The logistics space is historically complicated, fragmented and laborious.
It is also critical to facilitating global trade and foundational to international business.
The paradox of old, new, and necessary is why next generation digital marketplaces and B2B platforms are increasingly capitalizing on the white space opportunity that exists to modernize legacy operations.
“From day one of this world and until I assume its end, people will need to move goods from point A to point B,” said Raz Ronen, CEO and co-founder at FreighTech software-as-a-service (SaaS) startup Wisor.AI in a recent discussion with PYMNTS.
Ronen said that over the last three to five years he’s seen the logistics business go more and more digital, with shipping companies moving from Excel spreadsheets to online platforms and cargo companies providing API integrations, spot rates, and next generation features like dynamic pricing.
The only part of the logistics sector that really seemed stuck in its ways, he said, were freight forwarders.
“There’s legacy businesses, family businesses, old traditional companies that have now reached a point in the last two years where they understand that if they don’t take the next step, they will have troubles, they might even close, because they now need technology to provide the right level of service that their customers are looking for,” he said.
That’s why, fresh off of an $8 million seed round, Ronen’s advanced freight booking solution is on a mission to digitize the freight industry, lower costs, and reduce inefficiencies.
“What we see today as the main challenge for freight forwarders is to know and have the ability to answer their customers’ … simple questions, like how much things cost, when they pick the goods up, when goods will be at the door or at a factory; but these questions are really enormously complicated,” Ronen said. “We are working in an industry that has between a 10% to 50% conversation rate between request to actual shipment.”
The reason, he added, is that no business customer wants to wait three days for a quote, agree to the quote, then find out the price is not valid anymore for whatever reason and have to start the process all over again.
“People are looking and expecting to get answered immediately, to say yes, please book, I want to pay now, and I want to see where my shipment is along the process,” Ronen said. “Just like how consumers can with DHL, or Ali Express, there’s a new expectation [around the level of service].”
The changing B2B landscape and evolving expectations of enterprise customers means that freight forwarders are fighting both to keep their existing customers, as well as to win new ones, Ronen said.
“Since I began to work in this industry,” he said, “things have rapidly evolved. Five years ago, no one wanted to pick up your call or answer your email, now people are asking what is AI [artificial intelligence], how can it help, what is an API [application programming interface]?
“And what Wisor is doing is unique, we can organically integrate into the day-to-day processes in just five days, we are not changing anything or replacing any platform, just empowering and supporting [freight forwarders] with AI and NLP [natural language processing] models to read emails and understand what’s cheaper, what customers want, and generate quotes and push them back in seconds instead of days.”
He emphasized that now businesses have “hundreds and hundreds” of digital platforms. “You cannot really stay up to date and manage so many different UX [user experiences] and UIs [user interfaces] … collect all the information and compare every time all the different options and opportunities. They need someone to aggregate it and be the bridge, and that’s what we’re doing — we see ourselves as the adapter for our customers to digital.”
The end goal, Ronen said, is to automate the process end-to-end. “But it’s step by step, trust is an important key in this industry. It is and will always be a physical and complicated process to move goods, but it will steadily grow more digital, more efficient, and companies will have better abilities.”
Sometimes small things can make a big difference, he added.
We’re always on the lookout for opportunities to partner with innovators and disruptors.
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