<div class="phx-topic abstract-wrapper">Negotiations for 2019-2020 shipping contracts will be difficult on a number of fronts.</div>

Negotiations for 2019-2020 shipping contracts will be difficult on a number of fronts.

<div>The start of 2019 is sending signals that we may have slower trade growth than anticipated, presenting challenges to all. The National Retail Federation says it expects <a>a decline in year-over-year growth</a>, and the World Bank is sending signals that the global economy is slowing, with China leading the way.This isn’t great news for any sector of global trade. Carriers are already smarting from a less-than-spectacular 2018 and face increased capacity being delivered in 2019. Shippers, some of whom felt the sting of unusually high spot market rates during the last couple of months of 2018, face what could be...

The start of 2019 is sending signals that we may have slower trade growth than anticipated, presenting challenges to all. The National Retail Federation says it expects a decline in year-over-year growth , and the World Bank is sending signals that the global economy is slowing, with China leading the way. This isn’t great news for any sector of global trade. Carriers are already smarting from a less-than-spectacular 2018 and face increased capacity being delivered in 2019. Shippers, some of whom felt the sting of unusually high spot market rates during the last couple of months of 2018, face what could be increased tariffs after March 1 when the US and China end their trade talks. Carriers also are seeking increased rates and anticipate a jump in fuel costs related to the International Maritime Organization’s (IMO’s) low-sulfur fuel mandate that will take effect Jan. 1, 2020. Balancing these conditions will be a challenge to all involved in ocean shipping, with shippers and carriers working on plans to keep their economic equilibrium, trying to meet budgets most set months ago before the unfavorable news of recent events. Some of the drama started playing out in December as carriers met with larger shippers to begin the 2019-2020 contract negotiations . Carriers must get back on track to make money as they did in 2017 after six years of losses, having failed to do so in 2018 because of decisions made early in the year, decisions that will impact them through April. By managing capacity, they were able to recover a bit in the spot market late in 2018. Carriers also caught a break with oil prices declining in late 2018. But the larger shippers have a deal in hand lasting almost four more months, and while they recognize conditions better than most, they aren’t in a mood to just accept increases because carriers aren’t making money. So negotiations for the 2019-2020 contracts will be difficult. Carriers were able to get spot rates up by more than double some of the service contract levels. But facing the large service contract shippers who have low rates and asking for increases has never been an easy task for carriers; volumes available seem to bring out a gift-giving reaction. IMO 2020 low-sulfur fuel rule a key concern With the low-sulfur mandate beginning in January 2020 , the new contracts will run four months through April, so whatever is agreed to this year will haunt carriers if they fail to act in the next round of contract talks. Early indications are there may be increases of a relatively modest level, but a fuel surcharge question remains. The thinking is there will be a prolonged negotiating period — nothing new — but with far more volume involved; one strategy may be, “let them see that the ships won’t be full, and they’ll be more reasonable.” None of this is new; conditions of the day regularly alter the issues and outcomes. The basic challenges rarely change. Supply and demand ratios play the largest role in rate levels. Last year, this had a big impact on the spot market, causing wide variances in what shippers paid to move their cargoes. We have 11 months to watch this play out for 2019. The continuing decline in reliability has both shippers and carriers pursuing improved services. Both sides continue to talk about it but do little to correct it. Carriers refuse to increase vessel speeds when well behind in their schedules, and some have pulled sailings with little or no advance notice. Shippers continue to have high levels of no-shows on bookings, with few providing accurate forecasts to carriers on a consistent and timely basis. There are those who genuinely care about and work toward improving their side of the equation, recognizing that they help themselves by being cooperative. Unfortunately, they are in the minority, and a great deal of that relates to who is booking the cargo — the cargo interests or third parties. Many third parties are vigilant and cooperative, but there are hundreds of these entities who attract cargo one way — price. To them, service levels are of little consequence. Issues such as properly declaring what’s in a container to ensure safe stowage to avoid damaging results also isn’t high on their priority list. Look closely at the number of incidents of fires onboard vessels and the real causes. Only time will tell the outcome of the many challenges the industry faces again this year. Gary Ferrulli is CEO of Global Logistics & Transport Consulting. Contact him at gferrulli@globallogisticsandtransport.com .

