WFN Zoom Workshop
WFN members discussed some relevant problem areas within the logistics industry in their most recent Zoom gathering.
Samad Anwar of Modern Shipping Agencies in Pakistan raised a question to his fellow members, “I would like to raise a topic to discuss how to resolve global containers shortage, and during this time how can we buy good containers at the best price at desired locations?”
It seems to be a global problem, with Wayne from HCC in Australia saying, “We can see the evidence of the container problem. Here in Australia we have a huge amount of empty containers at the ports. So we have the opposite problem, with too much equipment just sitting in Australia. During this pandemic, we have had to diversify as a company. We advertise on Google Ads online. We also use a state-of-the-art digital system, Cargowise. This helps us to work paperless, and enables us to work remotely from home.”
The problem with equipment shortage has affected many of our members, causing sky high prices and endless surcharges.
Aidan from LinC Freight Management in the UK tells us, “We are finding it increasingly frustrating with the unstable rates we are having to pay to a shipping line per container, ex China to Felixstowe. I currently have contracts in place with my customers that I must honour, so each shipment is performed at a loss. The shipping lines are holding us to ransom; as freight forwarders it is important to keep our customers so, for now, surviving in the current market is tough. If you are a blue chip company and moving thousands of containers per month, your rate is good. We smaller freight forwarders, even though we still move hundreds and hundreds of containers, are having to pay a premium price. We are told it is surcharges, and lack of equipment. But are the shipping lines not bringing equipment back because it suits them right now?.”
Sander of SILCO Worldwide in the Netherlands added, “It is true, the shipping lines are charging very high rates. I do not think it is lack of equipment, rather a re-positioning problem. The equipment is there, but the lines are currently making a huge profit out of this situation.”
It seems the carriers will offer the best deals to the huge blue chip companies. Shipping lines have reportedly been incredibly busy, with record profits expected for 2020. So where does this leave the smaller freight forwarders?
Simone from Moz Logistics in Mozambique shared her thoughts on the challenges they are facing: “Shipping Lines are increasingly trying to push the freight forwarder out of the equation. We are now requested to supply full contact details of our customers (shipper/consignee). Shipping lines are then contacting the client directly with updates via an automated system. If a problem arises, there is no-one to speak to. Small and medium size freight forwarders pride themselves on customer care, and these actions are undermining our companies and putting our futures at risk. Damco are enticing clients away with a one stop approach. With Maersk there are often delays, the service is not personal and they are showing the client prices. They hold small companies to ransom. With South and Central Africa, some routes are better than others and the freight forwarder is an integral part of offering country specification. It is becoming more important to offer a digital service to keep up with the big companies.”
It is apparent that this year has thrown some difficult challenges at our forwarding industry. While some companies have thrived, others have needed to diversify in order to survive.
Brian of Customs Services in Zimbabwe has needed to do just this, diversify in order to continue growing. He tells us, “Here in Zimbabwe we already have an unstable economy, and problems with obtaining currency within the country. With the added pressures since the Pandemic, we have had to diversify. We used to sub-contract our trucking. We have now purchased our own vehicles and this is working well. It gives us another avenue to make money. We are also looking to work in more stable countries in Africa, expanding our services and office locations, while also giving us another base outside of Zimbabwe and the government related obstacles.”
While we do not have a definitive conclusion to solve the current issues raised by our members, what we know for certain is that we have a network of freight forwarders that will go that extra mile to satisfy their customers’ needs. They will overcome obstacles and emerge from the Pandemic stronger, more determined, and as professional and efficient as ever.
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