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Tips for LSPs Navigating Changing Shipper Needs in 2024 with Rose Smith
81 Plays1 year ago
In this episode of supply chain connections, we're sharing a recording from a recent webinar hosted by Brian Glick, CEO, and Rose Smith, VP of Customer Success, at Chain.io. In this episode, Brian and Rose explain the evolving shipper needs LSPs should be aware of as we move into 2024 including:
- The different requirements of shippers based on their size and complexity
- What shippers are focused on post-pandemic
- The importance of maintaining relationships during a downturn
- Innovation, sustainability, and compliance across supply chains
- Three main motivations for shipper sustainability
- Trade compliance challenges and opportunities for LSPs
Rose Smith recently joined Chain.io as our VP of Customer Success, where she leverages her supply chain expertise building large scale digital solutions to drive innovation with our customers. Prior to joining Chain.io, Rose held pivotal leadership roles as Senior Director of Supply Chain Operations for iRobot and Head of Supply Chain Development for the LEGO Group. In these roles, Rose played an instrumental role in strategizing, implementing, and evolving supply chain frameworks.
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Transcript
Introduction with Brian Glick and Rose Smith
00:00:05
Speaker
Welcome to Supply Chain Connections. I'm Brian Glick, founder and CEO at Chain.io. This episode, we're going to do something a little bit different. This is a recording of a webinar that we did recently where I discussed with Rose Smith, who is our head of client success, all about the expectations that shippers have going into 2024 from their freight forwarders. So this one's going to be a little bit more content heavy and a little story light. If you're interested, I hope you enjoy the episode.
00:00:35
Speaker
Rose has an incredible background coming from different shippers like Lego and Lowe's and iRobot. So really interesting stuff and we hope you enjoy it.
Communicating with Shippers: Insights from Brian
00:00:55
Speaker
Hi everyone. Thanks so much for joining today. We're going to go ahead and get started.
00:01:00
Speaker
I'm Molly Evola. I'm the marketing manager here at Chain.io. And we're really excited to talk about everything you need to know to meet shipper expectations in 2024. Today, you're going to hear from our CEO, Brian Glick, and our VP of customer success, Rose Smith. I'm going to go ahead and pass it over to Brian to introduce himself and kick this thing off. Hi, everybody. So I'm Brian Glick. I'm the founder and CEO here at Chain.
00:01:25
Speaker
won't go through my whole history, but you know, important for this is that I spend a lot of time out in the industry talking with our customers, our customers, customers, and trying to get a gauge on what's going on, not just the technology, but also how forwarders need to talk with shippers. And so I'll let Rose introduce herself who is our stand-in for shippers today. Thank you so much, Brian. Yes, I'm Rose Smith.
00:01:50
Speaker
have joined Chain.io recently and so happy to be here. My history spans from many retailers and manufacturers. So hopefully I can give a really great perspective going into 2024.
Understanding Shipper Segments: Rose's Perspective
00:02:03
Speaker
First thing we're going to talk about is something that's probably on the top of everyone's minds and that is rates. Funny thing is we're actually not going to talk about rates today because obviously this is something that is mostly a concern and more of the obvious answer. So we've got rates, then rates, then rates, then. Dope.
00:02:23
Speaker
Just very quickly before we dive into the topics and we promise this is the only part of this that's anything about us just to give a little context of why we're in a position to have this conversation. So as a supply chain integration network, we spend our days talking to these various software companies and transportation providers and all these different packages and companies that were connected to
00:02:47
Speaker
which just gives us a unique perspective on getting this very cross cutting view of the industry so our job in the industry is to be neutral and is to help all of these companies work with each other and with shippers and with forwarders and carriers so. The only thing we're talk about today about chain so we can move on very quickly from that so this slide just and i like rose to kind of dig in a little bit here but.
00:03:14
Speaker
Just like there are no two forwarders that are the same and, you know, approaching a one office forwarder and asking for a similar thing that you would get from bear logistics would seem silly. We can't talk about shippers as if they're one giant group of people. So we think of them really in these three segments, the numbers of shipments is very kind of arbitrary, but there's a moment I like to think of it as the ones that just have a spreadsheet.