Container Shipping News

Container challenges of 2019 to echo years past

<div class="phx-topic abstract-wrapper">The journey time, about two to three days better than typical industry metrics, comes despite congestion in other parts of partner CPKC’s network.</div>

The journey time, about two to three days better than typical industry metrics, comes despite congestion in other parts of partner CPKC’s network.

Feature image

<div class="phx-topic">Schneider National said Friday its flagship Mexico Midwest Express (MMX) intermodal service with partner Canadian Pacific Kansas City (CPKC) is continuing to deliver strong results in 2025, offering faster transit times and higher on-time reliability than many cross-border alternatives despite congestion in other parts of CPKC’s network. The MMX service, launched two years ago, connects inland Mexican cities such as Monterrey and San Luis Potosí with Chicago via a single-line rail route. The service bypasses traditional interchange delays at the border, with two spans over the Laredo bridge and switching yards on each side of the border to handle crew changes. While Schneider did not disclose current shipment totals due to its quiet period ahead of the release of its second-quarter earnings, the company said MMX performance metrics through the first half of 2025 were strong, with average transit times of four days and a cargo theft rate of less than 0.02%. Schneider also said the on-time performance of MMX remains above 95%. The typical transit time from Monterrey to Chicago is about six or seven days. “Decreasing shipping time by even a few days matters to our customers because the faster products can get on the shelves, the faster those items can land in the hands of consumers,” Michael Baumgardt, Schneider’s senior vice president of intermodal, said in a statement. The Intermodal Association of North America (IANA) reported that railroads hauled a combined 86,000-plus domestic containers this year through May 31, a 21% increase compared with the same period a year earlier. Railroads hauled nearly 60,000 domestic containers to the Midwest during the same period, up 9% from a year earlier. Schneider is currently the only intermodal provider offering a true single-line cross-border solution from Mexico to the Midwest, eliminating any chance of delays caused by an interchange between two railroads. Schneider said service on the MMX has not deteriorated much since CPKC’s <a href="https://www.joc.com/article/cpkc-acknowledges-service-woes-to-us-regulators-vows-remediation-6030412">messy IT transition</a> in May that affected service in Texas, Louisiana, and Mississippi. The exception is that some shippers have experienced lengthy delays moving cargo from Laredo to Chicago because the container dwell inside the Laredo yard is up 122% since early May compared with a year ago. Schneider rivals <a href="https://www.joc.com/article/jb-hunt-launching-quantum-de-mexico-for-time-sensitive-cross-border-freight-6014579">J.B. Hunt Transport Services</a> and <a href="https://www.joc.com/article/hub-group-boosts-cross-border-business-in-jv-with-mexican-dray-carrier-5745355">Hub Group</a> have also ramped up investments in cross-border intermodal in recent months, introducing new services and partnerships aimed at capturing a growing share of freight moving between the US and Mexico. Union Pacific Railroad completed a pilot program this spring to speed up the handoff between Mexican and US crews by doing it inside UP’s Eagle Pass terminal rather than on the middle of the International Railway Bridge. Contact Ari Ashe at <a href="mailto:ari.ashe@spglobal.com">ari.ashe@spglobal.com</a>.</div>

