On the journey from paper shipping documents to digitized data, new software is emerging that can sift through multiple formats, offering an accelerant to adoption by shippers and forwarders.
The challenge is that shipping documents have, and likely always will, come in multiple formats, and that makes it a data normalization challenge. Technology is, of course, an answer, but it’s a two-part challenge.
“Image recognition of documents is a solved problem,” said Jenna Brown, CEO and co-founder of London-based Shipamax, a startup focusing on automating data entry related to shipping documentation. “The problem is not extracting the entities within a document, it’s understanding what they mean and how they’re related to each other.”
Until recently Shipamax had been focused entirely on the bulk shipping market, but it has in recent months expanded to target freight forwarders with its data extraction software.
“We turn supply chain documents into machine-readable data,” Brown said.
Data can be sent via application programming interface (API), but typically Shipamax plugs into a customer’s email. As relevant information comes in via email or email attachment, the software extracts the core information, structures it, and can push it directly into an internal enterprise resource planning (ERP) system.
The value is a reduction in the number of hours spent manually entering data, a problem Brown said that forwarders of all sizes tend to struggle with. Shipamax is currently focused on midsize forwarders — those with 50 to 250 employees — but she believes the solution is also eventually relevant for larger freight forwarders, shippers, and trade finance banks.
What forwarders want
Brown said that forwarders want data in a globally recognized standard, but there really isn’t one beyond electronic data interchange (EDI). So Shipamax’s software essentially aims to create a standard across the different formats in which data might arrive — EDI, an email, an email attachment, or something else.
“We process the data and put it in a standard without human administration,” she said. “A huge part of operations is keying in data — what shipment does this belong to, where does this entity go. The traditional solutions are EDI-based, but that doesn’t fix it, because there are all these emails. So you have these bespoke systems integrations with every supplier, but you’re also never going to be rid of email.”
Blockchain is another potential solution for the problem of data contextualization, but Brown said it, like EDI, relies on industry participants to plug in with one another via specific systems-to-systems they aren’t using today.
“In terms of EDI and blockchain, the problem here is you need one-to-one integrations with everyone before it starts to really reduce the admin workload,” she said. “Email is fundamentally quite a good communication infrastructure, and everyone already uses it. We're leveraging that by just sitting on top of it. If you do get data via other means, you can just push the unstructured data via an API call.”
Brown said, “95 percent of the time this process is done manually” by forwarders.
Shipamax’s evolution as a company is emblematic of many startups in the shipping and logistics space. The company started in 2016 as a digital bulk shipping brokerage, aiming to automate most of the processes between cargo owner and vessel operator. But seeing that the product wasn’t getting traction, Brown and co-founder Fabian Blaicher pivoted in 2017 to become a software-as-a-service (SaaS) provider for the bulk shipping industry.
More recently, Shipamax started understanding where those data extraction and contextualization solutions had applicability in the container market.
“We were taking stock of where we had done well in sales [as a digital broker],” Brown said. “And underneath the product for bulk shipping, there’s this data processing lake. Bulk shippers get 3,000 to 10,000 emails with ship data, and our core software extracts that data. We started to see the parallels with freight forwarders and container shipping and saw that our product could be tweaked a tiny bit to serve that market.”
The value of the software to forwarding customers, Brown said, is that freight forwarders can process submitted customs documents faster and provide shippers with faster and more accurate pricing estimates.
Shipamax has raised $2.5 million in venture capital funding, primarily through a seed round in May 2017. Brown and Blaicher also were part of the initial set of entrepreneurs to participate in the Dynamo accelerator program, a Chattanooga, Tennessee-based program for supply chain and logistics startups.