00:03:42
Speaker
the ones that are struggling to grow and then the ones that have a whole process. Rose, do you want to talk a little bit about your thoughts in these categories? Yeah. One of the things that we were discussing in preparation for this is how different shippers have different requirements and therefore different expectations.
00:04:01
Speaker
There are going to be those that are potentially smaller. Like Brian said, we can't always just go to size, but potentially smaller that just want things on time and easy. And that's their main concern where they probably are doing this off of spreadsheet or even just using their phone. And then there's the slightly larger shipper who is more concerned usually with cost optimization, going back to that rate conversation.
00:04:26
Speaker
and they just want things to execute and they want it to be somewhat seamless. This is where we get into more connectivity, but still there is additional connectivity and absolute connectivity involved with the larger shippers who are not able to look at that single shipment or make sure that special thing is getting there. They need everything to get there and they need it to be
00:04:52
Speaker
where they're not worried about any single one of them unless absolutely necessary. As well, they're looking at forecasting and understanding the long-term horizon instead of just the immediate future. We sorted them into these three categories just for some simplification. To add a little bit of layer on top of that, when it comes to the ones in the first category that the small ones, the on-time and easy,
00:05:17
Speaker
This is where the investments in the websites, the portals, the online booking and quoting really pays off, right? So when we look at it, investment strategies with our customers across, you know, the first question we always ask is who are your customers, right? And if your customers are in that smaller segment, then giving them that omni-channel experience, giving them that ability and really the,
00:05:43
Speaker
consumerization of that omnichannel experience becomes really important where as we get to the right, this is where being able to say, hey, we're going to do PO-based exception management and we're going to do advanced analytics and network design planning and mode shifting and all of these things that all of us freight nerds love to talk about are great. I have a personal experience with a friend of mine who does maybe a hundred containers a year tops.
00:06:12
Speaker
And she's gone to forwarders who have started with that conversation. And she's just like, she wants the FedEx parcel experience, right? And she wants to be able to just say, I have this factory that gets me my stuff and can you just get it there? And I need it and Target needs it on July 3rd. So can you please make sure it's a Target on July 3rd and just promise me that's going to happen and I never want to speak to you again. And so it's important to remember.
00:06:37
Speaker
who you want to sell to in positioning your conversations next year and potentially varying your roadmap that you're showing your customers based on which pieces of it are important to them. So I'll take the beginning of this and Rose will take the end, I think. We wanted to put a little bit of perspective on the last
From Differentiation to Navigating Chaos in 2020
00:06:57
Speaker
few years because
00:06:59
Speaker
There was this period in 2018, 2019, we were all very excited about technology as an industry, but we were excited about that in a world that was relatively stable. You know, we had the beginnings of the sort of trade wars with China and the US starting, but nothing like what we found out we were going to experience. And so conversations with customers are very much about how do you differentiate yourself when everything feels the same.
00:07:25
Speaker
And then we hit chaos, right? So we hit the beginning of 2020 and the lockdowns and certainly things I don't need to remind everyone of. And our conversations with our customers or your conversations with your customers more specifically were just navigate me through this chaos, get me capacity, get me space. I want you to innovate, but I don't want to hear about your innovation for innovation sake. I just want Molly picked this, this nice dumpster fire icon for us. I just want you to put the dumpster fire out. And then Rose, do you want to maybe pick up the second half here?
00:07:52
Speaker
Yeah, exactly. So coming out of that period of chaos, and even as a consumer, it felt pretty chaotic not knowing if you were going to get your package on time, even worse for the larger shippers who wanted to be able to service the customer, their consumers in a timely fashion. We then went into this downturn where the economy started to stumble and
00:08:18
Speaker
The need for capacity wasn't quite slowing. It was more just like up and down, up and down, up and down. What do we do? We built all this capacity in. A lot of people changed suppliers for their logistics providers.
00:08:33
Speaker
And now they're in a situation where they're potentially in a new relationship. And then it went back to how do we go back to feeling this status quo? How do we go back to that? Okay, things are starting to smooth out a little bit, not necessarily in a positive way with the demand going down.