Schneider National said Friday its flagship Mexico Midwest Express (MMX) intermodal service with partner Canadian Pacific Kansas City (CPKC) is continuing to deliver strong results in 2025, offering faster transit times and higher on-time reliability than many cross-border alternatives despite congestion in other parts of CPKC’s network. The MMX service, launched two years ago, connects inland Mexican cities such as Monterrey and San Luis Potosí with Chicago via a single-line rail route. The service bypasses traditional interchange delays at the border, with two spans over the Laredo bridge and switching yards on each side of the border to handle crew changes. While Schneider did not disclose current shipment totals due to its quiet period ahead of the release of its second-quarter earnings, the company said MMX performance metrics through the first half of 2025 were strong, with average transit times of four days and a cargo theft rate of less than 0.02%. Schneider also said the on-time performance of MMX remains above 95%. The typical transit time from Monterrey to Chicago is about six or seven days. “Decreasing shipping time by even a few days matters to our customers because the faster products can get on the shelves, the faster those items can land in the hands of consumers,” Michael Baumgardt, Schneider’s senior vice president of intermodal, said in a statement. The Intermodal Association of North America (IANA) reported that railroads hauled a combined 86,000-plus domestic containers this year through May 31, a 21% increase compared with the same period a year earlier. Railroads hauled nearly 60,000 domestic containers to the Midwest during the same period, up 9% from a year earlier. Schneider is currently the only intermodal provider offering a true single-line cross-border solution from Mexico to the Midwest, eliminating any chance of delays caused by an interchange between two railroads. Schneider said service on the MMX has not deteriorated much since CPKC’s messy IT transition in May that affected service in Texas, Louisiana, and Mississippi. The exception is that some shippers have experienced lengthy delays moving cargo from Laredo to Chicago because the container dwell inside the Laredo yard is up 122% since early May compared with a year ago. Schneider rivals J.B. Hunt Transport Services and Hub Group have also ramped up investments in cross-border intermodal in recent months, introducing new services and partnerships aimed at capturing a growing share of freight moving between the US and Mexico. Union Pacific Railroad completed a pilot program this spring to speed up the handoff between Mexican and US crews by doing it inside UP’s Eagle Pass terminal rather than on the middle of the International Railway Bridge. Contact Ari Ashe at ari.ashe@spglobal.com .

North-American rail

Intermodal providers

Schneider says MMX service delivering four-day Mexico-Chicago transit time

<div class="phx-topic abstract-wrapper">The project, due to begin Monday, will also improve truck access by upgrading the gate infrastructure and boost efficiency through the replacement of an outdated terminal operating system.</div>

The project, due to begin Monday, will also improve truck access by upgrading the gate infrastructure and boost efficiency through the replacement of an outdated terminal operating system.

<div class="phx-topic">The International Transportation Service (ITS) terminal in Long Beach will begin a $365 million upgrade on Monday that will increase its container capacity by about 50% and enable it to work two 18,000-TEU ships simultaneously. The work involves filling in a 19-acre slip at the terminal to make the property usable. Scheduled for completion in about three and a half years, the project will also improve truck access by upgrading the gate infrastructure and boost efficiency through the replacement of an outdated terminal operating system (TOS) with a new TOS, ITS CEO Kim Holtermand told the Journal of Commerce. “Our tech is quite old. It’s time to upgrade it,” Holtermand said. ITS is, in effect, two separate terminals separated by the slip, which hinders operational efficiency, Holtermand said. Filling in the slip will increase the terminal’s size to 277 acres and create a more efficient square-shaped facility. With a total of 3,500 linear feet of berth, ITS will be able to handle two super-post-Panamax container ships, or one 18,000-TEU vessel and two smaller ships simultaneously, he said. “It will be a large efficient facility with big [super post-Panamax] cranes and improved infrastructure,” Holtermand said. ITS’ annual throughput capacity will increase by about 50% to 1.5 million container moves, or 2.6 million TEUs, he said. <h3>Gate improvements expected to boost efficiency </h3>Included in the project will be a reconfiguration of the terminal’s gate complex and a new TOS that will streamline truck access and egress. Trucks calling at ITS in June had an average turn time of 71 minutes; the average turn time for the Long Beach-Los Angeles port complex in June was 62 minutes, according to the Harbor Trucking Association. ITS will also continue its efforts to electrify all its cargo-handling equipment by 2030 to meet the deadline set in the joint Los Angeles-Long Beach <a href="https://www.joc.com/article/la-lb-port-significantly-cuts-emissions-but-tougher-challenges-await-5742585">Clean Air Action Plan</a>, Holtermand said. The equipment will continue to be operated by dockworkers, he added. Noel Hacegaba, COO at the Port of Long Beach, said the ITS expansion project is the latest example of how the port and its stakeholders are not only growing, but growing green. Another project that will accomplish the port’s environmental goals is the <a href="https://www.joc.com/article/southern-california-ports-ready-to-defend-green-initiatives-from-trump-white-house-5927353">Pier B on-dock railyard</a> that will eliminate hundreds of truck trips each day by loading inland point intermodal (IPI) containers directly onto trains rather than trucking them to near-dock railyards, Hacegaba said. Construction of the Pier B facility continues to advance, he said, with completion expected in 2032. On-dock moves account for about 27% of Long Beach’s IPI volume; completion of the Pier B facility will raise that to about 35%, Hacegaba said. Contact Bill Mongelluzzo at <a href="mailto:bill.mongelluzzo@spglobal.com">bill.mongelluzzo@spglobal.com</a>.</div>

