What is Customs Software?

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Customs Software is a program or a website that enable its users to manage their customs process. While you can work with a broker to create and submit your declarations, you can also do these by yourself with customs software.

As you know, with the UK leaving the EU and starting the Brexit process, the need for import-export software has escalated due to the new regulations and declarations.

While it can change from one to another, basically, you can submit import-export declarations, safety and security declarations[exit summary declaration (EXS) and entry summary declaration (ENS)], transit declarations and all the other customs procedures through customs software without the need for additional programmes or software.

What is Customs Declaration Service Software?

Customs Declaration Service (CDS) software, provides companies in the logistics industry with a platform to create all the mandatory declarations and documents and also enables users to submit the declarations to CDS. Running every operation you need on one single platform saves you time by combining the necessary elements which are obligated for the productivity of the business. This will facilitate the workload caused by the redundant document mass.

While some of the customs software only offers customs modules, some help you to cover every operation you will need to run your business. These are usually called Freight Management Software or simply Logistics Software. For example with Modaltrans, besides creating customs declarations, you can manage different departments such as HR, accounting, and warehouse from one single page via any smart device with an internet connection.

What does the Customs Declaration Service do?

The Customs Declaration Service (CDS) is a customs declaration platform used in Northern Ireland and Great Britain trade since August 2018.

It will be a replacement for the currently used system, CHIEF (Customs Handling of Import and Export Freight).

There will be few changes between CHIEF and CDS. The codes that were used in CHIEF will be different in CDS. And you will need to add new or different data with the declaration you will submit.

These new import and export tariffs that are required by the Union Customs Code (UCC) can be done via CDS.

Also, if you use the payment methods which are given down below, you will be affected by the changes in declaration payments.

  • Flexible Accounting System (FAS) accounts
  • Immediate Payments
  • Guarantee Accounts
  • Individual Guarantees

For detailed information, you can view the other posts about Brexit and visit the Brexit page.

Customs Declaration Software Integration Benefits for Export and Import Business

One of the most troubling things, if you are dealing with customs, is the prices that are paid for the declarations. Paying superabundant numbers to brokers to get your vehicle through customs is redundant when there is an affordable solution for your import-export operations.

So other than paying less, what do these import and export software promise?

Creating your declarations and being able to follow every step of the process, gives a sense of independence. Considering the other companies that brokers work with, priority is not always you. You just need software to be your own broker. While it increases your speed, it also increases productivity. You will no longer wait for your turn, you will create and submit the declarations in less than 10 minutes. What makes it possible to submit customs declarations in a short amount of time is the capability of the software that stores the data in its structure. You may ask: “What does it mean?”

To keep it simple, you won’t have to write down every single piece of information such as the consignee, consignor, departure customs, carrier etc. over and over again. The only thing you should do is to put in the data that you will need through the customs process, for once. Let me tell you about the importance of storing the data.

For years (and still), logistics companies used Excel documents to keep their data which caused an excessive amount of documents and prints to pile up. It fills up the memory of the computers and unfortunately, it is archaic. Logistics is an industry that evolves exponentially, to keep up with the race, you have to follow innovations in logistics closely. Nevertheless, these old ways of doing business which forces you to manually enter information hinder your process. It is challenging, boring, and takes so much time. However, now it is avoidable.

Customs Declaration Software Solutions After Brexit

CHIEF (Customs Handling of Import and Export Freight) was a system of HMRC, which is a responsible department for basically collecting taxes, and it was used for managing the declarations and goods. The most important changes that came along with the Brexit process were the new system that took over the place of CHIEF and the new border control system.

CDS has already been used since 2018 for the trades between Northern Ireland and the UK. But since the Brexit transition period, it’s been implemented to take CHIEF’s place. With the new service and declarations, you need to work with a system that can keep pace with the evolving technology. Unlike the ERP or Standalone systems, cloud-based customs software is the best way to be always up to date with the newest adjustments. Cloud-based customs software are constantly updated according to the needs of businesses.

Lastly, let’s talk about GVMS. GVMS (The Goods Vehicle Movement Service) is the new UK government border control system. GVMS will link declaration references together, also link the movement of goods declarations and notify customers about their goods HMRC status. It is one of the most useful features that came with Brexit, for that reason Modaltrans has completed the integration of HMRC as a priority.

As Modaltrans we are continually following new developments to provide you with a better experience. All the integrations that you will need for customs are completed already, and for the other operations you will need in the future, we are always ready. Work with the right partner that offers tailor-made export and import solutions for your unique needs.

What are CSPs?

Community System Providers (CSP) are community network services that provide port/airport electronic information exchange. They are directly linked to HMRC and other government agencies and connected to the CHIEF and CDS. There are a total of 5 CSPs located in ports and inland clearance locations that work with freight forwarders, shipping lines, haulage companies, customs brokers and other commercial logistics companies.

CNS whose system name is Compass alongside maritime container traffic also deals with air and courier. It is linked to seaport locations at Southampton, London, Gateway, Tilbury (part), Portsmouth, Belfast approximately 80 ETSFs. Apart from the Compass system, CNS has another system specifically for air transportation that is called CNS Air Courier.

Maritime Cargo Processing (MCP) also known as its systems’ name Destin8, mainly handles maritime container traffic and is linked to seaport operations at Felixstowe, Great, Yarmouth, Immingham, Hull, Teesport, Tyne, Blyth, Grangemouth, Aberdeen, Greenock, Liverpool, Cardiff(1), Bristol, Thamesport, London Container Terminal (Tilbury), Harwich, Ipswich plus approximately 70 ETSFs.

CCS-UK controls air cargo import and export at most of the UK airports.

DHL Aviation (UK) Ltd. is both the carrier and system user and only handles traffic for its customers in the air environment. It is located in East Midlands Airport /Heathrow/Manchester/London/Colney.

Descartes Ltd. has a system named Pentant that includes three systems. For air, they have an import frontier inventory system. For maritime they have an import and an export frontier inventory system. They are linked to Ro-Ro – Dover/ Air – London City Airport and Warton, Aerodrome/ Maritime/ a variety of smaller ports/wharfs/berths.

All the terms we mentioned above may seem to make the supply chain and logistics operation much more difficult than it used to be, but with a simple, easy-to-use interface, Modaltrans will take the burden off your shoulders. We are offering you every module you will need; customs, transport management, fleet management, accounting and finance management, CRM, warehouse management, HR. If you are interested, get in touch with us!