00:08:50
Speaker
But then how do we manage all of this? How do we make sure we can start to give those forecasts to the religious six providers to make sure that they don't over underestimate the amount of capacity necessary or even the amount of truck drivers they need to have. And right now we see ourselves going into a period of recovery where it is starting to feel like relationships are being rebuilt, expectations are being set at a much calmer pace than they were during the pandemic.
00:09:19
Speaker
And there's overall starting to be an evening of demand. And hopefully, obviously, we all hope that that recovers truly and comes back up, but that there isn't so much chaos going into the future. And I think what this means, if you're out there talking to your customers about next year, is that this, the ones that you've retained through the downturn.
00:09:41
Speaker
So we did a presentation a couple of years ago at TPM with a shipper and myself where we were discussing how she had gone from three forwarders to, I don't remember the exact number, but it was more than 10 forwarders that she was using.
Retaining Long-Term Customers Post-Downturn
00:09:57
Speaker
And as I talked to her intervening through the downturn, she paired that number back. So everyone saw their number of customers increase in their master data.
00:10:09
Speaker
and then probably contract again. But the ones that have stayed, the ones that you've been able to maintain, the key now is to make sure that those investments become the 20-year customers. So we start thinking again the way we were thinking in 2018 about going out to your customers and talking about long-term projects and long-term value again and getting out of this firefighting mode.
00:10:37
Speaker
So, you know, what we have to be careful about is, you know, and I'll be the first time we mentioned AI and we'll see if it's the last time in this, but like, not just walking into these customers who have gone now through this downturn in this chaos period and are a little smarter than they were in 2018, not just walking in and going, Hey, AI, we're going, here's the value that we want to bring to improve your on time in full and how we're going to use a technology like AI to solve that. So I think the market and the buyers at the customers.
00:11:07
Speaker
from a technology perspective, at least.
00:11:09
Speaker
they've gotten smarter about, you can't just wave the buzzwords at them. It used to be you could say API and then not really even know what that meant as a salesperson. And it was okay. And they were like, oh, API, yes, you must be modern. Now they're saying, okay, what's the ROI on that? Because I'm either in or coming out of a downturn. And I have to go back to my CFO and talk about my spend and why I want to pay this freight forwarder more than this other freight forwarder because they're bringing this added value.
00:11:37
Speaker
and you have to help them understand how to tell that story to their cfo right to say okay we have chosen to spend more money and i see rose trying to jump in so i'll let you finish the thawers.
00:11:49
Speaker
Yeah, I was just thinking about the initial slide we started with as well because one of the things we didn't highlight there yet was as the maturity has come about in the industry because of the chaos, right?
The Vital Role of Shipment Visibility for Shippers
00:12:03
Speaker
Like you said, Brian, now everyone is a bit more experienced. They have more knowledge. They're more focused on ROI, but there's also this need for the customers to, they all at least want to know where their stuff is.
00:12:18
Speaker
And that is whether they're shipping 10 things, 10 shipments a year or, you know, 100,000. They all want to know that one.
00:12:25
Speaker
thing? Where is it? Is it going to be on time? Am I going to be able to service the retailer or their own customer, their own consumer on time? And I think that is where that innovation and sort of support that maybe previously wasn't immediately offered is a massive benefit here because it's almost like a relief, especially when it is then going to service the customer's customer. No one wants to answer Walmart
00:12:51
Speaker
when they ask, where's my stuff? That's not a good position to be in. And I think that there used to be a lot more flexibility in that space for suppliers to sort of be like, okay, you're a smaller supplier, therefore, we'll give you a little bit of wiggle room. But now it's just the fact of the matter. Everybody wants to know where it is at the very least. And being able to provide that on behalf of the logistics provider customers in order to so that they can pass it along to their customers.
