Dive Brief:
- Kuehne + Nagel (K+N), the Swiss 3PL, has signed a memorandum of understanding (MOU) with Alibaba.com, American Shipper reported. The MOU makes available K + N's logistics network to all of Alibaba's China-based shippers, instead of only paid members, as had been done previously.
- K + N's KN FreightNet offers users quotes, pickup, and delivery booking services for consignments that ship by air through Alibaba.com, including less-than-container-load (LCL) bookings.
- Ultimately, the pair intend to offer sea, rail and overland logistics services as well.
Dive Insight:
K+N and Maersk are both dipping their toes in international freight forwarding waters through ties to Alibaba, China's vast sales platform. Instead of moving from smaller to larger markets, the pair may move to invert this strategy, beginning with a large market with the intent to then narrow their focus to offer the same service to smaller companies.
Within the U.S., the role of freight forwarders is evolving, and digitalization is becoming the order of the day. Yet not every small and medium-size shipper demands it, and in fact may prefer a personal relationship with a forwarder to an online quote. In the U.S. alone, at least 97% of importers employ under 500 staff while managing approximately one-third of the nation's global imports.
Smaller companies may be an untapped market for freight forwarders. Rather than pursuing only the large players such as Alibaba and its countless shippers, smaller, individual companies can provide diversification and greater business stability.
