As they navigate through the latter half of 2023, freight forwarders are vigilantly eyeing three primary business challenges: the looming spectre of a possible recession, intricate geopolitical risks, and the escalation of operating costs. However, they are maintaining a buoyant outlook amid this complex landscape, anticipating an upswing in volumes within the forthcoming 12 months. This is according to a recently published study by Transport Intelligence (Ti) that delves into the state of global logistics.“Freight forwarders remain optimistic,” reads the report, “with the majority expecting to continue seeing air and sea freight volume increases in the next 12 months.”At least 40% of respondents indicated that air volumes had increased from 1% to 25% in 2022. Remarkably, an equivalent proportion of respondents anticipated identical increases in the coming months. As with airfreight, optimism was also high for the sea freight market, with over a third of respondents expecting volume increases of as much as 25%.“These upbeat forecasts may come as a surprise, particularly amid the pessimistic outlook for the global economy this year,” states the report. “But there is solid ground for cautious optimism about air and sea cargo. While the first half of the year will likely remain gloomy and weigh down on air and sea freight volumes, respondents are convinced that the global economy will recover and hence volumes will continue their upward trend.”On the downside, freight forwarders reported growing pressure on margins. Excluding volume and rate f luctuations, more than 60% of forwarders surveyed by Ti said margins would worsen over the next 12 months. Rising competition and more robust client negotiations were the main reasons for the increased pressure. Leveraging technology and offering more value-added surveys were seen as the most successful strategies in pulling back eroding margins.Access to technology, however, was considered the most critical challenge currently affecting global freight forwarding.While the importance and need for more technology was highlighted, the study found that access to technology remained difficult for numerous entities. While technology investments are now recognised as pivotal for enhancing efficiency and intelligence in logistics operations, attaining access to such technology proves challenging for various reasons. Implementing new solutions still entails substantial costs, and the persisting shortage of skilled personnel exacerbates the issue.