00:13:20
Speaker
And I think where that especially jumps in is when we're talking about that segmentation, it's that middle segment that really is struggling and where as logistics service providers, not just freight forwarders where we can really in the coming year, help in that visibility space is those mid market customers, right? The big ones are going to assume you can do it and they're going to, you know, and as,
00:13:50
Speaker
capacity and schedule reliability has normalized on, you know, both air and ocean, you know, air is definitely in a high over capacity situation right now. So should not be hard to move things on time via plane and ocean blank sailings, all of these things. It's always a little challenging, but it's certainly, we're not at down in those 10 and 20% schedule reliability that we're at. The big guys are just going to assume you can do it. And they're just going to yell at you if you can, those mid market customers who don't quite have their heads around how to work with their bigger customers.
00:14:20
Speaker
They're the ones that you can go to and say, you've now grown out of using our website and logging into our website 20 times a day. Let's get a connection. Let us connect to your customer on your behalf. Now you've got a stickier customer. You've got a long-term customer. You've got some rate resiliency in your contract because you've got that integration. So moving those customers that are in that transition period is where we think those will be your large customers 10 years from now.
00:14:50
Speaker
It supports the growth of everyone involved. It allows that to grow at all, really, because if they didn't have the capability in the past, then they do.
The Future of Emissions Reporting and Sustainability
00:15:00
Speaker
It's just a better situation for everybody. I think that was our cue that we have to keep moving because Rose and I will do this for a long time. The one topic that doesn't wedge into anything else and that we think if you want to be out ahead of your customers' demands, especially in North America, is sustainability and emissions.
00:15:20
Speaker
You know the understanding in the customer base around emissions is very uneven right now. So California is implementing new regulations that are going in within the next two years and you know the dates sometimes shift on these things.
00:15:37
Speaker
Some things are saying as early as next year, some are saying as late as 2026, but emissions reporting is going to be a real thing and it's going to be required in California. It is absolutely required in Europe. It is theoretically going to be required by the SEC for all publicly traded companies.
00:15:54
Speaker
I posted this on LinkedIn the other day, but I had an executive at a company who was a multi-hundred million dollar company say to me that this wasn't relevant to them yet because they're not a billion dollar company and that's the California standard as people understand it today. I said, but are your customers billion dollar companies? Are you selling into Amazon? Are you selling into Target? Are you selling, are you a tier two manufacturer for Ford?
00:16:24
Speaker
this is going to have a cascading effect and that's really all on the left side of the compliance side of the house. Whereas do you want to talk for a second about the difference between our thinking about compliance and brand when it comes to this? Absolutely. So when we talk about just the compliance like Brian just mentioned, it's there. It's already there. I think when we think about compliance, oftentimes when I was previously a shipper, we just wanted to know that it was already taken care of.
00:16:53
Speaker
It's one of those things similar to where Brian said, you know, we would hear the word API and just be like, okay, you must be great at this. That feeling and understanding that it will be taken care of if we were to use that LSP is foundationally something that I think is just a good thing. On the other side of house, there are other brands out there.
00:17:13
Speaker
And I can speak from experience here, having come from the Lego group where there was an inherent heartfelt desire to actually be a sustainable brand. And that is both because they truly cared about the environment, but also because they wanted to get ahead of all of this compliance. Yes, we would always comply with things, but we wanted to do even more with that. And I think knowing the difference in your customer base.
00:17:40
Speaker
This goes back to that original slide where we segmented into three. There's going to be some that are just wanting to grow as a company and they want to make sure that compliance is there. Then there's others that are either larger brands or maybe specific to a generation that their product is for, and they want to show that they are ahead of the curve in the sustainability area. Having the ability to do that and at least report on it, I think, is the start of
00:18:09
Speaker
where we think LSPs would really benefit. And putting some specifics around that and things that we're doing with our customers today, you know, we have customers on the compliance side forwarders who are hearing different things from shippers. And this is clearly not shaken out in the market as far as best practices. And we're actually in the middle of a, we're going to publish a report on this. We're doing a lot of information gathering right now between
00:18:34
Speaker
Shippers who want very accurate transportation data, much, much more granular than they've ever had it before. So that even if you're doing a door to door move for them, they want transit legs and, you know, exactly where it's picked up and what mode was used and did you put it on the rail? Did you not put it on the rail so that they can do their own CO2 calculations? There are others, and this has no correlation to company size and the conversation we've had who are saying, I want you to tell me the emissions reporting.