The International Transportation Service (ITS) terminal in Long Beach will begin a $365 million upgrade on Monday that will increase its container capacity by about 50% and enable it to work two 18,000-TEU ships simultaneously. The work involves filling in a 19-acre slip at the terminal to make the property usable. Scheduled for completion in about three and a half years, the project will also improve truck access by upgrading the gate infrastructure and boost efficiency through the replacement of an outdated terminal operating system (TOS) with a new TOS, ITS CEO Kim Holtermand told the Journal of Commerce. “Our tech is quite old. It’s time to upgrade it,” Holtermand said. ITS is, in effect, two separate terminals separated by the slip, which hinders operational efficiency, Holtermand said. Filling in the slip will increase the terminal’s size to 277 acres and create a more efficient square-shaped facility. With a total of 3,500 linear feet of berth, ITS will be able to handle two super-post-Panamax container ships, or one 18,000-TEU vessel and two smaller ships simultaneously, he said. “It will be a large efficient facility with big [super post-Panamax] cranes and improved infrastructure,” Holtermand said. ITS’ annual throughput capacity will increase by about 50% to 1.5 million container moves, or 2.6 million TEUs, he said. Gate improvements expected to boost efficiency Included in the project will be a reconfiguration of the terminal’s gate complex and a new TOS that will streamline truck access and egress. Trucks calling at ITS in June had an average turn time of 71 minutes; the average turn time for the Long Beach-Los Angeles port complex in June was 62 minutes, according to the Harbor Trucking Association. ITS will also continue its efforts to electrify all its cargo-handling equipment by 2030 to meet the deadline set in the joint Los Angeles-Long Beach Clean Air Action Plan , Holtermand said. The equipment will continue to be operated by dockworkers, he added. Noel Hacegaba, COO at the Port of Long Beach, said the ITS expansion project is the latest example of how the port and its stakeholders are not only growing, but growing green. Another project that will accomplish the port’s environmental goals is the Pier B on-dock railyard that will eliminate hundreds of truck trips each day by loading inland point intermodal (IPI) containers directly onto trains rather than trucking them to near-dock railyards, Hacegaba said. Construction of the Pier B facility continues to advance, he said, with completion expected in 2032. On-dock moves account for about 27% of Long Beach’s IPI volume; completion of the Pier B facility will raise that to about 35%, Hacegaba said. Contact Bill Mongelluzzo at bill.mongelluzzo@spglobal.com .

Port News

North American ports

Marine terminals

Maritime

Long Beach ITS terminal upgrade to boost capacity by about 50%

<div class="phx-topic abstract-wrapper">The decline came despite a 4.4% increase in total container volumes to 2 million TEUs, the carrier said in a quarterly update Friday.</div>

The decline came despite a 4.4% increase in total container volumes to 2 million TEUs, the carrier said in a quarterly update Friday.

<div class="phx-topic">OOCL’s second-quarter revenues dropped 6.5% year over year to $2.1 billion amid falling freight rates on trans-Pacific and Asia-Europe services, the carrier said in a quarterly update Friday. The revenue decline came despite a 4.4% increase in total container volumes to 2 million TEUs, the carrier said. OOCL, the liner offshoot of Hong Kong-listed Orient Overseas (International), a Cosco Shipping Holdings subsidiary, said second-quarter trans-Pacific revenues were also hit by a 4.3% fall in container volumes to 501,814 TEUs. Trans-Pacific revenues fell 18% to $753 million in the second quarter from $922 million a year earlier. OOCL said revenue from Asia-Europe services dropped 15% to $443 million in the April–June period despite a 3% increase in liftings to 361,722 TEUs. There were brighter results in OOCL’s two other main markets. Intra-Asia and Australasia remained OOCL’s biggest contributor to revenue and volumes after the carrier saw a 9% increase to $728 million in second-quarter revenue. Liftings climbed 8% to 951,940 TEUs. Revenue from trans-Atlantic services surged 25% to $194 million, while container volumes rose 21% to 147,824 TEUs. OOCL’s update only gave revenue and liftings figures; parent company OOIL will likely release full half-year results in mid-August. The carrier’s revenue result echoes that of Taiwan’s Big Three container lines, <a href="https://www.joc.com/article/taiwans-big-three-carriers-see-falling-q2-revenues-as-demand-slump-begins-6041608">which on Wednesday reported worsening second-quarter revenues</a> compared with the first quarter. Contact Keith Wallis at <a href="mailto:keithwallis@hotmail.com">keithwallis@hotmail.com</a>.</div>

