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Are forwarders inevitable but useless middlemen in the supply chain

The Shippers’ Voice has long advocated more meaningful and cooperative relationships between shippers, carriers and freight forwarders. The adversarial nature of the relationships can prevent the optimum solutions being found, with too much focus on hard-nosed negotiation over price rather than service.

The Shippers Voice Forum, an open group on the networking site LinkedIn, recently began a conversation on this subject, started by an experienced freight forwarder, Georgi Stoilov.

He said that this adversarial relationship was "strange…as we both work for the same purpose, to have goods delivered on time for the negotiated price."

He continued: "Customers (I prefer this to shippers because much of the transportation is FOB and EXW driven) very often view freight forwarders as inevitable but useless middleman in the supply chain and many forwarders continue to work in a way to support this impression.

"However I don’t believe this should be the true relationships between the parties."

Mr Stoilov wrote on this issue (‘Do forwarders understand their customers’ http://kgsid.com/do-forwarders-understand-their-customers ) in January 2011. The ‘blog’ focuses on a survey undertaken by the on-line news service from Eye For Transport which depicted severely contrasting views between shippers and forwarders as to why shippers change their 3PL provider.

This week Mr Stoilov commented to The Shippers’ Voice that "Obviously we forwarders still continue to operate the way shippers and consignees expect from us – adversarial, heavy negotiation approach (with both carriers and the shippers). From the other side our customers rarely understand or want to understand what the forwarder is doing and that our job is not being pure agents on commission but architects and designers of the supply chain."

The Shippers’ Voice recognises the problem, even though many shippers will comment that they have good, solid relations with their freight forwarders. But it seems there is a mismatch between what people say and what actually happens. Therefore it is important to air this issue further and get shippers and freight forwarders to examine their relationships more closely. An adversarial relationship is less likely to result in optimum solutions being found and sustained, and in this day and age that can cost you dearly and lose you competitive advantage.

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