In this article, Hio Sola – Usidame (Founder of OnePort 365) talks to Business Insider Africa about how technology is simplifying freight forwarding in Africa.
Africa contributes an increasingly significant amount to global maritime trade, with a reported 12 per cent of the 811 million containers handled at ports worldwide. Africa’s clearing and forwarding markets are also growing, with the latest figures suggesting a market size of $4.2 billion and a projected 12.5 per cent growth with new services emerging.
However, a number of challenges still plague African cross-border traders, some of which include booking, payment, documentation and visibility. These effects include increased costs, inefficiencies and many missed opportunities for traders. For many African traders, the traditional paper-based approach to managing freights is the norm. Despite its faults and shortcomings, they tend to choose it since it is what they are familiar with and used to. We also have to remember that these traders are moving hundreds of thousands of dollars worth of goods at a time so sticking to what they know best often seems like the safest option.
However, these processes have been digitised in other parts of the world, and this should be the same in Africa. Many digital freight forwarding companies use technology to facilitate the movement of goods by simplifying payments and paperwork as well as providing real-time visibility.
There is no reason why managing cargo should not be as easy as booking a flight or using a ride-hailing service. And just as technology has played a significant role in transforming the air travel and ride-hailing industries, we believe that it can also play a role in transforming Africa’s freight management industry.
Here are some of the ways technology can transform freight forwarding in Africa
Centralising the Booking Process
Managing the movement of cargo can involve many different parties, and staying on top of everything can be a complex process, especially with the paper-based approach. By leveraging digital solutions, traders can connect with as many vendors as they need and manage the entire booking process on one platform. Traders no longer have to wait up to two weeks to compare the best rates from different service providers. With pre-negotiated rates, they can explore competitive offers and book freights in 30 seconds or less.
Simplifying the Payment Process
Digital platforms leverage the advent of technologically-enhanced infrastructure, the Pan-African Payment and Settlement System (PAPSS), for instant payment transactions across Africa. This is a major game-changer for African traders, meaning traders only need to engage with one channel, saving them both time and money on their transactions while having access to instant payout.
Digital platforms also make it easier to pay in various currencies, which can help mitigate forex challenges that impact various countries. For example, traders can now pay in Naira on the OnePort 365 platform, with their customers receiving payments in the relevant currency on their side. This makes it easier for them to complete transactions without being unduly impacted by Nigeria’s current restrictions on forex.
The COVID-19 pandemic was a catalyst for our business as traders needed to explore other options for managing their freights and cargo that didn’t require their physical presence. By adopting digital solutions, traders can seamlessly exchange both pre-shipment, as well as post-shipment documents. Traders can log securely onto web platforms to view all the documents attached to their shipments. This eliminates the laborious process of physically retrieving these documents from offices or shipping line centres.
Before the advent of digital freight forwarding companies, traders could only track their goods in transit by having a man on the truck. This was often their best option to avoid their cargo mysteriously disappearing. However, digital solutions such as trackers that allow monitoring of shipments across every inland point enable detailed reporting on the whereabouts of cargo in real time. These tracking devices also reduce the risk of revenue loss by reducing the risk of cargo theft or loss.
Hio-Sola Usidame is founder of OnePort 365, the start-up digitising freight management and making the process of moving cargo efficiently and conveniently to, from, and within Africa.