How to Get Your Business Ready for Brexit

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What has changed after Brexit?

In 2016, with the result of the referendum for leaving or remaining a member of the European Union, the Brexit transition period has begun. New regulations for transportation and customs came into force as of January 1. Even though the new systems and declarations for Brexit may seem complicated, with the right information and direction, you can adapt your business quickly to Brexit. The most significant change is transitioning from CHIEF (Customs Handling of Import and Export Freight), which has been running for 25 years, to CDS (Customs Declaration Service). The other important change is of course customs. While some procedures for customs declarations have changed, new declarations have been added. The Brexit pros and cons are not fully predictable, we will see the consequences of Brexit in the following times. We will try to explain some of the changes that you need to know while preparing for Brexit. Here you can see Brexit’s impact on businesses and the differences in logistics in the UK after the Brexit transition. Let’s get your business ready for Brexit!

What is Customs Declaration Service (CDS) ?

The Customs Declaration Service (CDS) is a customs declaration platform used in Northern Ireland and Great Britain trade since August 2018.

It will be a long-time replacement for the currently used system, CHIEF (Customs Handling of Import and Export Freight).

With CDS, you can:

  1. make customs declarations via software that is compatible with the Customs Declaration Service
  2. get import VAT statements and certificates to help complete your VAT Return
  3. get duty deferment statements

Most of the users find it easy to use but of course, because it is a new system, users can face some challenges.

How to Get Access to the Customs Declaration Service (CDS) ?

The first thing to do is getting an EORI number. For all customs declarations, you are required to have an EORI (Economic Operators Registration and Identification) number. If you export goods from England, Wales or Scotland you need an EORI number that starts with GB and if you export or import goods from Northern Ireland you need one that starts with XI. For those who are internationally trading, the EORI number enables your data to exchange internationally.

Once you have an EORI number, the next step is to get a Government Gateway user ID and password.

The first thing to do is getting an EORI number. For all customs declarations, you are required to have an EORI (Economic Operators Registration and Identification) number. If you export goods from England, Wales or Scotland you need an EORI number that starts with GB and if you export or import goods from Northern Ireland you need one that starts with XI. For those who are internationally trading, the EORI number enables your data to exchange internationally.

What Will Happen After You Apply?

After you applied, there are two ways that can happen:

  1. You can start straight away.
  2. If HMRC needs to make checks, you can get access in 5 working days.

You will receive a confirmation email if the process goes smoothly (also check the status of your application). After that only thing left to do is setting up your duty deferment account and completing a new Direct Debit Instruction.

What is New Computerized Transit System (NCTS) ?

You need to use the Customs Handling of Import and Export Freight (CHIEF) system to make import or export declarations, to use CHIEF, you’ll need to tell HMRC your full contact details so they can be linked to your CHIEF badge.

To get access to CHIEF you’ll need to both:

  • apply for access to CHIEF
  • buy commercial software that can submit declarations through CHIEF

If you’re a trader in Great Britain moving goods using transit…

First of all, you will need an EORI number that starts with GB. After that, you must register your business for VAT with HMRC if its VAT taxable turnover is more than £85,000 (the ‘threshold’).

There are several ways to ease the transportation and declaration process if you export regularly. One of them is the simplified declaration procedure. This process consists of two parts, in the first part you do not have to give much detailed information, and when it is accepted, you will have to submit a supplementary declaration within 14 days. And you will give all the additional and necessary information to the customs through this declaration.

The other one is using Common and Union Transit. You can move your goods quicker to EU countries and common transit countries without submitting customs declarations and duties at each border crossing and you can complete some customs processes away from the border.

If you are moving goods from the UK to European Union countries or common transit countries using transit, you need to complete a transit declaration on the NCTS. You can also move multiple goods together under one declaration in accordance with the type of goods.

You will also need to submit an export declaration before completing your transit declaration if the goods are both:

  • going to an office of destination anywhere outside of the United Kingdom
  • not under duty suspense when they start their transit journey in Great Britain

From 1 January 2021, all movements starting in Great Britain have T1 status.

Besides, all transit movements which require safety and security data will need to submit an exit summary declaration.

If you’re a trader in Northern Ireland moving goods using transit…

You will need an EORI number with XI and a guarantee reference number starting with XI registered to an XI EORI number.

If the goods you are exporting are made in the EU or Northern Ireland, or have EU or Northern Ireland duties paid on them, you will need to register for the National Export System.

You can make transit declarations through XML or the EDIFACT email channel.

How to use the EDIFACT email channel to access the NCTS

To use EDIFACT to access the NCTS, you will need to buy software that is compatible with NCTS.

Through gov.uk, you can check the technical issues and see if your current software is compatible with NCTS.

What is Goods Vehicle Movement Service (GVMS)?

The Goods Vehicle Movement Service (GVMS) is a UK government border control system. GVMS will link declaration references together, also link the movement of goods declarations and notify customers about their goods HMRC status. Under GVMS all customs declarations would need to be submitted and be quoted against the vehicles GVMS record.

You need a goods movement reference to move goods from:

  • the EU to Great Britain (England, Scotland and Wales – for transit movements only)
  • Great Britain to Northern Ireland

Goods Movement Records and References

At borders that operating a pre-lodgement model and using the GVMS to control goods, pre-lodged declaration references will need to be linked together within a single Goods Movement Record (GMR). Carriers will require hauliers to give them the reference generated by a GMR (the Goods Movement Reference or gmrId) for them to use when they arrived at the crossings on these routes.

What is required to obtain a valid GMR?

For goods in every vehicle making a crossing on a GVMS route, your software users need to get a reference number proving that declarations have either been pre-lodged or are not needed.

For detailed information about the references, you can visit the UK government website.

How to Register for GVMS?

To move goods over routes that use GVMS, responsible business or the person must have a registered account with HMRC.

First of all, your business needs a Government Gateway user ID and a password. Also, you need to link your Government Gateway user ID to your GB EORI number.

After that, you must register your business online for GMR service.

How to Create or Update a GMR

As a software user, you will need to update your GMR with all the information HMRC needs. The level of information can change in accordance with the goods you are moving and the customs procedure. You can create a full record or incomplete information and update it later. Nevertheless, if your record is not complete, finalisation will not be possible. It can be updated as many times as needed before being used at check-in.

What is Safety and Security Declaration?

