Digital technology & innovation in Breakbulk

Technology and project logistics go hand in hand.

But how will the industry have to innovate across a new decade?

Digitisation is amongst the key drivers of industry change amongst carriers and freight forwarders, potentially leading to major cost savings and operation streamlining.

Breakbulk Europe will be examining the case for digital tech in project cargo in more detail during the 2020 event, but here’s an overview of the current situation facing carriers globally.

Digital technology in project cargo

A need to go digital?

Despite breakbulk’s global importance, and the fact it is huge business, its core operations have not evolved much from the fifties and sixties.

Freight forwarders, in particular, are beholden to what seem like outdated process and lengthy paper trails to complete shipments. Fax is still a widely used tool – something not a little shocking in an era of email, blockchain and other online solutions.

Covering everything from bill lading to track and trace operations, paper-based activities continue to dominate.

Digital technologies, including software solutions like blockchain, have enormous potential to bring these operational practices into the 21st century.

UN estimates say that, through embracing digital solutions, the cost and time savings are huge. Up to 44% could be shaved off transit times, and a further 31% slashed from operating costs through their utilisation.

Certainly, logistics firms themselves are already aware of the benefits technology can bring. A 2017 report by London-based research unit Transport Intelligence, “Global Freight Forwarding 2017 Report”, had 58% of survey respondents consider online freight marketplaces a potential major opportunity for traditional forwarders.

Going back even further to 2012, an Economist survey of senior logistics professionals saw 86% say they believed technology as the number one way to avoid dropping margins in the future.

What digital project cargo solutions are available?

The industry is “awash” with solutions, in the words of Abir Thakurta, Vice President of global supply chain at Atlanta, USA-based Havertys.

The Internet of Things (IoT), cloud technology, automation and robotic solutions, and blockchain all offer a suite of options to carriers and project logistics firms looking to update their current processes. AI, machine learning, and data science all play their role too.

Blockchain, in particular, has been eyeballed as a potential game changer for project players, presenting as it does one contact point for all stakeholders. 

Take large-scale construction or EPC projects. The budgets for these regularly exceed $1bn, with multiple stakeholders, touchpoints, and activities, corresponding to linkages, freight deadlines, payment deadlines, and so on. 

Blockchain-enabled smart contracting can consolidate all the above into a single, accessible online ledger, accessible by all the main project participants. 

As well as certifying events like delivery deadlines, vessel chartering payment dues, etc., it can also create alerts on aspects of project completion like cargo being overweight or over-dimension against original specs, or dead freight charges.

The ultimate idea is transparency and avoiding what can become a lengthy game of “Chinese whispers” that can sometimes occur in megaprojects.

If we look at data analysis, we can see some solutions already in the prototype or development phase aimed at cutting costs, and even emissions. 

One of the solutions making waves comes from Dutch start-up We4Sea.

The platform creates a “digital twin” of vessels, in order to track speed and location data, as well as information on ships’ various components. Fuel usage and emissions are thusly tracked in real time. Using this data, fleet operators can work on improving their fuel and energy performance throughout the year.
The end results? Lower harmful CO2 emissions and possible major cost savings.

IMO 2020 regulations come into force this year, prompting carriers and fleet operators to think hard about fuel efficiencies. It’s predicted to cost around $1m a year more to run vessels when new lower sulphur fuels become the new standard from 2020 onwards.

Big data also opens the door on predictive planning via Working alongside AI to spot patterns in deliveries and cargo transit. 

With cloud-based technologies storing important documentation, easily downloadable and shareable, the actual, physical paper trail can be reduced dramatically too. 

Is a holistic approach to breakbulk digitalisation necessary?

While breakbulk firms may be aware of the variety of technological options at their disposal, it’s important not to get lost in a world of digital noise.
There is a world of solutions out there, but many often work in tandem to create a full suite of technologies that will improve both time and monetary outlay for all parties.

Supply chains themselves are formed of a carefully interwoven series of processes. Such complexities are often better served with a carefully planned out approach, much like how, say, a road transporter will do careful route analysis before moving any cargo. The same thinking should be applied to adopting digitisation in project freight operations.

The major project players already adopting digital tech

G2 Ocean and Manuchar have successfully proved paper Bills of Lading are a potential thing of the past.
The pair concluded tests of CargoX Smart B/L™ blockchain technology to transfer Bills of Lading digtally with partner shippers around the world. During its test period, the companies moved goods ownership for cargo loads travelling from China to Peru.

“G2 Ocean consider Smart Contracts based on Distributed Ledgers or blockchain as a unique opportunity to digitalize and automate manual processes between its clients and subcontractors. The Bill of Lading is one of two priority areas in 2019 using blockchain technology. Based on these successful pilots, our next step will be to scale this up and offer it’s as a value-added service to our clients,” said Leif Arne Strømmen, Vice President of Innovation G2 Ocean.

“The implementation of new technologies is essential to establish and maintain our leading position in terms of cost-efficient sourcing & supply chain solutions for our customers. We focus on technologies that go beyond the hype and deliver real benefits in terms of speed, efficiency and the quality of service.

“That is exactly why this successful Smart B/L pilot is such an important next step in Manuchar’s digital transformation program: it provides real value. We thank G2 Ocean and CargoX for the excellent collaboration in achieving this success”, states Bart Troubleyn, COO of Manuchar, said in a press release.

A joint venture between Hapag-Lloyd, CMA CGM, COSCO Shipping Lines, Hutchinson Ports, OOCL, Port of Qingdao, PSA International and Shanghai International Port, and technology supplier CargoSmart, has been established.

The non-profit Global Shipping Business Network (GSBN) was established in July 2019 as a way to further digitisation in the project cargo sector. Its ultimate goal is to all shipping supply chain participants to collaborate and accelearate further innovation in the development of trusted, secure data exchange platforms.

Signatories believe GSBN will ultimately unlock more underlying value, openness, and further opportunities in worldwide project shipping.

Rajesh Krishnamurthy,Executive Vice President – IT & Transformations, CMA CGM Group, said: “In line with our Customer Centric and Digital First approach, the CMA CGM Group is committed to facilitate increased transparency and to spur innovation with the entire supply chain ecosystem. The GSBN blockchain consortium provides us a concrete opportunity to bring greater value for our customers and the supply chain as a whole.”

“We are focused on offering our customers the best choices for their supply chain needs. Once it is established, the GSBN will work, with its JV structure and strong carrier and terminal participation, to increase efficiency in cross-network operation for the benefit of the various stakeholders in our industry”, says Martin Gnass, Managing Director IT Technology at Hapag-Lloyd.

Dive into a world of new technology at Breakbulk Europe

Whether you are presenting new digital tech for the project cargo industry, or looking for tech suppliers, Breakbulk Europe is the place to be.

As an exhibitor, you will meet face-to-face with project owners, EPCs, industrial manufacturers and global project forwarders—the people who are actively searching to streamline their processes and embrace a new digital era for breakbulk, heavy-lift and project freight.
Share your services and your expertise directly with buyers in a venue designed for making the connections you need for new business.  

Become a Breakbulk Europe exhibitor today.