Portrix tie-up advances Xeneta’s forwarding software integration

Portrix tie-up advances Xeneta’s forwarding software integration

Customers of both Portrix and Xeneta will be able to pull Xeneta’s crowd-sourced contract rate data directly into Portrix workflows. Photo credit: Shutterstock.com.

Oslo-based contract ocean freight rate benchmarking and analytics platform Xeneta is continuing its integration of data with widely used forwarding software by tying up with Hamburg-based logistics solutions provider Portrix.  

Portrix provides freight rate and contract management software to many of the world’s largest forwarders. Customers of both Portrix and Xeneta will be able to pull Xeneta’s crowd-sourced contract rate data directly into Portrix workflows.

It’s similar to an integration Xeneta developed in June with Catapult International, another freight rate management software provider. At the time, Xeneta executives said they had planned to create other collaborations.

Company officials told JOC.com that the partnerships are part of Xeneta’s view that its data is part of a larger connected ecosystem of data providers and execution tools.

For Portrix, the Xeneta data is particularly useful in two specific applications, CEO Henning Voss told JOC.com.

The first is when larger forwarders take bookings from shipper customers four or more weeks ahead of a sailing, and then need to decide the optimal time to execute that booking with the carrier. In other words, a forwarder doesn’t necessarily book space on the vessel the moment it accepts a booking request from a shipper. It waits to see whether the price for the slot on the vessel will go up or down over the three weeks between the shipper booking and the actual sailing.

The idea is that the Xeneta data would be layered upon internal data and trade lane expertise to make those decisions.

“They have departments that look at when the right moment to book is,” he said. “And in that scenario, you can’t have enough information. Xeneta provides five different levels of their index. Looking into the trend of that data, someone who has knowledge of that trade, they can read into that data and determine where they should book. Forwarders are working with slim margins on the main leg, so any additional margin you can get means a lot.”

The data helps the trade lane manager understand if the price is going up, and which carrier is first and last price mover, and then they can weigh those decisions against the minimum quantity commitments (MQCs) and allocations with contracted carriers.

MSR confidence building

The other use case, Voss said, is where the Xeneta data might help a forwarder lacking data in a certain lane to build enough confidence to set a minimum sell rate (MSR).

“Those lanes where your data isn’t good enough to build that MSR, any additional that helps you develop that helps. You’re probably not looking at the low [index rate] but the mid or high one, that’s going to help you understand how to get a margin. It’s not that we’re just relaying the data, but we’re weaving it into the result of what they get so they can make informed decisions.”

Anastassia Wojtek, director of product at Xeneta, said the ability for users to ingrain the data in decision making makes it a key differentiator relative to other indexes.

“The perception in the world of freight forwarders is, with Xeneta data, I have another reference point,” she said. “What we try to do is actually look at ‘how do I build my decision-making process?’ I give my trade lane manager an additional piece of info. You can kind of make your assumptions in a structured way. ‘Which markets do we want to target? Which carriers do we want to use? Should we do tactical adjustments in the carrier portfolio?’”

Voss said the decision to integrate Xeneta data was borne somewhat out of the reality that forwarder value propositions are changing.

“New players are coming up,” he said. “Some of what forwarders serve will be served by carriers. If you look at what freight forwarders have quoted over the last decade, they mainly quoted where they physically were in the world. That will change. There will be forwarders who don’t have offices everywhere in the world.”

In that environment, he said, the key is to find what he called “the sweet spot of pricing,” where the forwarder has a margin, but the customer accepts the quote. “To get that sweet spot, you need market data. Xeneta collects that data and references the data.”

Contact Eric Johnson at eric.johnson@ihsmarkit.com and follow him on Twitter: @LogTechEric.

Comments

Steps in the right direction in trying to be more efficient, clear some of the clouds.