Squeeze Play.

Dot-coms and new logistics chase forwarders backward.

MOVING GOODS USED TO BE A SIMPLE AFFAIR. IF YOU were a big shipper, you negotiated choice contracts with big carriers. Smaller guys--well, they scurried for space and service, using forwarders, consolidators and other go-betweens.

Not anymore, now the once-established lines of which companies handle what cargo--and how--are becoming blurred. "It's like the Wild West out there," says Rey Ortiz; DuPont's head of procurement. With big carriers and forwarders no longer calling all the shots, Ortiz predicts: "The future's going to wind up being Internet and high tech."

If, for example, you are a customer of chemical manufacturer E.I. du Pont de Nemours & Co., one of the biggest shippers and investors in Latin America, you can plug into that shipper's new logistics arm, which is handling the shipping of other companies' goods. Agricultural products can be moved to Latin America--or any other region--at Horsepower.com, a trade and auction electronic marketplace, while a host of Web sites offer different modes of transportation, such as Tradiant.com for shipping and Rightfreight.com for airfreight.

The Internet has lured a few top guns from key logistics companies and carriers. David Beatson left worldwide logistics leader Circle Transportation to become a dot-com executive at an Internet logistics company. John Urban, who started Latin American services for shipping line APL and grew it into a $150 million business, left that executive position to become chief executive officer at Tradiant.com the shipping line logistics provider.

John F. Maldonado, who built the Latin America business for United Parcel Service, joined the growing ranks of UPS and Federal Express executives who moved into dot-com hierarchies; Maldonado left UPS this year to manage logistics for Fiera.com, which offers logistic services for electronic retailers in Latin America." UPS was not--and really still is not--prepared to really enter Latin America," Maldonado says.

For a company that is "unprepared," UPS is throwing around a lot of weight. Richard Camejo, international vice president of the Americas region for UPS, points at the Challenge Air acquisition that has transformed the company into a regional airfreight powerhouse, and indicates that the express cargo company has even more investments planned for the region.

Nonetheless, the dot-coms are putting increasing pressure on forwarders to either reinvent themselves or think about another line of work. "Forwarders today have already fallen behind," says Leon Falic, head of From2.com, which moves computers, parts and other electronics, mostly to Latin America from the United States.

One step back. Forwarders often take too long to take care of the fundamentals, like making sure the documentation's correct, Falic says. By comparison, users of From2.com have everything, from documentation to rate quotes, taken care of up front.

Forwarders counter that not only do they get the fundamentals correct, they offer, a personal touch--with years of experience and people on the ground in the region, representatives who know a market's special nuances that will help clear the cargo and get it to the right destination in a timely manner.

But thanks to the Internet and accompanying special software packages, it's more than just a shipper's choice about who will handle the cargo--and how it will be handled, stored, inventoried, processed and managed. Not only is Internet shipping available with the click of a mouse, it's as transparent as plastic wrap.

Importers, exporters and manufacturers have complained for years that they felt their cargo disappeared into a black hole once it left their back doors. Duties, tariffs and cargo location were hard to pin down. But the software and services now offered by dot-coms let companies keep tabs on their cargo and costs through the entire process.

That's one of the key selling points for shippers' Internet groups like Horsepower.com. "Before, farmers would put their products on the back of a truck, say goodbye, and wait for the check," says company spokesman Steve Griffiths. "Now, we have something that keeps track of everything, from field to end user." And if the dot-coms can add the right price, on-time delivery and reliable service to the equation, they just might give the forwarders a run for their money.