00:19:02
Speaker
on my shipments, just tell me the CO2 numbers, right? And you need to be prepared to have that compliance conversation and A, have a strong position as a company to what you think, but also be prepared for some of the customers are going to say, I want your data. And some are going to say, I want you to calculate the answer and hand me. And you really have to be there for both of those scenarios.
00:19:27
Speaker
If I have two conversations at this point, I'm pretty much betting that they're going to be 50-50 between those two approaches. But in either case, if you're not doing the operational groundwork to make sure that you are underlying transit-like data, which often has been a little spotty because it's not a compliance issue, you don't really, you know,
00:19:48
Speaker
For those of you who use a large TMS, sometimes what you have exactly in the leg information doesn't really matter. As long as the billing moves, that matters now. The thing to get ahead of is data quality because those companies are going to start putting this into an audit regime. It's going to be similar to customs compliance where you're going to have to show your work and you're going to have to expect everyone as if the customer is sitting over your shoulder 24 hours a day.
00:20:17
Speaker
On the brand side, it's very different story. And this is a softer thing, but the ones who are looking for the brand recognition, if you can help them tell a story, you help them relocate a facility to reduce the mileage for their deliveries, you help them with a mode shifting challenge that, you know, a save the money, but also moved air to ocean for, you know, X amount of carbon.
00:20:45
Speaker
Helping them to build that narrative will get them executive recognition within their companies that they're contributing to that brand story. All the data in the world is one thing. Being able to use your technology to craft a narrative for them will make your sponsor into a rock star at their company. You bring that to a company who's only taking more compliance perspective, they're just going to say, why are you wasting my time? Again, know your customer.
00:21:10
Speaker
Yeah, it's a perfect example also where it borders on that going from the tactical to strategic. Just like you said, Brian, if those that are more motivated from a brand perspective can start choosing mode because they're ahead of the curve, they have their forecasting right and they can put it on the ocean versus air in order to have less CO2 emissions, they're going to do it.
00:21:33
Speaker
It's just what's going to happen and the ability to see that and understand it and then have the data when it is on the ocean to make sure it's going to be there on time is golden. So we have a audience question for forwarders and LSPs. How do you persuade SMBs to start with their sustainability? Currently from what I see, there are companies that are really ahead of the game and those that haven't started at all. How do you show the ROI from implementing sustainable logistics solutions and quantify the relevant value?
00:22:04
Speaker
I'll take a first pass at this, Rose, and jump in if you like. I think there's a couple of things. One, you can't force the issue if they really don't care, but you can start to educate.
00:22:18
Speaker
you know, coming from someone who started a software company doing, you know, kind of this multi integration thing in 2016, before most people kind of understood it. It had to be very patient with educating why this was a problem, explaining that their customers are going to ask for it and not necessarily asking them to sign something today or buy something from you today. So, you know, starting to just interject, Hey, this is how we're thinking about sustainability as a forwarder.
00:22:47
Speaker
in a low pressure environment will turn into a good conversation next year. The other, and this has always to me been the key with sustainability. The number one thing that every company can do to lower their emissions is mode shifting, air to ocean, like nothing even comes close to not moving air freight. And that saves money too. So almost anything you do in sustainability also has a cost benefit. And so sometimes it's just about kind of getting back saying, okay,
00:23:17
Speaker
We think sustainability is important. We want to help you be more sustainable, but we want
Sustainability and Cost-Saving Benefits
00:23:22
Speaker
you to go to your boss and say, hey, if we do this PO management thing with you, we think we can take 500 air shipments that you moved on an emergency basis out of your supply chain and move them to ocean, right? And then just tell them the ROI is the savings on the air freight, right? Not to mention more on time deliveries. Like this is my favorite part about sustainability is that it actually has an ROI.
00:23:46
Speaker
And nobody on this call, I think is in the position of trying to figure out the ROI of, you know, moving an entire container ship to methane or moving an entire container ship to hydrogen. We're trying to figure out biofuels for airplanes that had the pleasure of listening to some of those conversations. That's like, those are hard ROIs. From a freight forward or shipper relationship perspective, just make their supply chains more efficient and sustainability is the bonus. I have nothing out of that. I 100% agree.