There are two types of safety and security declarations: an exit summary declaration (EXS) and an entry summary declaration (ENS).

From 1 July 2021, you will also be required to submit safety and security import declarations on goods entering Great Britain from the EU.

What is Exit Summary Declaration?

Exit Summary Declaration is one of the Safety and Security Declarations.

An exit summary declaration is needed if you are moving goods outside the UK. From 1 January 2021, safety and security requirements will apply to all movements out of Great Britain unless the goods are coved under the temporary waiver or are going to Northern Ireland.

Most goods that are covered with safety and security information in export declarations will not need an exit summary declaration.

You need to make an exit summary declaration if;

  • an empty pallet, container or vehicle is being moved under a transport contract
  • goods have remained in temporary storage for more than 14 days
  • goods have remained in temporary storage for less than 14 days, but the import safety and security declaration details are unknown
  • goods are moved under transit using either a TAD or TSAD

When Will You Need to Make an Exit Summary Declaration?

You must submit an exit summary declaration before exporting the goods.

How to Make an Exit Summary Declaration

Exit summary declarations are submitted on the CHIEF in the same way as an export declaration, for goods exported from Great Britain, and the CDS, for goods exported from Northern Ireland.

What is Entry Summary Declaration?

An entry summary declaration is needed if you are moving into Great Britain, from Great Britain to Northern Ireland, or into Northern Ireland from outside the EU.

You must be registered for either the S&S GB service (bringing goods into the UK) or Import Control System Northern Ireland (bringing goods into Northern Ireland) to submit your declaration.

You do not need to make an entry summary declaration from 1 January 2021 to 30 June 2021 for goods that are imported into Great Britain from the EU or:

  • Andorra
  • Monaco
  • Norway
  • Liechtenstein
  • Switzerland
  • Ceuta and Melilla
  • Heligoland
  • San Marino
  • the Vatican City State
  • the municipalities of Livigno Campione d’Italia
  • the Italian national waters of Lake Lugano, which are between the bank and the political frontier of the area between Ponte Tresa and Porto Ceresio

When Will You Need to Make an Entry Summary Declaration?

There are different time limits depending on the type of transportation.

How to Make an Entry Summary Declaration

Besides the required documents and licences for your import, you will need information about the:

  • goods description or commodity code
  • consignor and consignee
  • type, amount and packaging of your goods
  • mode of transport at the border
  • onward journey details

Location-Based Notifications for Gökbora International Transport

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Customized Solutions with Modaltrans

Problem

Location-Based Notification is a system that instantly reports the date and time the vehicle arrives at the location or locations where it will receive and deliver the cargo, with GPS data during transportation. At the same time, it provides the opportunity to continuously track the status of the load with instant notifications. The general job description of logistics companies is transporting goods from one location to another. That is why delivering the goods at the planned time, is one of the most important parameters of productivity. In large organizations, the process is completed with multiple loading, customs and transfer points. Companies with large vehicle fleets need to control hundreds of vehicles that need to visit multiple locations to complete their tasks. Also, if we take into consideration that goods that may deteriorate or be damaged must be delivered in a short period, it is crucial for companies that vehicles arrive at customs and the destination at the planned time. For this reason, a system that helps to track the transportation process was needed.

Before Location-Based Notification System

Before the Location-Based Notification system, tracking a vehicle, whether it passed through customs smoothly and whether it arrived at the unloading point, was only possible by communicating with the driver. In addition, if we think that logistics operations must be tracked/followed from different departments, branches and companies, besides the difficulty of the data flow of the traditional method/procedure; calls, Whatsapp messages and mail load between parties negatively affected the productivity. Besides the financial consequences of the process not being planned and transparent, loss of trust and reputation between the parties is a serious threat logistics companies are facing.

With Location-Based Notification System

With Modaltrans’ Location-Based Notification system, Gökbora International Transport receives an email and notification from the system when vehicles approach the loading points, customs and unloading points. By using the GPS data, the time that has been wasted on the stopovers are reported. At the same time, when the vehicle left the exit point and arrived at the point of destination, the owner and the receivers of the goods can receive a departure-arrival notification depending on the preference. This facilitates controlling the operations that have more than one loading, customs and transfer points. Through the Location-Based Notification system, it is determined when the vehicle reached customs or the second loading point and how long it stayed there. Every 15 minutes, the system is updated and detects whether the goods arrived at the delivery destinations. A separate automatic notification is sent when the vehicle arrives, and when the goods are delivered. When the vehicle delivered the goods, information is directly coming to Modaltrans’ system and the status changes automatically. Especially, determining the status of the goods is the key element of this system. If the vehicle does not arrive at the loading and unloading point on time, the system reports the delay information by specifying the time and date.

Due to the instant tracking of the goods by Modaltrans and Gökbora International Transport, the logistics process is facilitated. Especially for 3PL companies such as Gökbora International Transport, to ensure coordination in different collection centres, warehouses and different countries and branches and to increase the in-team communication skills is very critical in terms of efficiency, Location-Based Notification saves a large workload and positively affects productivity. Besides, with the instant data flow provided by the system, it can automatically transmit the arrival-departure notification containing the load information to its customers. This strengthens customer relationships. In addition, due to the continuous control of the load situation and the notification of the staff within the team and to the other party, the intense communication traffic of the personnel also ends with the Location-Based Notification system, and the work efficiency of the personnel is also positively affected.

e-Commerce Management, Location Management and P&L Management Solutions for Seuco

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Customized Solutions with Modaltrans

Problem

Coffee vending machines in certain locations such as gas stations, usually have swiping machines as a payment method. It is a legal obligation to invoice the sold products in a daily basis. A list of sold products during the day is reported by appointed personnel, since it takes time and unnecessary usage of the workforce, the productivity of the business stumbles. There were some difficulties in analysing how much material used in the production of coffee and how much profit and loss did the machine caused.

Also, there was not any tool for checking the coffee machines and issue invoices in more than one location.

Before Modaltrans

Before e-Commerce Warehouse and P&L Management, Seuco was manually doing all these via Excel. Appointed personnel would issue the invoices and product information by examining the machines every other day or once a week. Then they were forwarding the collected information to the related person or they were the ones who are also responsible to fill out the documents. Then, they were listing every single sold product and the material that was used in the production of coffee. To analyse total cost and stock, even the material’s weight and the cost was being calculated manually. This caused problems such as errors in calculating, missing information, wasting too much time than necessary, extra workload. It affects productivity due to the increasing amount of margin of errors.

