What Matters in Supply Chain Visibility

This is the second edition of Importing Bunk...my (not-so-)weekly newsletter that allows me to explore ideas in more depth as it relates to international (and sometimes domestic) supply chains.

One of the things that gets me completely frustrated with the state of affairs, and depressed about our collective ability to tackle matters, is the concept of visibility, and how that term is used.

For this analysis, there are basically two categories of players: 1) Importers/BCOs/Shippers, and 2) Everyone else.

Let's start with everyone else.

Visibility for Everyone Else

These actors include forwarders, carriers, customs brokers, and technology providers.

For these actors, visibility is simple. Visibility means either a) where is a shipment, or b) when should it arrive.

There are whole industries built around this concept of visibility.

Forwarders compete on their ability to make this data available to their BCO customers. It is their belief that because the BCOs are constantly complaining that they don't have the data they need to make decisions, they would compete better than their peers if they can provision data to their customers. And they aren't wrong.

The better the data is that they are able to provision to their customers, the better they ought to do.

Enter the technology providers.

They are quick to spot a problem and engage to deliver a solution. For the forwarders to be able to provision good data to their customers, they need to get data from carriers. But there are lots of modes with lots of carriers. This creates a big technology problem. And so companies like project44 , VIZION , Windward , Gatehouse Maritime , Terminal49 , et al, come to the fore to solve that technology problem, creating centralized hubs of data aggregation. Now, freight forwarders are able to go to one stop, and get their status update messages from the carrier in one fell swoop.

This should solve the visibility problem once and for all.

But it hasn't.

Or maybe it has solved a problem...but not the problem.

We need to understand that different players have different requirements and objectives. Forwarders (and carriers, and customs brokers) can only do so much. They move shipments. That is, they move boxes, pallets, envelopes, etc.. And it is their job to move these boxes in a planned method with as little variability as possible.

And there's the rub.

The international supply chain is anything but certain. Vendors are uncontrolled. Carriers run into issues that create variability. Customs inspections create delays. Port worker strikes. International crises. Water level declines. Rockets. Price variability. Blank sailings. And so on.

The request from the BCO or shipper is that a) they work to plan, and b) when they cannot work on plan they get updated.

So, the forwarders and other service providers need to be able to communicate the plan and adjustments to the plan.

That's a pretty low bar. And it is NOT the complete picture of visibility that the BCO or shipper requires.

Which brings us back to the BCO/Shipper/Importer.

What does visibility mean for them?

Visibility for Importers

(For the record, I will use BCO, Importer, and Shipper interchangeably. Yes, there is a technical difference between them, but for the purposes of this discussion it is immaterial.)

What does an Importer do?

They buy goods, move those goods from overseas, (potentially transform or assemble them), and then sell them to customers.

It's pretty simple.

The complexity arrises when you start thinking about how business are managed. Managing a business is hard and multivariate. It isn't as simple as making sure that the right product is in the right place at the right time. There is a cost to make the goods. There is a cost to move the goods. And there is a cost to store the goods.

(I'm going to ignore the complication of regulation for the purposes of this post...but that just increases the implication of everything I am saying here.)

To make this clear, there are three dimensions that seem quite important: the product, the cost, and the time.

An Importer's job is nail all three.

Nailing two of three in a sustained way results in going out of business.

Which means that Importers need to have reasonably good control on all three dimensions.

Which means that Importers need to have information related to all three dimensions to be in control.

Which means that they need visibility into the underlying data to manage that information.

Which means that simply getting ETAs and ETDs from forwarders is somewhat trivial compared to the overarching problem.

I will leave it to a subsequent Newsletter to discuss the specifics of the underlying data that is required to satisfy 'visibility' for Importers. But suffice it to say that it is dramatically more complicated that ETAs and actuals.

Visibility in the international supply chain is a multifaceted challenge that goes far beyond simply tracking shipments. For Importers, true visibility encompasses a comprehensive understanding of product, cost, and time—three critical dimensions that must be managed in tandem to ensure business success.

While service providers like forwarders and technology companies focus on delivering shipment data, Importers need much deeper insights to control their operations effectively. In future editions, I'll dive into the specific types of data Importers require to achieve this level of visibility, highlighting the complexities and solutions that go well beyond what current industry practices offer.