00:24:15
Speaker
I wish it was the same with eating healthy. I could get the same bag of groceries. I just want cheap, healthy food. That's what we're selling. This is a bit of a grab bag of other things that we think you should be talking to your customers about and why they're hot. I think Rose and I can wander through these together.
00:24:38
Speaker
I'll start with the emissions reporting in ETS. Obviously we just had a whole slide on sustainability, but one of the things that everyone should educate themselves on is the new surcharges that are going to be coming in from the carriers on ETS, which is the carbon trading program in Europe. So the carriers have announced kind of relatively blanket surcharges. It's going to be this much per container. They're all trying to figure out what this means.
00:25:05
Speaker
your ability to help your customers interpret that and also to potentially guide them at the larger end of the scale in how to negotiate with the carriers on those topics.
00:25:18
Speaker
everything publicly says, oh, this will be blanket. It will be across the board. And I think any of us have done this for a long time. No, nothing's blanket and nothing's across the board. Once you get into that room at TPM with the carrier, especially when there's over capacity in the market. So being able to show those customers exactly what vessels and voyages they moved on and, you know, being able to have them go into their contract negotiations or your negotiations at NVO and
00:25:45
Speaker
have the data to have a strong in principle position with the carriers on, look, I know this is your blanket surcharge, but we are one of your most efficient customers. And the lanes we move on and the vessels you move on those lanes and therefore we're not accepting this is going to be an interesting, and I don't know where those conversations end, but I know if you're a good guide for your customer through them, they will appreciate that as a partner. Whereas you want to pick one?
00:26:13
Speaker
Yeah, I was going to pick PO management and visibility. I think with this one more and more, even as I worked in various places, not even dependent on size again, this is where this can sometimes be lacking for any customer manufacturer. And they really rely on the either logistics provider or 3PL to tell them what's happening with their own PO.
00:26:40
Speaker
I last worked at iRobot and there were still orders being sent via email. In that case, there's only visibility to the folks that are on the email. I think that these are the types of things where just moving that even to any ability to see is better than none. Having that capability, having it as an offering is a massive value add to those
00:27:07
Speaker
companies who may have fallen away from something they previously had or are really in need to see this, especially once something is moving. I'll jump in. I'm going to pick basic freight automation for a thousand Alex. So we have a customer who I'm not going to call out by name, but there are many, many, many billions of dollars in revenue kind of customer.
00:27:31
Speaker
We're doing a project with them right now where we're helping them implement ASNs into one of their facilities, which is a reminder that everybody has the basic problems still. There is almost no company on Earth. There are ones whose marketing would tell you otherwise, but when you get down into it, there are still, like Rose said,
00:27:54
Speaker
robot companies who are emailing POs and major manufacturers who don't know what's showing up at their facility today and are manually putting things away. Often it's not their mainline product or their core, it's stuff coming from ancillary suppliers where they've got a DDP program mixed in with the freight they manage or they've got something where you can go in and say, there's a very clear ROI.
00:28:21
Speaker
To us coming in and helping you automate bookings we have one of the largest exporters out of the US we just spent a year with them getting their spreadsheet into an automated process so they could get it over to their folders a little more effectively. It was the one spreadsheet for their tens and thousands of containers a year.
