Shippers reward forwarders that hold rates through disruption, Miami forum told

Forwarders that protected contracted rates during China's capacity crunch won a larger share of Veralto's freight the following year, the company's director of transportation and logistics told TIACA's Air Cargo Forum in Miami. The lesson is commercial, not sentimental. Performance under pressure moves volumes.

Executives from Veralto, Lockheed Martin and GE Vernova told the panel that how a forwarder behaves during a crisis influences subsequent contract awards, often carrying more weight than the headline rate. Mitch Marx of Veralto described how, while most providers introduced surcharges during the China crunch, one worked to protect contracted rates — honouring them for originally awarded volumes while charging more only for additional cargo.

"They got really creative, and so for the next year, the next negotiation, we placed an emphasis on moving as much of our volume to that freight forwarder as we could," he said.

GE Vernova's logistics sourcing representative said strong providers could win extra business throughout the year, including bids for spot shipments and project cargo outside the annual tender. But disruption told a different story. During the Middle East conflict, too many conversations with forwarders collapsed into pricing.

"It turned into how much are you willing to pay?" she said. "We're really looking to find partners that are more willing to think outside that box."

Does loyalty guarantee the tender?

Not quite. Mark Chadwick, president of the Global Shippers Association, stressed that loyalty did not exempt providers from competitive tenders. Equally, failing to post the lowest price did not automatically rule a forwarder out. Past performance and relationship quality influenced decisions in ways that, as he put it, might not appear on a procurement spreadsheet.

The panel also flagged a gap in specialist capability: handling highly regulated defence cargo. Lucas Martin, global logistics lead at Lockheed Martin, said general capacity looked sufficient, but questioned whether enough providers held the regulatory capability for difficult shipments as production scales.

"When it gets to the stuff that's really hard to move, and there's only a certain number of people that can move it, I think we'll see some challenges when we get to full-ramp production," he said. Providers that struggled, he added, typically lacked product familiarity or suffered communication breakdowns.

Where did the technology pitch go?

Customer-facing technology drew scepticism. Marx noted that forwarders had once promoted their systems heavily, but that activity had taken a back seat while providers concentrated on moving freight. GE Vernova's representative said even a basic Excel download of shipments in transit could prove difficult — information that seven or eight years ago providers supplied within minutes.

She also identified a gap between executive-level polish and the operational response when chasing individual shipments. "The level of urgency isn't there. The level of detail isn't there," she said.

Martin drew a harder line. Some technology proposals sought access to purchasing systems and supplier information that Lockheed Martin would not provide. "That's always going to be a hard pass for us," he said. "It seems to be the technology is getting a little more intrusive."

Speed or consistency?

For Veralto, better service did not necessarily mean faster transport. Predictability mattered more, particularly for consumables replenishing distribution sites. An eight-day transit could replace a five-day one, Marx said, provided it was consistently eight days and the business could plan around it.

That trade-off extended to mode choice. Higher airfreight costs had pushed Veralto to shift suitable traffic to ocean, though working capital, inventory turnover and product expiry dates constrained the switch. Sea-air offered the compromise when a full ocean transit was unacceptable.

The message for forwarders was plain. Understanding a shipper's constraints — and proposing workable alternatives — could be as commercially valuable as winning the next competitive rate.