With Modaltrans

Modaltrans produced a solution to prevent projected and already occurred problems. By developing an e-Commerce Warehouse Management tool, Modaltrans enabled vending machines’ invoice and product information to transfer automatically and directly into the programme. Through these documents, related person/people can view whether the stock status is sufficient or how much shopping has been made and how much product has been used. We deduct the materials used by the sold product from the stock automatically, in this way, Seuco achieves more reliable and accurate results.

Besides, the P&L report is automatically reported at the end of each month, with the information collected throughout the month. For example, when a latte is bought, all the expenses like a paper cup, milk, depreciation of the coffee machine are listed automatically with the P&L report. We also share information such as rent, vehicle expenses and depreciation in the places where these locations are connected with the headquarters. All of these can be shared with the selected department such as accounting additionally. This reduces the troubled process of analysing and calculating. The personnel responsible for checking the machines are now able to take a photo of the coffee machines and add them to the relevant page for inspectors to review. Furthermore, defective machines can be easily identified in this way.

In addition, Seuco started to sell their products via e-Commerce sites and Modaltrans developed a similar system to the e-Commerce warehouse management system. The transactions from these sites will be added to P&L reports automatically. Thus, filling extra Excel documents will become redundant.

Edi Integration for Rhenus

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Customized Solutions with Modaltrans

Electronic Data Exchange (EDI) is the controlled transmission of relevant documents from computer to computer in a standard electronic format between business partners.

PROBLEM

Since business documents are customized in B2B applications, information confusion occurs when data exchange is required between businesses, and this prevents the correct execution of business processes. Especially companies working intensively with foreign countries needed a standardized format in data exchange in order to prevent information confusion and to save time and cost.

BEFORE INTEGRATION

Before the EDI integration, Rhenus was manually performing the information that needs to be transferred to the other party when performing its international transports. In other words, load, status and delivery information were entered manually by the personnel of the exporting region and transmitted to the importing region personnel. This was a waste of time in data transfer. This situation not only affected productivity within the office, but also caused the total duration of transports to be prolonged due to delays in the planning phase. In addition, due to manual processes, the margin of error was high, resulting in loss of confidence and cost increase.

WITH INTEGRATION

Modaltrans developed a solution for this problem and realized the EDI integration that the company needed. The data that needs to be transmitted while carrying out the migration process is organized over Modaltrans within the framework of EDI standards and is performed automatically. Thus, the party that will send the load enters the necessary information into the system. With Modaltrans EDI integration, it standardizes the data and transmits it to the other party in a complete and fast way. Thus, the margin of error is reduced, saving time and cost; More importantly, since there is no lack of information between the parties, the transport can be completed smoothly. Processes before transportation are carried out in a more planned, speedy and efficient manner thanks to this automated system that has been activated.

Modaltrans also automatically sends entry-exit and arrival notices to the parties. Container information will be shared automatically with the integration in the near future.

EDI integration, Rhenus cargo sender or receiver with Turkey, Rhenus transfers the relevant data in Germany or Spain. CMR information for land transport; The bill of lading information is transferred in EDI format for air and sea shipments. With the “Send EDI” button on the position, data is collected on the other party’s server in the SAP infrastructure.

What is a Warehouse Management System (WMS)?

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Warehouse Management is an operation that is frequently mistaken for “warehouse inventory management” which can be considered as the sub-heading of the WM.

While “warehouse inventory management” deals with processes like the accuracy of the products and their shipment; “warehouse management” handles the storage and the layout of the products in the warehouse.

Warehouses require precise, elaborated, and practical management to save time and money. Managing a warehouse can be a mess if you do not have an accurately placed system and if you are not keeping up with the new technology, you can fall behind in the competitive market. Warehouse Management Systems are developed to help you organize the process of warehousing and sometimes your other management requirements too.

Why is Warehouse Management So Important for Businesses?

When the items are ready for shipment, in a well-organized warehouse, all the process becomes easier and faster. Accomplishing a smooth operation is unimaginable without a warehouse management plan.

To have a warehouse management plan, first of all, one must identify the problems. The most common problems in the warehouse are usually:

Picking and shipping the wrong products = Which can cause wasting time by trying to fix the problem.

The wrong layout = If the products are not in the correct order in size, priority, or similarities, the storage and shipping process can be interrupted.

Stock and capacity = Knowing the stock of the products and the capacity of the warehouse is a vital part of the warehouse management plan. If the information about the stocks is deficient, issues like stockout and oversell can occur.

After identifying the problems, the only thing left to do is to find solutions. However, planning a way out of these problems can be challenging, as these problems are likely due to other underlying problems. To solve this confusion and to improve warehouse management, a very detailed and practical system is a need.

With the new technologies, creating a system is not that challenging as it used to be. Warehouse Management Systems (WMS) are developed to save time from all that paperwork, to improve the quality, and to avoid losing money.

Types of Warehouse Management Systems

Even though there are several types of WMS, four of them stand out. You will see the pros and cons of each type and it is up to you to decide what suits your warehouse’s needs.

1- Standalone systems

2- Supply chain module

3- Cloud-based systems

4- ERP modules

Standalone Systems

Standalone warehouse management systems are often low-priced, on-premise systems that are only preferred because of their warehouse management features. Although these systems can be seen as beneficial (they are in a way), the biggest problem with them is their lack of integration with other supply chain functions. Also, it takes so much time to implement.

Supply Chain Module

Supply Chain Management has a broader scope since these other types are the subcategories of it. It offers a great range of management experience. Unlike Standalone Systems, SCM does not only cover warehousing.

Besides its primary features like inventory management, sourcing, and so on, it can help to manage risk management and vendor and supplier relationships. Since SCM has a broader scope, if you already use other management software, to avoid overlaps, you should consider combining them with your current software. One other way is choosing an SCM that can be integrated rather easily with other software like ERP.

Cloud-based Systems

On contrary to the other warehouse management systems, Cloud-based WMS is a web-based software SaaS (software-as-a-service) model. This means that you can use Cloud-based Warehouse Management Systems with no need for installation and they provide a fast implementation. They are also noted for their flexibility, quick deployment, scalability, and security. It is a web-based software that can be used with any device with an internet connection (PC, mobile devices, tablets). Since hosting, configuration, and implementation are taken care of by the software vendor, you can save time and also lower the costs of updating and reinstallation. Cloud-based WMS is much easier to use and constantly updated according to the needs of businesses.

