Still no sign of a peak season, and volatile fuel prices add to the pressure on carriers
Deepsea container shipping freight rates on the Asia-Europe trades this week again showed that the ...
A new portal, developed by US retailer Walmart with freight forwarder Expeditors to deliver forecasted shipping volumes on a rolling basis to its container carriers, has brought a 10% improvement in on-time delivery of cargo.
At this week’s Transpacific Maritime conference in Long Beach, Michelle Weaver, Expeditors’ senior vice president of global order management, said the portal, five years in development, had “improved the partnership between shipper and carrier”.
“A lot of importers and exporters struggle with accurate volume forecasting. “But with this system, pricing has improved, access to capacity is better and there has been no rolled cargo for Walmart since it went live,” she said.
Walmart’s logistics team enters all its purchase orders into the system: origin and destination information, shipment date and container volume; and each purchase order is assigned a specific sailing 14 weeks before vessel departure.
Once the carrier has confirmed the booking, and after exceptions have been dealt with, the information is released to the freight forwarder three weeks before sailing.
“The beauty of this process is that it allows shippers to address any capacity constraints six-to-eight weeks before shipment, and it gives us flexibility in terms of booking drayage and labour at the destination,” Ms Weaver said.
It has also greatly improved Walmart’s back office efficiency, added Anthony McAuley, director of global logistics for Walmart Stores.
“The manual forecasting process that took place before this system was sucking up so much time,” he said. Volume forecasting that previously took his team up to four days, was now down to a couple of hours.
Once carrier that has benefited from the improved forecasts is CMA CGM. Mathieu Friedberg, its senior vice president of commercial and agency network, said: “Anything that helps cure the industry of one of the major diseases of our industry is welcomed.
“There is a real issue in this industry of rebuilding trust and this demonstrates a real level of of commitment to forecasting correctly. Some customers have been over-forecasting volumes by as much as 40-45%.
“Depending on the trade and nature of the business, fewer than half our customers are forecasting at all, and less than half of them are doing it correctly,” he said.
The Loadstar’s coverage of TPM 2019 is sponsored by Kontainers.