Alibaba goes to sea

Chinese e-commerce giant Alibaba entered a partnership with Maersk, the world’s largest ocean container shipping line, allowing shippers to use Alibaba’s OneTouch website to book space on Maersk vessels.

OneTouch, which Alibaba acquired in 2010, targets small- and medium-sized Chinese exporters and allows them to book shipments with air freight and parcel delivery services. And now, with Maersk, as well. The service launched in late December, offering advance booking of space with Maersk on selected routes from eight Chinese ports, with a pre-paid deposit to lock in rates.

Last year, Amazon also entered the ocean freight business when it gained certification in China as a non-vessel operating common carrier (NVOCC). With Alibaba now allowing shippers to book directly with Maersk, and Amazon now a forwarder in its own right, it is no longer reasonable to dismiss out of hand the thought that traditional forwarders face an existential threat.

That is not to say that Expeditors and Schenker and K+N and the other giants of the industry are in any trouble. At least not today. The forwarders that should be worried today are the hundreds of small outfits that serve the thousands of small- and medium-sized shippers in China that want to move their products to North America and Europe. But to say something like “Well, sure, those little guys are going to suffer, but we’ll be okay” is to make a serious mistake.

Listen to Maersk CEO Soren Skou, recently quoted in The Loadstar on the way the business will change as Maersk pursues its goal of increased digitization: “The customer experience is likely to change: it’s going to be online; it’s going to be self-service; it’s going to be a lot less person-to-person; a lot fewer emails; and a lot fewer phone calls.”

And, regarding forwarding, he added: “It’s going be more cost-effective for us because the customer will be doing a lot of the work for themselves, and it’s going to affect the demarcation lines between what has traditionally been a freight forwarder and what has traditionally been a carrier.”