Exclusive interview to Alexander Varvarenko, founder of Varamar and CEO of Shipnext.
Alexander Varvarenko is one of the main actors in shipping, as a founder of Varamar, the Carrier of breakbulk and dry-bulk cargo, and now also for his role in the digitalization of transportation in general, and shipping in particular.
Mr. Varvarenko, until a few years ago, when digitalization was starting,it seemed that it was only for containers. The fact that you founded Shipnext shows that it’s spreading in every logistics field. Do you agree?
Each company is different in its approach and business-case in transportation. There are trading companies that own their own fleet, forwarding companies that work with containerized and non-containerized transport, agency companies that are active in brokering, shippers with or without in-house transport divisions. This is why digitalizing transportation industry is so complex.
And yet, some basic principles should be taken into consideration, which were always important for Shipnext and on which the platform is based:
- The main objective of shipping and transport is to provide efficient and safe delivery of cargo. Cargo comes in all shapes and forms. Packed or bulk. Container is just one the many types of cargo. Container only serves as cargo when shipped empty.
- Maritime transportation (shipping) is ok key important in international transportation. 82% of international trade is covered by Sea, the rest by land, air and pipes. Only 20+% of cargo is containerized, the rest is shipped in bulk/breakbulk. Many cargoes are never containerized.
- The key players in transportation are fleet owners, carriers, forwarders, freight-brokers, traders, shippers/receivers. They all have different ways of interacting and participating in transportation, and to do that they can either employ inhouse/internal specialists (shipping managers, heads of transportation, chartering managers, etc), or external specialists – brokers.This concept is very similar to the legal industry.This is why we at Shipnext consider limiting one’s company to containerized cargo only, or building a digital solution for international transportation as a short-sighted strategy.
Talking about small and medium businesses, how will digitalization help them grow?
Small and Medium-size forwarding and agency companies feel immense pressure from their rivals with greater international coverage. With shipping sector in particular, and transportation industry in general being a global market, with roundthe- clock work, with over 110 countries taking an active role in maritime transportation, keeping track of all the necessary data and providing international coverage to customers becomes problematic.
Larger companies can afford to build up international teams, global presence, 24/7 coverage, flexibility on the types of trades and sectors, and, most importantly – to invest larger amount of money.
Over the last 5-6 years some of the companies have invested millions, and in some cases hundreds of millions of dollars in the digital solutions that were aimed on process-automation, digital documentation-flow, internal and external communication, and supply-chain management.
Investing in building a solution for individual use has not been so successful for many, though. And yet many cases are finding their place on the market. Large forwarding companies and Shipping Agencies have launched their platforms with the aim of targeting their existing and potential customers.
Smaller and Medium-size companies cannot afford to spend or invest at such pace.
And they don’t have to. But what they can certainly benefit from is being faster in adopting existing SaaS (software as a service) solutions, as early adaptors. A relatively small investment can help them become more efficient, flexible in covering different trades, scalable and successful.
Being part of an international network also helps, as lost as the network helps consolidate efforts to in helping their members achieve their goals and remain competitive.
In few words can you describe how Shipnext works?
Shipnext was created to help transform the shipping sector in general, and the transportation industry in general. With the shift of the industry from telex and fax onto email in the 90s, the work ever since has not changed much. Emails continue to play the dominant role in how information, freights, trade is exchanged between millions of managers involved in global trade and transportation. 80+% of transportation companies still do their daily business through Outlook.
With messengers the problem has become worse, and critical data/information is scattered as never before.
Shipnext patented the process of bringing the transportation industry from emails onto a platform-based communication and trade. In particular the process of decrypting emails, messages and other shipping-related information for the purpose of extracting cargo and fleet-related data for instant freight-matching (cargo-to-ship, ship-to-cargo).
The key solutions and tools that Shipnext offers include:
- Instant cargo-to-ship and ship-to-cargo matching
- Freight search and Freight negotiations (tendering)
- Chat/Emailing/Tagging for Internal and external communication
- Cargo tracking
- Fleet search and compliance checks
- Freight calculations
- Port data (including restrictions, facilities, suppliers/agents, congestion, weather, etc)
- Contract Management
- Analytics, Data-management and process automation
- Internal collaboration and networking
Shipnext, ALN and ALNA made an agreement with you and all their members have one-year free access to your platform. How do you think digitalization is changing logistics in Africa?
Our cooperation with ALN and ALNA is related to our strategy in helping companies have a better and faster access to international shipping data. We believe that a lot of our solutions could help create customized solutions with small additional investment. Customizing a digital solution and automating
routine work-flows inside a company or group of companies has never been as easy as it is with Shipnext.
Having said this, Shipnext gives a powerful tool to any shipping professional irrespective of his place of business to be strong, efficient, flexible and successful in global trades and international transportation. This should open up new opportunities for remote teams in particular and companies located in
Africa in general to be part of an efficient ecosystem on Shipnext.
Thank you Mr. Alexander Varvarenko for your precious time.
For more information, please visit Shipnext