Consolidation and technology: the future of international moving

Jan 05 | 2020

Ian Waters, OMNI General Manager (Overseas Moving Network International), comments on the state of the international moving industry and what will enable the industry to thrive in the future.

Ian Waters, OMNI General Manager

The moving industry has changed.  Shipments are getting smaller, customers are becoming more demanding and the Internet is allowing price comparisons as never before.  The old days of lucrative corporate relocation contracts are waning in favour of ‘Lump Sum’ customers and RMC masters.  Now, more than ever, international moving companies are having to review their methods of getting business and strive for greater efficiency to remain competitive.  

It’s easy to imagine that we have arrived at some ‘new normal’: a permanent state.  But as John Lennon once said: “Everything will be okay in the end … and if it’s not okay, it’s not the end.”  We are in a state of permanent transit, and this is just the latest phase.  Just as it did in the past, the market will change again.  That’s the thrill of being in business: trying to second-guess what might happen next, and being there first.

The baby boomer generation has fuelled industry for the last 70 years. As the birth rate rose following the second world war, so businesses developed to meet the new need.  Babies grew into adults and, with their self-fuelled wealth and improving technology, they travelled, cooperated and built a new world of global commerce that required nurturing and maintaining.  Today, the baby boomers are stepping back and the new generations, with different aspirations and values, are taking their place.

Today’s customers live in a different world than their predecessors. It’s technology driven, more educated, more inclusive and, in many ways, better than the one into which their parents were born. But today’s people, having experienced a youth of plenty, are now not so bothered by material things.  No longer is there a need to travel for business; locals can do the job just as well.  No, now they travel for fun, for experience, for cultural development and demand that their employers give them the opportunities they crave.  But travelling the world accompanied by their worldly goods? Well, not really.  Now they live and travel light.

That means the moving industry needs to reshape itself to provide the services the next generation wants.  To a large extent it’s already doing so.  Ever since the Internet transformed all our lives, the industry has been advancing in ways that have become commonplace today.  Simple things such as e-mailing quotations and communicating with customers by text have become the norm.  Now video surveys, online quoting, shipment tracking, promoting through social media and many more technological advancements have made sure that the moving industry is as tech savvy as any other. But I believe we have only seen the start: there’s much more to come.

In recent years we have also seen significant consolidation with mergers and acquisitions changing forever some of the biggest names in our industry: Pickfords, Sterling, Suddath, Gerson, Abels, Packimpex, Stuttafords – all names that are still with us but have lost their independence to some extent.  There will be more and, with that consolidation will come the opportunity for greater efficiency, reduced costs, more investment and greater public awareness as time and expertise can be funnelled into exploiting new routes to market more than ever before.

Smaller companies too have opportunities.  They might not be able to compete with the conglomerates for mass business, but they can specialise.  Already some smaller companies are identifying niche markets and becoming very good at serving them.  Technology will, of course, not leave them behind: they will need to be as sharp as anyone in that regard.  Sadly, there will be losers and it is likely to be the mid-sized companies that find it hardest to get by: those without the economies of scale of the large companies but still with assets and overheads that need constant feeding.

Interestingly, although technology and customer expectations put constant pressure on established companies, it can also work in their favour. It was always said that the cost of entry into the moving market was small, so there was always someone waiting to take your place.  That’s probably still true, but as getting clients becomes more difficult, as regulation becomes more onerous, as the levels of customer service expected becomes more individual, and as the technology employed by the best companies becomes increasingly advanced, simple entry is unlikely to continue other than at the absolute ground level. Customers today find it easy to compare services, in future it’s likely to be even easier, and if you are not on top of that five-star listing, you are nowhere.  That’s difficult for new entrants.

There is a new development that might raise the bar again. In Chicago in October, IAM (International Association of Movers) hosted a meeting to explore the opportunities that technology can offer to the industry.  Ideas that seem to be fantasy, in which the whole of the international moving industry and its associated players – shipping lines, port authorities, customs, insurance companies, etc. – are linked together in an unbreakable and unhackable chain of communication, are potentially real.  OMNI has already pledged its support to help IAM and FIDI work together to develop the Standards that will allow this dream to become a reality.  As the pace of change continues to accelerate, this particular piece of science fiction may not be far away.  When it happens, it will be a sea change for the industry, locking in the major operators into a network of accuracy and efficiency that will be impossible to penetrate by upstarts and, potentially, providing the economies needed to renew profitability.

Prophesying the future is impossible; many have tried, and all have failed.  But I do believe that, rather than standing on a precipice, the moving industry is poised on the brink of fundamental change that will return its profitability and rejuvenate its excitement for the new generation of entrepreneurs.  However much technology dominates our lives, the wanderlust that has driven humans to extraordinary endeavour over centuries will not be diminished by time.  So, whatever the future may hold, the moving industry will thrive.  The question is, will you be part of it? 

Photo:  Ian Waters, OMNI General Manager

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