Hey friends,

I've worked operations. I've worked procurement. I'm now in sales. I've seen this business from different angles—the side that executes, the side that buys, and the side that sells.

And here's what I know: ship agency as we've known it for decades is dying.

Not slowly. Not eventually. It's happening now.

The question isn't whether the industry will change. It's whether your agency—or your role within it—will still exist in five years.

Shipping lines are cutting costs everywhere. Post-COVID profitability has collapsed. Overcapacity is crushing freight rates. And when shipping lines hurt, they look at their vendor spend and ask one simple question:

"What are we actually paying for?"

For years, the answer was obvious. Ship agents handled port calls. They coordinated services. They managed paperwork. They were the local presence shipping lines couldn't afford to build themselves.

But that value proposition is eroding fast.

Digital platforms now automate what agents used to do manually. Port call optimization software handles scheduling. Electronic documentation eliminates paper trails. Real-time data sharing reduces the need for a human intermediary to relay information between ship, port, and service providers.

According to a 2020 UNCTAD analysis, digital data sharing and collaboration could challenge the power of the ship agent as the primary information hub for all involved in a port call and may be interpreted as a force reducing the value proposition in the ship agent's business concept.

Translation: if your value is being the middleman who forwards emails and makes phone calls, you're replaceable.

The shipping agency services market was valued at $338.2 billion in 2022, but here's the catch: the evolving technological landscape may significantly impact the overall shipping agency services market dynamics over the next ten years. Automation, digital platforms, and blockchain technology are changing how shipping operations are managed and coordinated, posing challenges to traditional shipping agency services as they face competition from more tech-savvy alternatives.

Let that sink in. The market is massive. But technology is eating it from the inside.

When I started in operations, the agent's job was clear: make the port call happen. Coordinate the pilot. Arrange the berth. Handle customs. Manage crew changes. Invoice everything.

Repeat.

It worked because shipping lines didn't have local expertise. They needed boots on the ground. They needed relationships with port authorities, service providers, and regulators. The agent was the fixer.

But here's the shift: shipping lines don't just want execution anymore. They want optimization.

They want to know:

If your answer is "I'll forward your request to the port," you're not adding value. You're adding delay.

I've seen this firsthand in procurement. When I evaluate ship agents, I'm not just looking at who can "do the job." Everyone can do the job. I'm looking at who can improve the outcome.

The agents who survive aren't the ones who execute tasks. They're the ones who solve problems I didn't even know I had.

The middle ground is disappearing. In five years, there will be two types of ship agents left:

These agencies compete purely on price. They handle high volumes of routine port calls with minimal margin. They're efficient, lean, and commodity-focused.

Think of them as the Ryanair of ship agency. No frills. Just execution. If the task is standardized and predictable, they'll do it cheaper than anyone else.

The catch? Brutal margins. High churn. No pricing power. And constant pressure to cut costs further because the only thing differentiating them is the invoice total.

This model works—but only at scale. If you're a small or mid-sized agency trying to compete on price, you'll get squeezed out by larger players with better systems and lower overhead.

These agencies charge a premium because they don't just execute—they advise.

They know the port better than anyone. They have relationships that matter. They proactively identify cost savings. They flag operational risks before they become problems. They don't wait for instructions; they anticipate needs.

When a shipping line calls them, it's not to ask "Can you arrange X?" It's to ask "What should we do about Y?"

That's a completely different value proposition. And it's one that technology can't easily replicate.

These agents survive because they offer something digital platforms don't: judgment, context, and trust.

Let's be clear: digitalization isn't going to eliminate ship agents. But it will eliminate mediocre ship agents.

Here's what technology does well:

All of this is table stakes now. If you're not digitally competent, you're already behind.

But here's what technology doesn't do well:

That gap—between what can be automated and what requires human expertise—is where the future of ship agency lives.

The agents who thrive will be the ones who use technology to handle the routine so they can focus on the complex.

Shipping lines are under immense cost pressure. McKinsey research shows that container shipping has come through five highly volatile and unprofitable years, but remains in poor health. Shipping companies must not give up in the face of market adversity.

When profitability collapses, procurement teams get aggressive. I know. I've been that procurement team.

And here's what we look for when evaluating agents:

1. Are you delivering measurable value beyond task execution?
If I can't quantify what you bring to the table, you're just a line item to optimize.

2. Can you demonstrate cost savings or operational improvements?
Show me the data. "We have good relationships" isn't enough.

3. Are you proactive or reactive?
If I have to tell you what to do every time, I don't need you. I need someone who sees problems before I do.

4. Do you understand our business, or just your process?
The best agents know my pain points. They understand my KPIs. They align their service to my goals, not just their SOP.

The agents who can't answer these questions confidently? They're getting replaced.

If you're a ship agent, ask yourself honestly:

What would happen if your biggest client implemented a digital platform tomorrow that handled 80% of what you currently do?

Would they still need you? And if so, for what?

If your answer is "I'm not sure," you have work to do.

Here's the hard truth: you can't compete on price alone unless you have massive scale. And you can't compete on relationships alone if those relationships don't deliver tangible results.

The path forward is clear:

Become indispensable by being irreplaceable.

That means:

If you can do that, you're not just a service provider. You're a strategic partner.

And strategic partners don't get commoditized.

If you're on the procurement side (like I was), here's what to demand:

Stop accepting "we'll handle it" as an answer.

Push your agents to deliver insights, not just updates. Ask them:

The agents who can't answer those questions? Find new ones.

The agents who can? Pay them what they're worth. Because good agents save you far more than they cost.

Ship agency isn't disappearing. But ship agency as a commodity service—where the only question is "How much?"—is dying.

The future belongs to agents who add strategic value. Who use technology as a tool, not a threat. Who understand that their clients don't just need tasks done—they need problems solved.

I've seen both sides. I've been the agent executing the work. I've been the buyer evaluating the value. And I'm now on the commercial side, building relationships that matter.

Here's what I know for certain:

The agents who adapt will thrive. The agents who don't will disappear.

The question is: which one are you?

Cheers,

Fernando

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