OneMarket is the first cloud-based exchange for freight forwarders and shippers to trade ocean container space and maximize their revenues.
Most LCL ("Less-than-Container Load") containers are shipped 20% to 40% empty, and while the industry targets a utilization rate of 83%, the average rate is 67%. Onemarket’s platform connects shippers with buyers who bid on this excess space, in a market with $5.2 billion in potential trading fees.
The forwarding business is currently run via fax, phone and email, yet is recovers approximately $15 billion in lost revenues each year. Most buyers are required to undergo credit checks, yet it’s still common for collections to take up to 6 months. Meanwhile, there is no centralized source for pricing, so quotes can take days to receive. In addition, 20% of shipments have documentation problems due to the manual paper processing and fax technology.
OneMarket believes that only an online exchange can resolve these kinds of market inefficiencies in the shipping industry. The online platform would instantly reach thousands of buyers, while its clearinghouse would guarantee on-time payments in full. Quotes would be provided swiftly on a trading platform that OneMarket is also developing.
Ultimately, OneMarket wants to transform the industry’s analog systems to digital and eliminate redundant back-office labor.
Specialized US freight forwarders, known as NVOCCs, control the supply of containers and drive rates & practices down to the rest of the forwarder market. The top 50 NVOCCs control 83% of the market and OneMarket is targeting the rest. If successful, OneMarket sees applications for the overall transportation market, including FCL ("Full-Container Loads") Shipping, Trucking and Rail.