AI in Freight Forwarding: 9 Effective Ways to Improve Operations

How AI in Freight Forwarding Improves Operations

Here are the advantages that Artificial Intelligence (AI) offers for freight forwarders:

1. Automating Compliance and Document Processing

AI allows freight forwarders to process large volumes of data in minutes!

It can extract and organize information from invoices, emails, contracts, and other important documents, like a bill of lading or air waybill. This effectively reduces the need for manual data entry, helping freight forwarding companies avoid human error and save time!

What’s more?

AI can automatically check whether the documents meet local or international trade regulations, such as customs duties and restrictions, to ensure shipments go smoothly. You can also automate AI to check for sanctioned entities, export restrictions, and embargoed destinations to prevent delays or fines due to non-compliance.

2. Optimizing Route Planning and Shipment Management

AI-powered algorithms can analyze datasets to help freight forwarders determine the most efficient shipment routes. It takes into account factors like:

Real-time traffic conditions (like port congestion)
Weather forecasts
Potential delays
Fuel consumption

In doing so, it aids route optimization, improves delivery times, and boosts service reliability.

But it doesn’t end there.

Here are other aspects of supply chain management that AI systems optimize:

To make shipments cost-effective, AI automates the planning and arrangement of packages for optimal shipment consolidation. This ensures more cargo is delivered in one journey while also arranging them based on destinations and due dates to streamline delivery.
Freight shippers can use AI for predictive maintenance, which identifies potential issues and alerts you to fleet maintenance or repair requirements in advance. This helps reduce repair costs and possible downtime.

3. Enhancing Freight Quotes

Need help generating up-to-date quotes?

You can leverage AI capabilities, like predictive analytics, to create accurate freight expense calculations based on historical and real-time shipping data, like fuel costs and delivery estimates. Moreover, AI technology can automate the end-to-end quoting process, from reading emails and extracting data points to pulling carrier rates and creating an email with the quote.

This can save a freight forwarder from hours of data entry and research.

For example, freight forwarding software like Shipthis has quote management features that let you generate detailed quotes, email them to customers, and monitor their status.

4. Enhancing Inventory Management

AI can optimize inventory management through demand forecasting and analyzing market trends. This helps you adjust inventory levels and distribution strategies for better resource management.

Freight forwarders can also use AI to automate manual processes, like measuring, weighing, and photographing cargo about to leave the warehouse. This data and the label information are then stored in your freight management system, helping save time and verify regulatory compliance.

5. Automating Carrier Matching

AI applications help optimize the supply chain by automating carrier matching. It allows a freight forwarder to link shippers with carriers based on variables like:

Cost
Load size
Route
Capacity
Proximity
Quality

This drastically reduces the time needed for carrier selection as AI automation helps verify bids and pinpoint the best deal for your criteria.

6. Faster Carrier Contract Management

Uploading carrier rate contracts into rate management systems becomes a matter of seconds.

Not only does this save you time and manual labor, but it also reduces opportunities for errors.

Here’s how: The AI tool scans the carrier contracts and accurately inputs the data into rate management software. It expedites hours of manual data entry.

7. Improving Risk Management

Freight forwarders can use AI technology to the potential risks involved in cargo movement with specific carriers or on certain routes.

The AI analyzes historical data to assess the reliability of your options, including:

Flagging possible delays based on carrier performance, route traffic, weather conditions, and potential disruptions.
Catching possible breaches or changes in international trade regulations early.
Preventing unexpected breakdowns by predicting fleet maintenance requirements.
Identifying patterns linked to cargo fraud or suspicious activities.

8. Enhancing Customer Experience

Many of AI’s benefits for freight forwarding enable better shipping experiences — enhancing the customer experience.

Here are some aspects that help improve customer satisfaction:

Real-time tracking of shipments offers enhanced visibility and updated estimates on delivery ETAs.
Route optimization allows for faster and more cost-effective deliveries.
Personalized solutions based on the customer’s past requirements and preferences.
Round-the-clock customer support via AI-driven chatbots and automated response systems.

Take, for instance, Shipthis. Its customer engagement portal helps freight forwarders connect with and share contextual alerts with customers.

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Does this all sound too good to be true?

Well, AI applications aren’t without their flaws. Read on to explore the potential downsides of implementing AI in freight systems.