00:28:42
Speaker
So don't forget to go ask your customers about the basics and to poke in prod when you're seeing inefficiencies in their processes, because oftentimes you don't need to bring them blockchain or AI or an API. You just need to be like, why is this one person in this one facility emailing us four times a day? And can we help with that? And they will often say yes. And then you're a partner instead of a supplier. And I think
00:29:08
Speaker
That partnership is really key in supporting your customers' customers. This is where obviously the beauty of supply chain is that hopefully there's an endless customer until it gets into someone's home or otherwise. So this goes to those folks that are actual vendors that are manufacturing a component of something, making sure that
00:29:32
Speaker
there's an understanding of what their manufacturers are actually asking for and what they need all the way through to then that manufacturer servicing the retailer. And then of course the retailer servicing the end consumer. And in this, the needs are different. And just like Brian said, there's still a large need for that basic freight automation that we see in the industry as a whole. And it's usually something as simple as that, but just having the visibility in and asking or anticipating
AI in Supply Chains: Cautious but Valuable
00:30:01
Speaker
based on experience with other customers, is the right way to go about it and be that partner. We have another question. Let's jump over to that for a second. How do you see AI being implemented with sustainability? Any opinion or view, to what extent can AI be utilized for making supply chain decarbonization happen, specifically our perspective as a software provider? You got any thoughts on that one? Yeah, I think there's a number of ways. I think the first is doing some sort of
00:30:30
Speaker
Advancement in collecting the data that is existing and then allowing that to forecast future. I would say that's probably where my mind just goes to from a strategic standpoint. It kind of goes to what Brian was talking about in the larger scale of, you know, is a hydrogen container ship going to be in our future, right? And just understanding the inner workings from a mechanical standpoint, but then also from
00:30:59
Speaker
that data set that says, what has traveled across the ocean? Where can things be optimized and combined and things like that? Yeah. Look, I think we're in the middle of a hype cycle on AI. So I'm going to put a word of caution. I'm going to be the damn towel on this one a little bit. Every single person on this call is going to get a call from a vendor sometime in the next week or day or hour saying, I have an AI solution and then something.
00:31:27
Speaker
Right. And they're just going to assume that because they said AI, you're going to buy from them. I think AI and machine learning will certainly fall into the decarbonization world somewhere. I don't think it is the leader there. I think what you're going to see a lot of in Blue Yonder, who I'm not super familiar with, but I know they do a lot of marketing around sort of AI based processes in sales and operations planning.
00:31:56
Speaker
and getting the orders right and getting where you're not shipping things you don't need and where you're not shipping air and where you're not, again, being inefficient. I think that's a huge piece. The other is, you know, potentially filling in data that doesn't exist, but should. Right. And like one of the things that continues to amaze me is how, as I type on my phone now, or even voice dictate,
00:32:23
Speaker
It knows the next word or it sometimes it even knows the word I meant to say and on the voice dictation will type in what I meant, not what I said. And the ability to look at spotty supply chain data and use AI and things that look like chat GPT feeling things to
00:32:42
Speaker
fill in some of that missing data so that you can get a more continuous reporting view over what's going on and not be fighting with that spotty data. So there's just some ideas. But again, I think at the end of the day, the basics always win, right? And whether it's AI or blockchain or, you know, APIs or XML files 20 years ago, the technology has to be the second half of the sentence. And if there's one takeaway from any buzzword,
00:33:12
Speaker
If it's the first word out of the salesperson's mouth, don't buy the product. If it's the thing they're using and the first word is the business value, then you probably should evaluate that technology. So I was just going to add to that last one because I think even when we were thinking through the, how much space was being utilized on a truck, those are the things that machine learning AI and things like that can help with as well. But again, it's more of like.
00:33:39
Speaker
you don't necessarily need AI to look at a truck and say, okay, there's air here. You know what I mean? So I think that's also a take on it. Sometimes going back to just like common sense, human can be maybe at least a faster implementation than the AI. Trade compliance is our last one, Brian, you want to take that one? Sure. So on the trade compliance side, one of the things that is going on right now in the world is that we are in
00:34:04
Speaker
period of low stability in comparison to most of our careers. I would say if you were working in the last period of very low stability, you probably should be thinking about retiring because it was like a 30 to 40 year swing. So, you know, whether it's, you know, the recent events in the middle East, whether it's Ukraine, whether it's the, you know, decoupling of China in the U S whether it's forced labor targeting.
00:34:30
Speaker
These things are interrelated and they are increasing the burden on trade compliance professionals, right? So it's no longer just, let me get the tariff number right. And then if I have time, we'll go figure out about free trade agreements. And if we have time after that, we'll look at an FTZ. It's now, you know, am I going to be targeted for forced labor? Is my tier three supplier going to be targeted for forced labor?
