Built to Last? The Changing Role of Ocean Transportation Intermediaries: Disintermediation and Reintermediation

Abstract

Ocean Transportation Intermediaries (OTIs) are either Ocean Freight Forwarders or Non-Vessel Operating Common Carriers as defined and regulated by the U.S. Federal Maritime Commission.  The long standing business model of these entities is changing due to major changes in the liner shipping industry and increased investment and disbursement of technology that poses new challenges and opportunities.  Continued viability for OTI providers, clustered in key global freight procurement locations, will require an understanding of major strengths and weaknesses as well continued investment in management tools and processes that allow them to continue in their historic role as a key conduit in the global movement of freight. We show that despite the growing use of information technology OTIs locate in clusters near ocean and air ports. This points to something else besides IT and analytics which these firms require. We believe that coordination requires more than IT enhancements, and involves close physical contact with partners implying that OTIs will continue to cluster around ports.