Because Cloud-based Warehouse Management Systems do not require hardware setup, and IT maintenance, you can reduce unnecessary fees.

ERP Modules

Enterprise Resource Planning is a software that offers multifunctional management features for the whole organization. It is usually used for its core applications like chain planning, customer relationship management, accounting, human resources, sales, and marketing. Not all the ERP vendors offer a Warehouse Management System, so if you are thinking of controlling all the organization from one system, you should be careful when shopping for ERP software.

The biggest issue with ERP is its cost and. If you are a small or medium business, costing and some of the unnecessary core applications might be a trouble.

The Impact of Covid-19 on Warehousing

Covid-19 not only changed the personal and societal living, but it also changed the basic operations of businesses. One of the most affected businesses were of course; logistics and supply chains and therefore warehousing. Physical shopping like browsing for needs, groceries come to a full stop.

A sudden demand for e-commerce created huge stress on warehouses and supply chains. Because the old way of drop shipping was not enough to satisfy the needs of the customers and oversupplying the “non-essential” products created chaos in the warehouses.

Also, the “just-in-time” system to lower the costs of inventory did not help the warehouses. The unpredicted demand on the essential products that were usually shipped from the nearest markets put the warehouses and the transport industry in trouble. While some of the warehouses shut down due to the lack of enough storage, the importance of warehousing began to get attention.

Modaltrans

Choosing the best system for your business can be challenging, it is important to work with a vendor that understands your businesses’ needs, and as Modaltrans we are here to help you.

Modaltrans is a cloud-based software that provides all-in-one business solutions for the logistics industry, which you can easily integrate with the ERP systems you use.

For all forms of logistics; freight forwarders, fleet operators, 3PL’s, shippers, Modaltrans offers an all-in-one system to ease your work-load.

With the WMS module we provide, you can control the day to day operations of your warehouse via integrated racking labels and a handheld terminal app with barcode reader for picking and putting away tasks. You can easily control your warehousing processes with our simple interface. We are offering assistance in every step of your journey.

Wearable Technology Steps in the Logistics Industry

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I guess we understood and felt wearable technology most clearly with smart watches. 

Today, smart watches do not replace phone menus any more. It started to be involved in the processes even in commercial matters. Speaking with other devices and providing uninterrupted communication. Dozens of new devices that increase operational efficiency in the logistics sector have already been added to accessories such as glasses, wristbands and watches.

Although various technological applications are encountered at different layers of the supply chain, it is possible to say the warehouse side as the area where technology is most deeply penetrated. It is evaluated by experts that technology-supported improvement studies in warehouse operations can contribute around 30% to warehouse efficiency. The use of technology eliminates manual entries in warehouse management and automates many processes, setting a good example for the logistics industry.

Thanks to the wearable technology, the information of the products can be accessed effortlessly in the warehouses of cargo and logistics companies, and the devices can be used without causing movement impairment thanks to the wearing of the device. It also eliminates manual entry of data logging with automatic processing, which increases the margin of accuracy.

Thanks to the increase in accuracy and automatic data collection, the processes carried out are accelerated and it provides significant cost savings.

In addition to financial gains, employees who use the device are monitored from body temperature to heart rhythm and provide early intervention by warning in case of an unusual situation.

DHL recently completed a pilot project testing smart glasses and augmented reality systems at a warehouse in the Netherlands; the result conveyed a 25 percent yield increase during the collection process.

Smart glasses provide information about where items are located and where they should be placed, as well as visual images of order picking instructions.

Not only warehouse management. Also designed for drivers, smart glasses can recognize the best route to certain items thanks to their indoor navigation capabilities, thus significantly reducing travel time with more efficient route planning.

Augmented reality systems currently offered by companies such as Knapp, SAP, and Ubimax consist of a smart glasses display, camera, wearable computer and battery pack.

Another technology is a tattoo-like product made of skin-compatible ingredients. MIT PhD students and a team from Microsoft Research have developed a new system called DuoSkin, a type of “smar”’ tattoo that can turn your skin into an interface to control your mobile device. DuoSkin is a manufacturing process that allows anyone to create customized functional devices that can be attached directly to their skin. It has three types of on-skin interfaces using gold metal leaf, which is an inexpensive, skin-friendly and sturdy material for daily use. These are: Touch input sensing, output display and wireless communication. DuoSkin devices allow users to control their mobile devices, view information, and store information in their binder, while serving as a personal style statement.

Another technology is smart watches. Based on the Pebble Smartwatch, W&H Systems “Shiraz” allows warehouse managers to collect critical key performance indicators to better manage deployment and fulfillment operations from the wrist. A warehouse manager can be at the meeting and see the activity that requires him to make an immediate decision on his smartwatch and action can be taken on his smartwatch.

With the Shiraz Warehouse Control System, they can look at key KPIs to ensure customer orders and service levels are met, monitor stock levels and audit operational performance. With the smartwatch, they can also receive emails, voicemails, text messages and notifications that allow them to see what is happening in their distribution operations. They stated that Shiraz visualizes warehouse operations and provides critical incident reporting with email and text alerts that keep management up-to-date 24/7.

Compared to the examples above, barcode readers used in the form of rings, which are more accessible in the sector, are used. With the barcodes on the products, product information can be obtained with a single click without long-term product registration. Although not as advanced as other systems, barcode readers are widely used because they are more cost effective.

A study conducted by Honeywell in North America, Latin America, EMEA and Asia Pacific countries reveals that improvements in workflow can save at least 30 minutes per technician per day. This means savings of approximately 875 thousand US dollars a year.

According to the information given in MUSIAD’s 2017 Logistics Sector Report, it is expected that by 2020, 30 billion devices according to some sources and 24 billion devices according to some sources will be connected to each other. 10 billion of these will consist of phones we use, tablets and wearable systems. Billions of dollars worth of resources will be transferred to Internet of Things (IoT) solutions such as the development of this system, preparation of applications, device hardware, system integrations, creation of data storage systems, security and connectivity. The recycling of these resources is calculated as 13 trillion dollars until 2025.

Gartner company, which conducts important research on this subject and publishes a report on this subject, thinks that interconnected objects increased by 30% in 2016 compared to 2015 and reached 6.4 billion. Expressing that 5.5 million objects are connected to each other every day in 2016, it estimates that it will reach 20.8 billion by 2020.

