In a recent survey tracking the development of online freight sales, we found an interesting paradox: although more freight forwarders than ever are using digital instant freight pricing tools, most of the time they’re using these tools not to reach new customers, but to offer convenience to those already onboarded.
Which raises important questions: To what extent do SMBs looking for freight rates have access to transparent pricing? How can they make the most of available digital pricing tools, and how should digital pricing transparency factor into choosing a freight forwarder?
Let’s dive in.
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Why Pricing Transparency Matters
Freight pricing has become far more transparent in recent years, mostly due to digitization of rates. This means price and service comparisons across providers far easier than ever – and it also means that pricing has become more competitive as the industry has moved toward standardized rates with fewer hidden charges.
“Digitizing pricing has made rates more competitive because they are so readily available and more standardized,” Megan Kelley, VP of Enterprise Applications at Crane Worldwide Logistics, explained in a recent conversation – and that’s a major benefit for SMBs looking to quickly compare rates and cut their decision-making time from days to minutes.
The Limitations of Price Transparency in Freight Quotes
That being said, full transparency is not the standard yet. About two-thirds of the logistics providers we surveyed offer instant ocean freight quotes, but only 38% allow full access to them, without onboarding. The remaining 62% require setting up an account, phone calls, or document vetting in order to see these rates.
What are some of the factors slowing the adoption of price transparency?
One is the inherent complexity of logistics itself. Freight shipping quotes often involve multiple touchpoints, including sea, air, and trucking. In addition, as we know all too well, rates are also impacted by fluctuating regulatory and market demands (tariffs anyone?). This complexity can create difficulty providing transparency.
There is also some hesitancy by logistics providers. As Robert Khachatryan, CEO of Freight Right Global Logistics, explained, “The industry still largely lives inside of email clients and does not seem to be in a hurry to get instant quotes. We seem to be…in the mindset that manual quotes are more nuanced and therefore cheaper than an instant quote online. This is largely due to industry players not providing their best rates online, which then perpetuates the same cycle.”
And then there’s this: the logistics industry has historically run on personal relationships, and that adds a layer of complexity to digitization.
Take this stat: only 20% of forwarders gated their pricing tools in 2021, but that number rose to 65% by 2024. In other words, the technology for digital pricing is here, but our survey suggests that forwarders are more interested than ever in maintaining relationships in an industry rocked by volatility over the past few years.
The good news is that it’s possible for logistics providers to both automate what they can and still provide the personal touch that makes their services so invaluable to importers.
Challenges for SMBs
For SMBs, the relatively slow adoption of transparent, digital pricing means getting a quote can still take a lot of time and back and forth with different providers.
Additionally challenging, if digital quotes are gated, SMBS must undergo onboarding processes with multiple companies, which is very time-consuming.
And, different forwarders use different systems, each offering different levels of access and functionality, which means comparing quotes is a patchwork process (unless you use the Freightos Marketplace of course!).
For SMBs, this means extra time spent shopping around, as well as greater friction building budgets or adapting to the market’s rapid changes.
That said, there are many ways SMBs can use existing digital tools to save money and streamline operations.
Actionable Tips for SMB Importers: How to Make the Most of Digital Freight Tools
The freight world is still in the process of digitizing. But here’s where forward-thinking SMB importers can use digital tools in freight operations:
Seek instant quotes
More and more freight forwarders are offering instant digital freight quotes. Seek these out to save time and get a clearer picture of the market rates, without having to wait for callbacks.
Find and use self-service platforms
It’s not just instant pricing that can build savings and efficiency: look for forwarders that offer comprehensive features like online booking, customs management, and shipment tracking. These tools enhance convenience and give you more control over your shipments.
Value both speed and service
While digital tools offer speed and efficiency, make sure to also assess the customer support offered by forwarders you’re considering. Providers that combine digital efficiency with excellent customer service can help handle exceptions and urgent issues effectively.
Explore sustainable shipping options
Consider using digital platforms that offer insights into CO₂ emissions or other sustainability metrics. Opting for greener shipping methods where possible not only aligns with sustainable practices but also helps meet the growing consumer demand for environment-friendly solutions.
Provide feedback
Engage with forwarders that invite customer feedback during the digital booking process. This level of interaction often indicates a forwarder’s commitment to continuous improvement and can result in better services for you.
Try a Freight Marketplace
The Freightos Marketplace allows you to search instant freight quotes across dozens of providers – and then book, pay for, and manage your shipment right on the platform. You can also instantly add services like customs and insurance. No matter which freight forwarder you choose for each shipment, you’ll be able to consult with them easily, building that relationship and benefitting from their expertise and experience.
Taking advantage of digital tools not only helps SMBs navigate the sometimes-tricky world of freight more smoothly – it also gives them a hand in shaping how the industry embraces transparency and better service. By seeking out and using these tools, SMBs can ensure they’re getting ahead – while letting providers know that importers value these tools.
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