Is it interesting to work in the freight forwarding industry? From a Senior Managers perspective.
We need to be aware of global trade and supply chain issues affecting the movement of goods. We need to be aware of free trade agreements, customs requirements and documentation, port handling requirements pertaining to hazmat and cold chain, and understand trade financing for customers complying with letter of credits.
On the sales side, there is high pressure to increase revenue, volume and profits in a market that is saturated and highly competitive with few USP’s. There are demanding customers who don’t always know what they want, don’t always understand freight forwarding, and constantly try to reduce cost. Customers often demand a high level of service at low rates, however tend to pay late for this service. And the odd customer will call you at 11pm at night to understand where their shipment is. Sales need to work with regional and global teams to manage key accounts, and work with other subsidiaries or agents to grow specific tradelanes. The tender management teams needs to fill out endless lines in RFQ excel sheets and legal/risk/insurance needs to be consulted on contractual clauses. Every customer is unique, but at the end of the day they use the same container, on the same ship, sailing on the same water.
Operations bargain with the trucker to be at the customers warehouse at a very specific time, chase the ocean freight carrier for the bill of lading, haggle with the airline to ensure cargo is uplifted – even at late hours on a weekend, and they coordinate with overseas offices to ensure suppliers’ shipments are consolidated into the same container. Sometime we need to arrange an off-shore delivery during a public holiday when no one is around. Operations often chases sales for a copy of the customer quotation and any handling details mentioned by the customer. Occasionally they need to be insurance experts when customer claims arise. Operationally the pressure is high to complete milestones and do so within the specified KPI’s. Productivity relies on their proficiency using ERP’s and Microsoft office tools.
Procurement needs to bargain to reduce cost while maintaining a specific service level. They need to be well connected to operations to understand current demand, and be connected to sales to understand future demand. They need to be connected to the market to understand trends and carrier strategies.
Financially there is constant pressure to ensure a healthy cashflow. Sales need to be chased to ensure AR’s look healthy, AP’s need to be settled on time to ensure the vendor doesn’t stop working with us, operations needs to be chased to bill accurately on time, to generate mid-month revenue and GP forecasts, and perform month end closing. When there appears to be revenue leakage operations needs to be chased to perform deep dives. There needs to always be sufficient cash in the account to settle sudden large customs outlays for duties and taxes, or the occasional charter shipment. Besides the day-to-day accounting which includes netting, there’s the financial forecasting, monthly reporting, budgeting, monitoring OPEX and coordination with treasury. Occasionally Finance will help management with an investment request that includes CAPEX, from a new truck, renovation or a new branch office.
For HR, there is a constant movement in staff. Like any other industry freight forwarders hire people straight out of university up to senior management levels. Low to mid-level staff tend to move regularly, especially in high stress environments. While working in the freight forwarding industry is very rewarding in terms of gaining knowledge about different industries, global trade, different cultures, the pay often doesn’t seem to commensurate with the working stress level. HR is therefore always busy with the usual comings and goings, but also with strategic initiatives trying to attract new staff. And sometimes HR has to assist staff that want to relocate to the other side of the planet. For staff motivation HR arranges parties, gatherings and events around health and sustainability.
On the compliance side there is financial compliance where we need to comply with rules on transfer pricing and anti-corruption. Operationally we need to comply with customs regulations, ensure QMS, schemes and licenses are adhered to and lived, and ensure we adhere to laws regarding sanctioned parties and countries. In terms of QC, compliance will chase operations to capture those NC’s, perform the RCA and issue and close out CAR’s – all before the customer gets frustrated.
On the management side we need to ensure all these components are aligned and work together smoothly, implement regional/global plans, guidelines and budgets, provide short/mid/long term direction and goals, give staff the tools they need to complete their jobs, hold townhall gatherings answering any questions the staff has, troubleshoot and engage when issues arise – internally or externally, ensure a healthy working relationship with regional and global teams, as well as the global network of branch offices, be the main marketing officer of the company and the branch/subsidiary, and ensure all regulatory requirements are complied with. At times we need to roll up our sleeves and read customer SOP’s, tackle alignment issues between operations and sales, or operate the forklift. Occasionally we work with legal to sue a customer that doesn’t pay, sign a block space agreement with an airlines, approve payments to vendors and the payroll or create a business case for the setup of a new branch or department. All in all, as senior management we are expected to know everything and always be encouraging, motivational, positive and accessible.