Global Freight Forwarders – TOP 10 forwarders

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Before moving on to the main topic of this blog post, let’s understand what Freight Forwarding is.

Freight forwarding is the planning and coordinating of the movement of commodities across international borders, on behalf of shippers. Other tasks involved include, but are not limited to: warehouse planning, supplying cargo insurance, and customs brokerage.

Freight forwarding consists of strategic logistics planning and execution for the international movement of goods, on behalf of shippers. Specifically, a freight forwarder will carry out freight rate negotiations, container tracking, customs documentation and freight consolidation, among other tasks.

Importing and exporting creates lucrative opportunities for businesses with the wherewithal to execute strategic logistics plans. But the logistics of international shipping is complicated, to say the least. 

It requires:

  • Expert knowledge of customs standards and protocols, which vary country to country and even port to port
  • Agile problem-solving, for when the weather, technology or human nature fail to cater to timely travels, as they are all wont to do
  • An instinct for network building, because in many ways, a supply chain is only as strong as the parties propelling it. 

And you also need a license to do it. Depending on the type of transportation means they work with (sea, air or road), freight forwarders need to get different licenses. Although the terms and costs of these licenses vary from country to country, you must obtain a license from the relevant institution.

Freight forwarder carries a license requirement for the correct implementation of legislation and procedures. At the same time, the freight forwarder is responsible for the freight. For this reason, certain conditions are imposed on those who want to do this job.

What is the Role of Freight Forwarder

  • Shipment Tracking – Forwarders use a Transportation Management System (TMS) to maintain transparent visibility throughout each stage of a shipment’s voyage.
  • Customs Brokerage – This critical piece of forwarding requires special licensure—a customs brokerage license. Licensed brokers are the only people qualified to manage and submit the extensive documentation necessary to complete importing/exporting processes. 
  • Warehousing – Some forwarders may have their own warehouses available to harbor shippers’ commodities (or parts of commodities), but for the most part, the service your forwarder will offer is to arrange storage at a warehouse owned and operated by a conveniently located affiliate.
  • Negotiating – Bargaining with carriers for cost-efficient shipping rates is no easy task. The art of this deal entails appealing to carriers’ interests by balancing the pros and cons of your cargo type, time flexibility, credit status, space/tonnage requirements, and more.
  • Cargo Space Scheduling – Savvy coordination and scheduling of cargo space are the more tangible parts of a forwarder’s skill set. If you hire a freight forwarder to manage logistics, this is where they’ll have the opportunity to display their chops. It takes a thoughtful planner to determine whether it is profitable to consolidate a shipment, to secure timely sailings, and to weigh the feasibility of intermodal shipping options. Cargo scheduling is the logistics of “Logistics.”
  • Consolidating Freight – Forwarders may have several customers who all need to transport shipments that do not necessitate the use of an entire container. Freight consolidation for less than container load (LCL) shipping is a service forwarders provide wherein multiple smaller consignments are all booked aboard the same container. In these instances, the shipping cost is spread amongst all participating customers based on the cargo’s space requirements.
  • Supplying Cargo Insurance – Forwarders can provide you with a cargo insurance policy, also known as freight insurance. Cargo insurance is intended to reimburse the loss payee in the event that goods are damaged or stolen in transit.

Now let’s move on to the foremost companies that are leading the Freight Forwarders List.

Top 10 Global Freight Forwarders 

RankProviderGross Revenue (US$ Millions)Ocean (TEUs)Air (Metric Tons)
1DHL Supply Chain & Global Forwarding27,3023,207,0002,051,000
1Kuehne + Nagel25,8754,861,0001,643,000
2DB Schenker19,3492,294,0001,186,000
3DSV14,3551,907,1261,071,266
4Sinotrans11,2003,770,000502,000
5Expeditors8,1751,125,137955,391
6Nippon Express19,953703,061752,942
7CEVA Logistics7,1241,050,000416,000
8UPS Supply Chain Solutions9,302620,000965,700
9C.H. Robinson14,6301,000,000210,000
10Kerry Logistics5,2741,250,038409,408

*Revenues and volumes are company reported or Armstrong & Associates, Inc. estimates. Revenues have been converted to US$ using the average annual exchange rate in order to make non-currency related growth comparisons. Freight forwarders are ranked using a combined overall average based on their individual rankings for gross revenue, ocean TEUs and air metric tons.

(updated July 23, 2020)

Is it worth to build your own logistics software inhouse?

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TMS-system: what is it and how to choose the right one?

You can manage freight in different ways. Someone still manages spreadsheets, while someone monitors the goods through the TMS-system. However, the functionality of most such systems is often not enough to fully manage the logistics in the company.

A transportation management system (TMS) helps companies move freight from origin to destination efficiently, reliably, and cost-effectively.  Today’s more capable TMS solutions offer a strong ROI.  Primarily, a transportation management system can save companies money by lowering their freight spend.  ARC’s survey-based research found that respondents indicated freight savings of approximately 8 percent with the use of a transportation management system application.  Of these savings, nearly 60 percent of users indicated that less than 10 percent of the net savings were absorbed by the TMS.  These freight savings can be attributed to network design, load consolidation, multi-stop route optimization, improved data for procurement, and freight audit.

So what is it for, and what problems does the TMS system solve?

First of all, the TMS-system is a necessary tool for enterprises providing transport logistics services (trunk transportation, targeted delivery, transportation of dangerous goods or goods with special temperature regimes of transportation) or for companies delivering goods and cargo to their customers on their own (manufacturers or distributors).

The main objective of TMS is to offer a delivery route that will be most cost-effective for the company, taking into account all the conditions and parameters of transportation, and the most beneficial for the client from the perspective of delivery time and cost, cargo safety and reliability of the logistics operator in the future.

For example, one European manufacturer of building materials in its business model laid down a rule according to which, no matter what happens – the products must be delivered to the client within the time specified by the contract. For example, due to malfunctions in the production, a batch of building materials was produced and transferred to the warehouse with a delay of two days. In this case, the logistics department must find the fastest, but perhaps not the most profitable option for delivering products to the client. The result of such delivery will be analyzed later, but the client should not suffer.

