Recent survey from the Drewry highlights
the problem of the current market
The whitepaper co-produced by Drewry and Cyberlogitec tackles the problem of the current ocean freight market. In the meantime, the results of recent survey by Drewry provides another evidence of the problem of the current ocean freight market.
The survey is done by the European shippers mainly, especially which has their office in the European continent. About 200 shippers participated in this survey, and about 50% of the surveyee replied. The surveyee are participating in the global trade not only regional or intra trade.
<Figure1. Shipper's satisfaction against carrier service and cost>
(data provided by Drewry, reproduced by Cyberlogitec, 2019)
Figure 1 shows the result of survey reproduced by Freight9 project team. The original survey contains multiple questions to identify the shipper’s opinion on the current market. Mainly, Figure 1 shows the differences between the hierarchy of the carrier’s criteria to their service and the cost under the shipper’s perspective and their experience on the criteria in 2018. Therefore, negative figure denotes the degree of the shipper’s unsatisfaction, positive figure means the degree of the shipper’s satisfaction.
What is the shipper’s voice to the current market?
Seven criteria were identified from the survey that the shipper was not satisfied in 2018. Among them, some criteria such as “reliability of booking/cargo shipped as booked”, “transit times”, “clarity of surcharges” and “price of service” which include transparency-related-keyword “reliability, clarity” were chosen. As the shipper picked most important criteria as “Availability of cargo space” and “Price of service” from the original results which is not provided in the article, it is clear that the carrier is doing their best for the customer satisfaction but not for the all area such as “reliability, clarity” related area. On the other hand, the shipper chose that they feel more comfortable relatively with “financial status”, “accuracy of documentation”, “quality of equipment” and “green policy”. The main keyword related to these criteria is “resource”.
In a summary, the shipper requires more transparent and reliable process from the market, whereas they assessed the physical service of the market(resources) are good. The survey includes only shipper’s voice to the market, therefore this article does not deny the biasness of the voice to the shipper. Instead, another practical feedback from the freight seller side will enlighten more comprehensive approach to the problem of the market.
Reliable market with the more clarity and transparency
The requirement from the shipper shown in the survey is not the recent issue. Fundamental characteristic of the ocean freight industry encouraged the carrier to focus more on the cost management. Moreover, the capital-intensive characteristic also encouraged the carrier to the more conservative management. Recently, the development of new technology enables the carrier to solve some of their chronic trouble. Introducing IT technology such as ERP(Enterprise Resource Planning) system to the maritime industry enabled the carrier can manage their resource such as fleet, equipment, financial resource more efficiently. At the same time, technological development enabled to build more cost efficient vessel with less fuel consumption and economies of scale boosted the carrier able to satisfy their customer as the survey results showed the shipper satisfied most in “financial status”, “accuracy of documentation”, “quality of equipment” and “green policy”.
In many cases, the technological advance was settled to the industry with the supporting of the policy. Recent technological development in the logistics fields invited large amount of investment to the numerous logistics IT start-up. At the same time, inter-governmental organization such as UN-CEFACT, IMO are now active to set up a advanced process to accept the digitalization trend. Those circumstance is generating more advanced ocean logistics environment. Except the ocean sector, land and air sector are far more advanced as we can see the cases of Amazon and Amadeus. The facts are the background why the shipper feels especially “unreliable” and “foggy” to the current ocean freight market.
In a summary, the shipper requires more transparent and reliable process from the market, whereas they assessed the physical service of the market(resources) are good. As the “reliability” and “transparency” is the hot potato in the logistics industry, and as we can see transparency from the other industry, it is clear that the shipper’s requirements will be continued. Therefore, we can see it is right timing for achieving the advanced ocean freight market. The survey in this article includes only shipper’s voice to the market, therefore this article does not deny the biasness of the voice to the shipper. Instead, another practical feedback from the freight seller side will enlighten more comprehensive approach to the problem of the market.
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