A Hong Kong startup is dragging the international shipping industry into the 21st century

International shipping is a US$700 billion per year industry across land, air, and sea. The people keeping those trucks, trains, planes, and ocean liners full of the world’s cargo are called freight forwarders. These companies and individuals act as travel agents for pallets and containers, coordinating each step of getting goods from factory to store shelves.

To get something shipped, a company typically calls up one or more freight forwarders, gives them the details, and waits up to one week for a final price quote. It’s a slow process of excel spreadsheets, PDFs, and faxes that makes it hard to guarantee the best prices and leaves many containers unfilled, but in an industry that’s literally centuries old, the status quo doesn’t change fast.

"The whole of world trade depends on this," says Zvi Schreiber, founder of Hong Kong-based Freightos.

Freightos is trying to inject some much needed exigency into the sector. It’s the first company in the world to offer instant quotes for end-to-end freight shipping. Just type in what you’re shipping and where you want it to go, and you’ll get a quote in seconds. Routes and pricing are automated.

So how did Schreiber manage to convince the forwarders – who previously never shared their rates with the public – to join his network?

"We help them evaluate the business cost of not opening up," he says. "Secrecy is costing them both revenue and profit."

In the beginning, it wasn’t an easy task. Schreiber and his team hustled to convince freight forwarders that the cost of ultimately getting a sale using the old non-transparent methods was eating up all their profits. More recently, though, the company has reached a tipping point, and the forwarders are drawn to the startup.

"There’s been a lot more inbound interest. We used to have to go hunt down customers," he says, "Now we’re getting them coming to us almost daily."

Schreiber didn’t reveal specifics, but says he has some top 10 multibillion dollar freight forwarders and Fortune 100 companies on his growing roster of customers. Freightos returns several thousand quotes every month at millions of price points. Of course, some forwarders still prefer the old way. "There’s always some freight forwarders who are too conservative for this," he says.

Customers pay a monthly fee to use the service, and in return can get a quote for shipping a container or pallet including shipping trucking, handling, and insurance. In addition to a higher frequency of deals, freight forwarders can also adjust their prices on the fly to discount last-minute space and maximize efficiency and revenues.

Refining the pallet

Schreiber, a UK native who spent most of his life in Israel, first experienced the inefficiency of the shipping world while managing one of his previous companies, an electronics business he later sold to GE. "It just amazed me that it took so long to get a quote," he says.