00:34:57
Speaker
Are we moving product through a potential conflict zone that we never thought of as a conflict zone before? Do we have a software vendor who's headquartered in a conflict zone? And if so, do they have a continuity plan? All of these things become trade compliance concerns at a certain point.
00:35:17
Speaker
You know, and the stakes have never been higher because these trade compliance issues in 2023 versus 1993 when our brand become brand issues very quickly. So where you can help your customers, you know, target their shipments and their suppliers in the same way that the governments are going to, you know, so that they can be aware and act on things proactively. It's not just did I clear customs and did I pay the lowest possible duty rate, which
00:35:46
Speaker
for most of my career was the only two things that anyone ever asked me about trade compliance. You know, it is now, are we putting our company at risk and are we paying the lowest duty rate and did you clear customs? So we don't get to skip those things, but I think anyone who's doing anything with minerals, batteries, apparel, those things in particular, there are just huge amounts of issues
00:36:11
Speaker
I was talking to somebody this morning about dry bulk market and wheat and how that affects Ukraine. I'm not qualified to talk about those things, but it's almost any commodity and asking your customers what they're concerned about. Again, this is where a lot of AI can be helpful, is mining through those large amounts of data to find that needle in the haystack. I'd add to this and just say also, especially for those that may have been around since 1993,
00:36:37
Speaker
There is sort of a sort of nice to have maybe slight expectation that sort of the OGs in the industry have an opinion on this, especially as we see manufacturing move to other countries outside of APAC directly, some moving back to the United States even, and the differences there and some of the pluses and minuses that someone might not be able to see when they're just doing their cost analysis on something that's also helpful.
00:37:04
Speaker
Yeah, one thing that just popped into my head to kind of put a little fear into your customers sometimes about trade compliance is they'll say, okay, I'm shifting my production back to the US. They say, okay, but are you doing that by using a supplier in the US who may be sourcing materials overseas? And all you've done now is really shifted yourself to feel much more like a DDP program.
00:37:27
Speaker
where you no longer have visibility to the things you had before. And, you know, is that supplier now moving raw materials on a ship that maybe is, you know, being targeted for, you know, like things that we don't even think about and supply chain every day, but like, you know, issues of ships that are being diverted to Russia or issues of labor practices on the vessels if they're not using a large carrier.
00:37:51
Speaker
you know are they clearing customs properly and do they have compliance issues or are they about to be targeted because you shifted your manufacturing but you've also shifted the responsibility. Onto a local provider for something that you had much more visibility on before because of the raw materials whether it's a seed or mineral. Did not come out of the ground in the united states somebody's importing something somewhere and so you don't get a pass just because you're buying from the u.s. supplier.
00:38:20
Speaker
There's a couple more minutes if you want to add any questions into the Q&A, but I just wanted to kind of get your closing thoughts. Brian, I'll start with you. Rose will go next. What is your one piece of advice for LSPs looking to align their strategies with shippers for 2024? What would you recommend? I think it's really to put our minds back into the pre-COVID world where we have to show creative value that has a real ROI and a real business value other than
00:38:49
Speaker
the rate and other than the fact that I can just get your container there and getting back into this, we're going to help you be a better company. And that's why you should stay with us for many years.
Creative Value and Long-Term Partnerships for LSPs
00:38:59
Speaker
Awesome. Yeah, I'm going to directly piggyback off that and just say it's all about the value and being the partner, whether it's a small company or a large company, anticipating their needs, which are going to be different and truly showing up with that value.
00:39:14
Speaker
Perfect. Well, I don't see any other questions in the chat. Thank you all for participating, for being here for this discussion. We're going to send out some follow ups after this. We'll send out the slides and a recording as well. But thank you, Brian. Thank you, Rose, for your time and thanks for being here. Thank you. Thanks, everyone. Well, thanks to Rose for taking us through all of that. As you can tell, she and I have worked together for a very long time and she's a person I have great respect for in this industry.
00:39:42
Speaker
I hope you enjoyed the episode and make sure to check out Chain.io on LinkedIn and on our blog for more informative content through the end of the year on this topic and a whole bunch of others. Thank you.