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Global Logistics: Freight forwarders maintaining their speed

By Patrick Burnson, Executive Editor
October 01, 2012

Holiday gifting
For Barnes & Noble, the U.S. manufacturer of the “Nook,” selecting the right freight forwarder for its launch into the U.K. has been key. Without naming the chosen provider, Dan Gilbert, Barnes & Noble’s executive vice president of operations, says the EU-based intermediary has a global reach and proven track record.

“We fully intend to take the ‘Nook’ into the international marketplace,” he says. “But we wanted to start with Great Britain to begin with. We work with a variety of logistics partners within the U.S., but we needed a highly specialized player for this major move.”

Sophisticated shippers know that high-end consumer goods and high-tech gadgetry—like the Nook—requires flexible and resilient supply chains best served by leading international forwarders. But the detailed and underlying implications of that fact may not be so obvious. The latest report from the London-based research company Transport Intelligence (Ti) maintains that shippers should remain ever vigilant when evaluating forwarders.

“As companies compete on the thinnest of margins, those that are the quickest to adapt and innovate are the ones that not only survive in this highly competitive industry but are among the leaders within it,” says Ti analyst Cathy Roberson.

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While the overseas launch of the Nook is significant, Roberson points to Apple’s introduction of the iPhone and iPad as being truly transformational.

“The entire supply chain has undergone great changes—from the original equipment manufacturer (OEM) to the contract manufacturer, distributor, retailer and finally to the end customer,” she says.

These changes have resulted in shifts in manufacturing locations and transportation modes as well as shifts in business strategies. For many OEMs, there has been greater emphasis towards software as opposed to hardware. Freight forwarders have responded to these changes by introducing specialized solutions to meet the industry needs. Niche forwarders have also emerged, especially those providers that work mostly with high tech companies.

“The high tech logistics market is a large and diverse one. Although it has grown at a healthy clip since the 2009 economic downturn, it’s in danger of slowing once again thanks to yet another weakening of the global economy,” says Roberson. “As mature markets such as the U.S. and Europe remain important to the consumption of these goods, it’s the emerging markets of Asia, South America, and the Middle East that are spurring future demand for the latest devices.”

Roberson says shippers are asking forwarders to provide a variety of modal choices as they reconfigure supply chains to cut cost. Some shippers opt for less expensive means of
transportation such as ocean and, in some cases, even rail service.

“Still, for many air cargo providers—particularly those that operate along the Asia Pacific trade lane—there has been an overdependence on high-tech product launches over the years,” she says. “And due to the rise of oil prices, the shift towards ocean freight and slowing demand, over capacity issues have occurred.”

About the Author

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Patrick Burnson
Executive Editor

Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at .(JavaScript must be enabled to view this email address).


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