Imagine how much you need to take into account the parameters and restrictions, so that delivery to another part of the country would not be with a huge minus. This company solves such transportation problems in its TMS-system, which already has criteria and parameters for choosing optimal delivery conditions in the production force majeure mode. As a result, on the “honor” board there are not photos of heroes from the logistics department, but a report on the results with a case to improve performance in such conditions. People just did their job using an efficiently working tool.

Companies to which the Transport and Transportation Management System is primarily suited:

  1. Transport companies owning their own fleet of cars of any type and carrying capacity. And the larger the park, the better, the more effective the application of TMS.
  2. Companies engaged in trunk, inter and multimodal transportation. In those cases when during the transportation of goods there is a change in the types of vehicles (dry cargo – plane – car) or it is necessary to go through the border crossing procedures of several states, possibly with intermediate storage in reloading hubs – the information load on the logistics manager increases at times, and the accuracy and information processing speed drops.
  3. Trading and distribution companies that distribute goods from their warehouses through a wide network of their own stores and points of sale of their customers.
  4. Production companies that need to organize and control the delivery of raw materials to the enterprise, and then the finished products through the network of their customers.
  5. Post and courier private and public services.
  6. Service companies providing targeted delivery of various goods and goods within settlements.
  7. Companies with construction equipment that provide special services: garbage collection, power grid maintenance, installation or repair work, etc.
  8. Companies providing passenger transportation services both within settlements and long-distance, international.
  9. Agricultural companies that own all types of agricultural machinery (combines, tractors, fuel trucks), as well as must control the transportation of agricultural products from the field to storage.

In fact, the use of modern transport management systems created on the basis of the TMS platform is not limited to the above areas. Modern transport is developing very quickly, and who knows, perhaps in the near future we will control cargo drones and electric trucks with autopilots. But move on.

What can be automated in transport logistics? Globally, two things are automated:

  • All main or supporting processes that directly and indirectly affect the management of transport logistics are automated.
  • Automation is associated with the use of software and hardware systems or only the logic of processes is automated.

Why do companies need transport automation?

  • To organize and store all the necessary data and events for making management decisions.
  • To increase the efficiency of the enterprise and the business as a whole.
  • To maximally exclude the influence of the human factor.

A company may not always have its own fleet of vehicles, but wants to control the delivery time of its goods to its customers. In fact, without its own machines, the logistics of such a company manage virtual entities, that a certain “Gazelle” doesn’t matter with which state number and which driver it will deliver the goods to the customer’s store from 11:00 to 11:15. The main thing is that the system allowed us to calculate the type of machine and the delivery time.

In another case, it is important for us to calculate the costs of long-distance transportation, again carried out by the contractor and add our earnings taking into account all logistics operations: loading / unloading, transportation of ton / km or mileage from point to point, etc.

But most importantly, it is important for us to minimize the influence of the human factor, low-skilled mistakes and fatigue, reduce the time spent on planning and find out the causes of errors.

Example 1. The retailer company, which has a large network of stores for planning the operation of its fleet, which is more than 200 cars (transportation of goods between stores, picking up goods from suppliers, maintenance of vehicles) allocates up to 10 people and spends from one to three hours every day to discuss the work plan and routes. And it is very fluent, along the way finding out where the cars and drivers.

Example 2. For two days, the transport company could not deliver the machine, as it constantly confused settlements with the same name, but located in different regions of the country. The difference on the route was 500 km of extra mileage. In its pure form, the human factor.

Therefore, let’s see with you when it’s worth considering automation of transport logistics. Returning to the areas and lines of business that can be recommended for transport automation, the most important criteria are:

  • You are a manufacturer / distributor of goods. Your company regularly delivers its products across a wide network of consumers.
  • You have an ATP. Your car fleet is growing, and you feel that handling and transparency are falling.
  • Manual transport control has become ineffective. You spend a lot of time planning and controlling.
  • Your transportation costs are growing disproportionately to profits.
  • Abuse You are faced with improper use of vehicles by drivers or your contractors are not fulfilling their agreements.
  • You own special vehicles. You have more than 30 units of office or service vehicles that need reasonable planning and control.

What other complex problems are observed in the field of transport logistics:

  • high cost of transportation.
  • inefficient use of transport.
  • the planning process is based on subjective opinions.
  • there is no way to change routes online.
  • no information for analytics.
  • additional human resources are used.

How to solve all these problems and make your logistics work more efficiently, and for companies providing logistics services to increase the loyalty of their customers and make fewer mistakes. After all, at stake is not only the reputation, the profit and survival of the business are at stake.

The TMS transport management system, of course, is not a panacea, it is a tool that you need to learn how to use and use with maximum efficiency. But let’s see what it is and how to work with it.

Today it’s not enough just to buy or download a program and start using it. This kind of software needs to be configured and adapted to the company’s business processes. For complex automation of transport logistics, the following solutions and technologies are applied:

  • Software – Transport Management System (TMS).
  • Hardware and software solutions: computers, smartphones, cloud servers, GPS trackers, controllers and sensors.
  • The work of experts with case studies for specific areas: trunk, multimodal, targeted delivery, etc.
  • The presence of systems and techniques for business analysis, data collection and processing.
  • Application of project management for a quick and effective start of a transport logistics automation project.
  • Availability of solutions provider based on WEB technologies.

What effect can companies that have decided to implement a transport logistics management system have applied, have applied modern solutions, methods and approaches to the project as a whole. Here are some examples of indicators that were achieved after 2-6 months of operation of the TMS system.

  • Planning time is reduced by at least 20-30%.
  • 99% fulfillment of customer requests.
  • The cost of maintaining the fleet (fuel, lubricants, runs) is reduced by 12-30%.
  • Fleet reduction by 12-25%.
  • The productivity of personnel (dispatchers, logisticians, warehouse) increases by 15-40%.
  • Reduced staff costs by 8%.

So, if we combine all of the above, then the Transport Management System is software for route planning, monitoring the movement of vehicles and conducting a plan-factor analysis of scheduled flights on-line. Designed to automate the work of enterprises with an organizational structure of any complexity and optimized to work with a large number of machines (from 10 to several thousand).

The mission of TMS is to help the transport departments of trading, manufacturing and logistics enterprises to use the available transport in an efficient, economical, informed and convenient way.

Today, inside the TMS platform itself, you can select separate modules for automating certain areas of transport logistics:

  • General transport management system.
  • Management of trunk transportation.
  • Address delivery management.
  • Dangerous Goods Management (ADR).
  • Management of transportation of fresh and frozen products.
  • GPS monitoring system for all types of transport: auto, railway, water transport.
  • Management of agro-logistics and field equipment (Agro TMS).