Challenges of Implementing AI in Freight Forwarding

The benefits of using an AI algorithm come with certain downsides, including:

Data requirements: Generative AI solutions like predictive analytics and personalization are data-driven, meaning they depend on the availability of vast amounts of data. They require this data to learn how to interpret the information and make accurate, reliable predictions or decisions. The problem? Small to medium-sized freight forwarding companies may not have the data required by the AI tool for machine learning.
Data security: Freight forwarding operations contain sensitive data about customers, transactions, and logistics. Companies adopting AI solutions should ensure their tools have the appropriate data security to protect against breaches or leaks.
Integration of AI with existing systems: AI tools are invaluable. But are they worth a complete overhaul of your current systems? Businesses need to select an AI-powered tool that seamlessly integrates with existing software systems. However, this process can be painstaking and time-consuming if you aren’t well-versed with your business and system requirements.
Skill development: Adopting AI also means you need to train employees to handle its use in accordance with the workflow. After all, an AI algorithm can’t completely replace your workforce.
Regulation: AI adoption across industries has spurred a myriad of regulatory challenges to navigate its impacts on customers, hiring, data security, and supply chain operations. This can make its adoption more complicated and expensive.

Wondering if these challenges will impact AI’s growth in freight forwarding?

Read on to explore future applications of AI in the logistics industry.

The Future of AI in Freight Forwarding

Here’s a peek of what’s on the horizon for AI:

Fully autonomous vehicles: Although mostly limited in range, the logistics industry could see the advent of completely autonomous vehicles for freight transport. This would drastically reduce manual labor and enhance safety.
Enhanced customs clearance: With greater development and adoption, generative AI could learn to use natural language processing more efficiently. This could lead to better processing of international trade laws and implementation of regulatory changes. The result? Easier checks to ensure customs clearance.
Smart warehousing: AI-powered and IoT devices could help make inventory management more efficient. They’ll handle everything from predicting inventory levels or requirements to automating replenishment.
Blockchain integration: AI could integrate with blockchain technology to enhance documentation and security processes.

After the future of freight forwarding, let’s review whether you’re in need of AI adoption.

How to Know if Your Freight Forwarding Company Is Ready for AI

Here are signs your logistics company could benefit from AI adoption:

Inefficiencies in your current systems lead to elevated operational costs. For example, increased labor costs due to manual processes or overstocking due to poor inventory management. In that case, adopting AI could help streamline your operations and prevent unnecessary costs.
Your operations see frequent delays due to insufficient resources for efficient route planning and real-time data analysis.
Your business needs to catch up to competitors and adapt to market conditions.
Inaccurate resource and demand management leads to reduced operational efficiency.

Need an easy solution for implementing AI into your supply chain operations?
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We’ve got the perfect one for you!

Shipthis: Software that Brings AI to Freight Forwarding

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Shipthis is an AI-powered tool that covers all aspects of freight forwarding, including shipment management, regulatory compliance, eAWB submissions, and more.

Its key AI features for the freight forwarding sector include:

Improve freight management with Magic Drop, which scans and validates supply chain documentation to enhance the movement of goods through customs.
Automate data entry, repetitive tasks, and workloads to boost logistics productivity with an intelligent AI copilot.
Streamline invoice processing and expense management for error-free and efficient accounting with Onder AI.
Stay on top of logistics management with an AI-driven parser that automatically processes shipment-related emails and updates the details in your dashboard.

There are also tons of other useful features to improve freight operations. Request a demo to see how Shipthis helps with AI adoption for improved freight management.

Pricing: $89 for all our modules, including freight forwarding, customer relationship management, accounting, warehousing, quotation, and more.

Leverage the Potential of AI in Freight Forwarding

With the digital transformation of the freight forwarding industry, AI capabilities have become more of a necessity than a luxury. From compliance automation and supply chain management to satisfying customer expectations, it helps drive efficiency and reduce operational costs.

However, a logistics company should select software that works well with its current systems.

Enter Shipthis, a freight forwarding software that harnesses the power of AI to simplify logistics operations. It can easily integrate with systems to simplify AI adoption and help your business stay competitive in a rapidly advancing freight industry.
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So, don’t get left behind — book a demo to see how Shipthis helps businesses unlock the full potential of AI in freight forwarding operations.

AI in Freight Forwarding: 9 Effective Ways to Improve Operations

1. Automating Compliance and Document Processing

2. Optimizing Route Planning and Shipment Management

3. Enhancing Freight Quotes

4. Enhancing Inventory Management

5. Automating Carrier Matching

6. Faster Carrier Contract Management

7. Improving Risk Management

8. Enhancing Customer Experience

More Questions?
or Let’s just connect!

Hear from
our Experts

AI in Freight Forwarding: 9 Effective Ways to Improve Operations

1. Automating Compliance and Document Processing

2. Optimizing Route Planning and Shipment Management

3. Enhancing Freight Quotes

4. Enhancing Inventory Management

5. Automating Carrier Matching

6. Faster Carrier Contract Management

7. Improving Risk Management

8. Enhancing Customer Experience

More Questions?or Let’s just connect!

Hear fromour Experts

More Questions?
or Let’s just connect!

Hear from
our Experts