain: The blockchain has the potential to revolutionise the shipping and freight forwarding. It could enable freight forwarders to carry out a single shipping transaction for thousands of shipments. Businesses will be able to track their shipments and monitor key performance metrics.
  • Consumers Increasingly Prefer to Buy Online: The popularity of online shopping has major implications for the shipping and freight forwarding sector. Consumers can order all types of goods online, including food and medical supplies. Businesses must find ways to ship and deliver their products. Consumers expect their orders to arrive quickly, adding pressure on shipping companies. Consumers are also concerned about shipping and logistics costs, putting pressure on companies to address these issues.
  • Drones: Drones are changing how companies deliver and ship goods worldwide. Drones are becoming more cost-effective and have improved technology, which will allow them to play a much larger role in the future shipping industry. Freight forwarders can easily integrate drones into their delivery and shipping processes and services to provide them with a competitive advantage.
  • Micro-Moments: Micro-moments are actions or activities consumers carry out on their mobile phones that are frequently short and often involve purchasing products. Effective digital marketing campaigns use micro-moments to connect with potential customers and encourage these consumers to complete purchases. These micro-moments should be a part of your shipping and freight forwarding strategy if you are interested in growing your customer base and sales.
  • Optimisation of Shipping Processes and Supply Chains: Optimisation is managing change to make an organisation more efficient and productive. In the world of shipping and freight forwarding, optimisation is used to enhance the efficiency of logistic supply chains by making them more productive and cost-effective. This will enable companies to achieve their business goals faster and more efficiently.
  • The Digitalisation of Shipping Processes and Supply Chains: Digitalisation has a major impact on the shipping and freight forwarding sector. With digitalisation, shipping companies can integrate numerous technologies into their operations and processes, including AI, robotics, and augmented reality. Digitalisation means that companies can now use data to make better decisions, enabling them to lower costs and boost efficiency. There are various technologies available that can help businesses boost their efficiency and compete with their competitors.

So you can see that technology is not only advancing fast, but it has many benefits, so keeping up to date with the latest developments is essential, just like it is necessary for any other business endeavour.

There are a Lot of Different Aspects of the Freight Forwarding Industry 

The freight forwarding industry is a complex and dynamic business focusing on transporting goods worldwide.

A freight forwarder acts as an agent for companies who want to ship their goods internationally. They can arrange for the goods to be kept at a storage facility, shipped by land, sea, or air, and transported by truck, plane, or rail.

Freight forwarders often work with shipping companies, trucking companies, air freight carriers, and railway companies to make sure companies get the best possible prices. However, freight forwarding is more than just arranging transportation.

Freight forwarders also manage cargo and take care of customs clearance procedures. They also help companies avoid potential problems that may arise when shipping internationally.

Below is an informative list of the different aspects that are involved in the freight forwarding industry:

  1. International Air Freight: International air freight involves shipping goods by air from one country to another. It is usually the more cost-effective option for shipping large and heavy items. Air freight can be cheaper, but it may take a while to arrive. Most freight forwarders use air and ground freight services to deliver the goods on time.
  2. International Ocean Freight: International ocean freight involves transporting goods by boat across several oceans. Ocean freight can be cheaper than air freight, but it has some drawbacks, such as being slower and losing cargo to theft or storms. Although ocean freight can be cheaper, it is not always the best option for transporting large cargo volumes.
  3. International Road Freight: International road freight is the transportation of goods by road from one location to another worldwide. This can take several weeks longer than shipping by air or sea, but it is cheaper than these other options. Companies may have to pay extra for crossing certain borders or areas with rough roads.
  4. Freight Forwarding Software: Freight forwarding companies have to deal with the numerous challenges of shipping and transporting products worldwide. These include completing customs clearance procedures, arranging for warehouse storage, and other logistical tasks. Fortunately, they can easily automate a number of these responsibilities with the use of freight forwarding software. This will enable these companies to reduce costs and boost efficiency to remain competitive in a crowded marketplace.
  5. RFID Technology: RFID (Radio Frequency Identification) is a methodology that uses radio waves to identify, track, and monitor packages and other items. RFID technology can be used in many ways and has numerous applications in the freight forwarding industry. Freight forwarding companies commonly use RFID technology to identify containers.
  6. Global Logistics: Global logistics involves arranging for the storage and timely distribution of goods worldwide. This can be a complicated and time-consuming process, which is why many companies outsource these tasks to global logistics experts. Global logistics companies work with freight forwarders and trucking companies to provide their clients with the best possible services.
  7. International Shipping Companies: International shipping companies specialise in transporting goods by sea, air, or road from one part of the world to another. Unlike freight forwarders, these companies do not store goods and may not handle customs clearance procedures. However, they may work with freight forwarders on larger projects that require their expertise. Although shipping companies may be able to provide their services at a lower cost than freight forwarders, their services may not be the best if you are looking to ship large volumes of cargo on a strict deadline.
  8. Cargo Handling: Cargo handling involves properly transporting goods as they are transferred from point to point. Cargo handling can be a complicated process that involves several different types of vehicles and equipment. It includes receiving and handling goods, storing them, unloading them, and loading them for transport to a new location.
  9. Warehouse Management: Warehouse management involves managing the facilities used to store and transport goods. Good warehouse management involves picking, packing, storing, delivering, and receiving goods promptly and efficiently. Many different warehouse management systems automate these procedures and boost their efficiency.

It Will Take Some Time to Understand the Ins and Outs of This Business Fully

Freight forwarding is a wonderful business to get into. There is so much involved in the job that you will be able to grow with your business.

If you are interested in starting a freight forwarding business, you must ensure that you understand everything involved in the job. Freight forwarding companies handle the transport of goods from one location to another.

There are a lot of different aspects to the job that will be crucial to your business, and you will need to ensure that you understand each one thoroughly. When you run a freight forwarding business, you will make sure that goods get from one location to another without getting damaged.

You will be responsible for finding freight companies that will be able to take on deliveries for you, and you will also be responsible for making sure that your clients trust the freight carriers that you hire. You will also need to be considered an expert in shipping regulations, and you will need to make sure that your clients know about these regulations.

It takes time to understand how to get clients, and you also need to ensure you understand how to grow your business.

Experience is Crucial When it Comes to Being Successful in Freight Forwarding

Freight forwarding is a complicated business; without experience, it’s almost impossible to succeed.

They need the experience to navigate the complex world of international shipping and logistics, and they need to be familiar with customs regulations, shipping options, and international shipping laws, as well as need experience dealing with shipping companies, customs agents, and port authorities. They also need experience making shipping arrangements and negotiating with shipping companies.

An experienced freight forwarder needs all of this experience to do their job. That’s why hiring an experienced freight forwarder is important if you’re planning to ship goods internationally. An experienced and reputable freight forwarder will be able to make sure that your cargo gets to its destination safely, quickly, and affordably.

Many Challenges Come With This Career, But it’s Also Very Rewarding

Freight forwarding can be a challenging career, and clients may require different services at different times of day, month, or year. The workload of freight forwarding can be heavy at times, and the industry can be competitive.

However, freight forwarders find these challenges rewarding and, in the long run, exciting. Freight forwarders are passionate about what they do and work hard to become experts in their fields and understand that every job has its challenges. Still, they also know that these challenges make their work exciting and rewarding.


The freight forwarding industry has changed significantly in the past few years, and staying up-to-date with the latest changes and technologies is essential. There are a lot of different aspects to this business, so it will take some time to understand the ins and outs of freight forwarding.

Many challenges come with this career. But it’s rewarding. If you want to learn more about freight forwarding or have any questions, please don’t hesitate to contact us.