Freight shipping is the backbone for much of the world's commerce. With hundreds of ports across the world, the amount of possible shipping routes is staggering — and the amount of paperwork associated with them even more so.
The shipping industry, in many ways, lags behind other industries when it comes to digitalization. There is little standardization between carriers, freight forwarders, and shippers.
Every market participant has their own approach to organizing their shipping documentation and in aggregate there's little method to the madness. Any two rate sheets specifying prices for shipping containers between two ports will include many complexities and caveats related to surcharges, terminal handling charges, currencies, validity periods, and feeder ports.
As a benchmarking and analytics platform, Xeneta collects and ingests millions of rates every month. Our role in the industry is to provide accurate and up-to-date market data that helps you make the best decisions about your freight. And to make effective decisions, your options must be comparable and understandable. Yet, by the nature of the industry, collecting all the different segments of information from all the participants isn't enough — it needs to be transformed into structures that can be compared.
This transformation is handled by Xeneta's Rate Management Team, our internal group of freight industry experts. Using a combination of automated tools and individual expertise, Rate Management analysts oversee the processing and validation of thousands of freight rates daily.
As the team works with sensitive data, all Rate Management analysts are located in Xeneta's headquarters in Oslo, Norway. Access to this data is controlled, following industry-standard cybersecurity best practices, and available only on a need-to-know basis
Moreover, the Rate Management Team is organized into two groups: one for freight forwarder customers and one for shippers. In this way, the team is structured to respond to all of Xeneta's different customers and their specific needs.
Working with Tech
The Rate Management Team works closely with the Internal Tools Tech team to develop custom software and processes for adding and managing freight data. The Rate Management Team lays out their pain-points and communicates upcoming changes in freight regulations to the Tech team and the Tech team responds by creating appropriate tools to help scale and simplify rate management efforts. Because of the close working nature of the two teams, all planned features can go through rapid user testing and suggestions can be quickly iterated upon and turned into solutions.
Tight collaboration is especially important with large changes in the shipping industry, like the upcoming IMO 2020. As freight experts, the analysts of the Rate Management Team help get software developers up to speed with the improvements required for the Xeneta platform and assist with testing when the market changes in response to new regulations.
Ensuring Data Quality
The core of the Xeneta platform is built on trust — customers should never be asking "do I believe the data I'm seeing?"
The Rate Management Team ensures that Xeneta market data is accurate through a number of data quality algorithms, as well as manually checking certain parameters.
Any freight rate submitted into the Xeneta system is automatically run against a few basic quality checks like:
- Do the origin and destination ports exist?
- Are the contracts valid in the right time frames?
- Are there any new or unexpected surcharges?
- Do the terminal handling charges agree with expected methodologies?
Once the system answers these questions, the freight rates are checked for duplicates to ensure that prices aren't skewed by repeated appearances of the same freight contracts. This step is especially important because freight data is messy — to this day spreadsheets are king in the shipping industry and user error is common.
Finally, the freight rate data enters outlier detection, where rates are compared to existing rates on the appropriate trade lanes. Outlier detection is done to find erroneous and otherwise incorrect values that might pollute the dataset. An example of an outlier might be a freight rate that is five times higher than any other value that ever appeared on that particular trade lane.
Outlier values are automatically reported by the system and an analyst on the Rate Management Team is notified. An analyst will manually check outliers to ensure there aren't any false positives being excluded from the pool of valid freight data.
A Day in the Life
A typical day for a Rate Management analyst will include scanning through newly-submitted freight rates from customers, responding to customer queries, and managing their individual part of the rate import process.
The freight market is dynamic and has very little seasonal downtime. As such, the Rate Management Team is always engaged with incoming freight rate data. Some peak season events — such as the time leading up to Chinese New Year and tender seasons — create particularly high-paced weeks when the whole shipping industry kicks it into high gear. In these periods, the Rate Management Team has to be on their toes and ready to quickly respond to a deluge of new freight rate data.
As some of the few people in the world who have access to such a vast collection of freight data, Xeneta's Rate Management Team are some of the first analysts to see emerging patterns in the freight market worldwide. The team internally coordinates on how to handle new surcharges and pricing changes arising from the consolidation of market players and global events.
In this sea of data, among all the minute details of the shipping industry, the Rate Management Team still finds the time to help potential customers of Xeneta understand the benefits of the platform.
For instance, in onboarding new customers, the Rate Management Team reaches out to customer contacts and asks some basic questions about their freight rates. By establishing a dialogue early, the Rate Management Team can begin to understand the complexities specific to each customer and help them get the most out of their freight rates in the Xeneta platform.
Similarly, one step earlier in the customer journey, the Rate Management Team creates value assessments — personalized reports from Xeneta based on a small set of freight data — so that potential customers can be confident that they're receiving business value before committing to the platform.
And so, for Xeneta, whose entire operations revolve around freight market data, the Rate Management Team is the beating heart of the organization. Without a constant stream of quality freight data coming in, the other departments couldn’t function at their full capacity.