Platforms like Uber or AirBnB have changed our daily lives enormously. Entire industries are undergoing transformation. Hotels and taxi companies see platform businesses as big competitors. Scenes in which taxi drivers throw stones at uber-users went viral.
But how is a company without vehicles able to compete with the taxi industry? AirBnB also has no own “assets” of its own, as it is often called in the business world.
What is it that makes these companies so successful? The answer is quite simple: they connect.
But what does Uber or AirBnB have to do with the logistics industry? In this article, we show you how logistics platforms work and how your company can benefit from them.
What are logistics platforms?
Generally speaking, a platform connects two or more parties and creates value for all parties. A very simple example are newspapers: it connects subscribers with advertisers counters. In the broadest sense, credit cards are platforms too: they bring together consumers, banks and merchants.
Today, many successful business models are online platforms. And there’s a reason for that. Facebook, Google, Tripadvisor, Uber, AirBnB, Ebay, Amazon, … – to name just a few.
In logistics, platforms unite shippers and carriers. The so-called digital freight forwarders bundle demand and supply.
Platforms also have the advantage of network effects: the more carriers are registered on the platform, the more attractive the platform becomes for shippers. This concept applies vice versa: the more orders, the more exciting the platform is for carriers.
“This development will affect the transport of all types of freight that can be easily standardised, such as the transport of complete loads or pallet goods”. This is the assessment of a expert group, consisting of established representatives of the forwarding and logistics industry as well as start-ups.
4 positive effects platforms have on your supply chain
Digital freight forwarders have long since ceased to be startup visions, but are of great importance to logistics companies when it comes to optimising processes or finding available transport capacity.
- Easier communication: The digital freight forwarder is contract and contact partner for both shippers and carriers. This means that shippers always know who to turn to if they have any questions about their delivery. The digital freight forwarder bundles all information of the carriers, so that the shipper only has to make one call and not more than 10.
- On a large scale, platforms are more efficient: A logistics platform can achieve attractive economies of scale with increasing size. Digital forwarding agencies are therefore also well suited for shippers with large transport volumes.
- Higher market transparency: A logistics platform offers customers higher market transparency and makes it easy to compare the services of different carriers. Customers receive the optimal offer faster than if they personally request offers.
- Access to always available transport capacities: A platform bundles the capacity of many small carriers and thus always knows where loading space is available.
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