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November 23, 1998

Launch For E-Commerce

Ocean shippers move from EDI to the Web

By Gregory Dalton

he ocean shipping industry relies heavily on electronic data interchange to communicate orders and logistics electronically. But the industry is gradually turning to the Web for certain business functions in order to take advantage of the Internet's simplicity and universal access.

Sea Land Service Inc., the world's largest shipping company, started accepting orders on its Web site earlier this year. Next year, it will introduce a system in the United States that will let truckers avoid long lines at distribution centers by going to a Sea Land Web site to reserve a time to pick up their cargo.

"Every single function we have, we have to see if the Internet would be useful," says Sea Land VP of IS Jim Watkins. But Watkins is wary of rushing too many business processes to the Web because EDI is working fine in many cases.

Manufacturers that send cargo via shipping lines see opportunities in the Internet. "We were always betting that [EDI] was the horse we were going to ride," says Don Cameron, manager of trade policies at Bose Corp. in Framingham, Mass. "The Internet is much, much better." Cameron says he'd like to use the Internet to receive information from a network of shippers and other carriers on a regular basis.

But the absence of a common document format on the Web is keeping manufacturers from moving more quickly. Mark Nagle, manager of delivery systems at Procter & Gamble, says it would be "a training nightmare" to teach employees to enter orders into the Web sites of the dozens of transportation companies Procter & Gamble deals with.

One factor steering the industry to the Web is deregulation. The Ocean Shipping Reform Act of 1998 was passed last month and takes effect next May. It requires shipping companies to post some prices on the Internet rather than file them on paper with the Federal Maritime Commission. That may, in turn, foster greater use of the Internet.

With prices for transporting cargo around the world posted on the Web, entrepreneurs such as Browning Rockwell, CEO of TradeCompass, an Internet-based trade and logistics company, are considering how to tie that information to other systems to provide functions such as clearing customs. "That opens up a whole new way of doing business," he says. "It's going to open E-commerce opportunities."

Photo by J. Wes Bobbit