GE Information Services and Data Exchange International face a challenging and difficult task in their new tariff-automation venture.
Automating the process by which ship lines determine exactly how much should be charged for moving goods has proven a far tougher task than many in the industry expected, maritime executives said."Everyone in the business now realizes how complicated a process that is," said Richard D. Marks a partner in the Washington, D.C.-based law firm of Dow, Lohnes & Albertson. The firm represents the Asia North America Eastbound Rate Agreement conference.
Many companies have tried to break into the business and failed, noted Peter Cass, president of Transax/Data, a subsidiary of The Journal of Commerce Inc. and one of the few companies in the tariff-automation business.
Ship lines want programs designed that will help them do business more efficiently, but not dramatically change the way they do business, Mr. Cass said.
Executives with DXI and GEIS agree that they have a difficult task ahead. But the companies already have met most of the challenges they'll face, the executives said.
Tariffs are documents that combine mathematical formulas with sets of rules and regulations to determine what shippers are charged.
"If you begin the automation project from the tariff itself you will find it very difficult to automate," said Bob Ryan, president of Pittsburgh-based DXI.
"What we've done . . . is to look at the actual movement of cargo and reconstruct the tariff from there," Mr. Ryan said.
Doing this has enabled DXI to create a system that quickly and easily allows ship lines to calculate "bottom line" rates, Mr. Ryan said.
''DXI, through GE, will be offering a tariff and documention automation system which will deliver the abilty to do bottom line rating for bills of lading," Mr. Ryan said.
DXI's service is called Ratemaster. It is being offered thorough GEIS' Cargo Link electronic communications service, which is aimed specifically at the transportation industry.
GEIS is a Rockville, Md.-based subsidiary of General Electric Co.
"In the traditional tariff process, you look at a tariff page and you determine a specific commodity bears a specific rate - but on that given page you don't have the abilty to see all of the accessorial charges that effect that given rate," Mr. Ryan said.
Accessorial charges are fees lines charge for doing things other than just moving goods. They account for most ship line profits. DXI's system helps automate calculation and charging of these fees, Mr. Ryan said.
DXI has garnered legitimacy in the maritime marketplace through its participation in the Federal Maritime Commission's Automated Tariff Filing Information project. That project has started to generate some controversy, and maritime executives said the conflict may have an impact on the GEIS-DXI effort.
"Rightly or wrongly, I think some people are looking at DXI, and taking the view that they may be a culprit in the ATFI system's perceived shortcomings," Mr. Marks said.