Let’s look at the capabilities of the TMS-system from the side of logistics management. So what can the system do:

  • Automatic route planning based on more than 100 parameters and conditions: parameters of delivery / loading points, freights, GVH, kilometers and detours, vehicle parameters, driver data, fuel consumption rates, seasonality, etc.
  • Manage fixed routes: edit more than 30 parameters of routes and route points, set detour points, set rules for generating events and controlling the route (deviation, execution on time / late, fix radius, etc.), create routes along the track, include the route in the group , give users access to route groups, create copies of routes, shift the start time of the route.
  • Fasten the vehicle to the route both automatically (after passing a set of geo-zones specified in the route), and manually on the waybills.
  • Track the movement of vehicles on the map online with overlay on the maps Google, Yandex, OpenStreetMap, Here (NokiaMap), etc.
  • Monitor events related to ingredients, speeding, opening doors, temperature changes, and more.
  • It has a mobile application for the driver, forwarder, courier, sales representative, merchandiser, service engineer, security service, etc. The ability to record events and their statuses at route points.
  • Distribute rights and individual settings for individual groups of operators, dispatchers and logisticians. Including for regional offices.
  • Set up individual tips and alerts for the logistician, dispatcher and driver (SMS, e-mail, interface pop-up messages).
  • Collect data online and compare the plan fact using the business analytics module for analysis and forecasting of both logistic events (route forecasting) and economic (what will be the cost of a new route).
  • TMS has the necessary reporting set, which allows you to quickly build (200 thousand records in about 30 seconds) reports on movement, plan fact, on speeding, and so on. The report designer allows you to visually create your own set of columns and graphs from the list of available.

But the system needs to be maintained and developed, therefore, if a large logistics company has its own IT service, then the main features of a TMS system from IT will be:

  • Modular architecture with the ability to create redundant nodes, which avoids stopping the entire system if one module or node (physical server) fails. It also allows you to do horizontal scaling to increase capacity, if necessary, serve more requests per unit time.
  • A flexible structure for assigning permissions to users on functions (access to certain actions, access to certain directories) and data (access to part of the data of directories). This allows the user to configure access only to those objects and functions that are necessary for him to perform his work.
  • The ability to integrate with Active Directory-based security allows you to centrally manage employee access not only to software but also to other company resources.
  • All TMS directories, with access rights, have the ability to upload data to exchange files.
  • All user actions are recorded and can be viewed in the form of reports.
  • TMS can carry out tracking on the Android tracker, on a mobile application for Android / iOS, work with various types of GPS / GLONASS trackers (you can connect any with an open data exchange protocol).
  • TMS allows you to keep track of fuel consumption by fuel level sensors, flow sensors, CAN and OBD buses.

However, if you do not have a large company and your support is limited, then all technical issues can be moved to the “cloud” and rented software, paying only for logistics functionality. All system settings, integration with the accounting system and connection to devices will be taken over by the TMS provider. This model is also called SaaS (Soft as a Service).

Modern information technology in logistics is even closer to the use of artificial intelligence, BIG DATA and Blockchain. Solutions based on TMS, unlike other solutions for SCE (WMS, YMS), have developed most clearly in this aspect. Already, the accuracy of forecasting the concentration of orders, for example, for water suppliers is at least 89% (up to 97% in some projects). And the data collected over several years allow us to predict the economic effect for almost any scenario related to changes in the market situation for transport logistics companies.

“Coronavirus” Impact on Logistics Industry

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The coronavirus epidemic has a significant impact on the transport industry. Chinese New Year holidays smoothly went into quarantine, and shipments from the Middle Kingdom stopped. 

Even before the Chinese New Year, manufacturers tried to ship as many goods as possible, catch them on ships and railway trains at any rate. During the epidemic, Chinese agents tried to provide online work, but the situation was sluggish due to the closure of Chinese production.

Interruptions in factory operations in China caused by coronavirus disrupt the supply chain and make production impossible at industrial plants around the world. This, in turn, leads to a decrease in fuel production.

What will happen to the supply chain now? When will the situation begin to improve? What consequences are expected to happen with freight rates, railway tariffs?

Aviation – the most modern and most vulnerable.

$ 113 billion. Such “crazy” money risks losing due to COVID-19 world civil aviation. These estimates were published by the International Air Transport Association (IATA). At the same time, only about three weeks ago, the same organization estimated the potential losses of “just something” at $ 29 billion. This difference was explained by the fact that “the basis of previous assessments was the scenario according to which the influence of the coronavirus will be limited to markets associated with China.” Now the situation has changed – due to significant problems in many other countries. Which can reduce industry profits by 11% (positive scenario) or 19% (in the worst case).

This will lead not only to economic losses, but also to the bankruptcy of airlines that do not have a financial “pillow” in case of protracted force majeure. Much also depends on the flexibility of the companies themselves and their ability to adapt to new conditions. In particular, the ability to stimulate the growth of passenger traffic due to price discounts and other bonuses.

Shipping and port industry.

Back in January, due to quarantine and the resulting shortage of labor at enterprises and ports in China, a number of regular commercial flights from China to the United States and Europe were canceled. In general, cargo transshipment by sea slowed down around the world. Weather disasters were added: due to powerful storms, a number of departures had to be canceled, the delivery of some goods was delayed for tens of days. Damage experts estimate at $ 1.5 – $ 5.5 billion.

Currently, shipments from China are made, sea lines reduce freight to fill ships, rates compared to New Year’s are significantly different, but, according to experts, rates will return to the previous level by the end of March, as shipments continue. There is a tendency to change the direction of cargo flows. Part of the shipments will be transferred from the sea to the railway due to a more attractive transit time, since the shortage of products due to the interruption in supply will affect and will not go unnoticed.

Air shipments are partially suspended, and everything will depend on the policy – whether air traffic from China, Korea, Europe and other countries will be closed. 

In the situation with coronavirus, the development of further events depends on political actions.

Of course, transportation will not stop – logistics is needed always and everywhere. But there will be a redistribution of flows, new routes, new suppliers, which can hardly be comparable in value to China. So we are waiting for higher prices for goods in general.

For many logistics companies, any crisis situation is an opportunity to show their experience, professionalism and competence in offering alternative routes.