OOCL’s second-quarter revenues dropped 6.5% year over year to $2.1 billion amid falling freight rates on trans-Pacific and Asia-Europe services, the carrier said in a quarterly update Friday. The revenue decline came despite a 4.4% increase in total container volumes to 2 million TEUs, the carrier said. OOCL, the liner offshoot of Hong Kong-listed Orient Overseas (International), a Cosco Shipping Holdings subsidiary, said second-quarter trans-Pacific revenues were also hit by a 4.3% fall in container volumes to 501,814 TEUs. Trans-Pacific revenues fell 18% to $753 million in the second quarter from $922 million a year earlier. OOCL said revenue from Asia-Europe services dropped 15% to $443 million in the April–June period despite a 3% increase in liftings to 361,722 TEUs. There were brighter results in OOCL’s two other main markets. Intra-Asia and Australasia remained OOCL’s biggest contributor to revenue and volumes after the carrier saw a 9% increase to $728 million in second-quarter revenue. Liftings climbed 8% to 951,940 TEUs. Revenue from trans-Atlantic services surged 25% to $194 million, while container volumes rose 21% to 147,824 TEUs. OOCL’s update only gave revenue and liftings figures; parent company OOIL will likely release full half-year results in mid-August. The carrier’s revenue result echoes that of Taiwan’s Big Three container lines, which on Wednesday reported worsening second-quarter revenues compared with the first quarter. Contact Keith Wallis at keithwallis@hotmail.com .

Container lines

Trans-Atlantic

Asia-Europe

Trans-Pacific

OOCL’s Q2 revenue slides on lower trans-Pacific, Asia-Europe rates

<div class="phx-topic abstract-wrapper">Adoption of digital bills of lading has been stronger in Asia, but US traction is necessary to help container lines meet a 2030 commitment to fully move to electronic documents.</div>

Adoption of digital bills of lading has been stronger in Asia, but US traction is necessary to help container lines meet a 2030 commitment to fully move to electronic documents.

<div class="phx-topic">US Bank has completed its first trade finance transaction using a digital ocean bill of lading (BoL), another small step toward the industry’s intent to transition to 100% digital BoLs by 2030. The transaction, disclosed by US Bank on Thursday, was facilitated by electronic bill of lading (eBL) software vendor WaveBL for a US-based exporter using Mediterranean Shipping Co., which issued the eBL. MSC is a WaveBL customer, one of two container lines using the software vendor; Zim Integrated Shipping Services is the other. Adoption of eBLs is growing, but off a low base, and is more commonly used in Asia, where the eBL software provider IQAX is getting traction among banks and export suppliers. The nine member carriers of the Digital Container Shipping Association (DCSA) committed in early 2023 to shift to 100% digital bills of lading by 2030. This week’s move by US Bank highlights the potential in American banks adopting a process to accommodate digital BoLs. Traditionally, bills of lading transfer titles between buyers and sellers at a point determined by the shipment’s Incoterm, and banks traditionally play a role in issuing letters of credit to suppliers. In theory, an eBL would negate the need for most letters of credit, as the digital data contained in the document can be used by the buyer, seller, shipping line and banks to understand the financial risk of the shipment. “Our clients are looking for smarter, more efficient ways to manage their import and export activities,” US Bank Senior Vice President Christine Bravo said in a statement. US Bank said a transaction such as this normally would require a courier to physically transport documents across continents, often taking several days. “By contrast, the digital process reduced that timeline to minutes, eliminating delays, [and] enhancing security and compliance,” the bank said. Contact Eric Johnson at <a href="mailto:eric.johnson@spglobal.com">eric.johnson@spglobal.com</a>. </div>

US Bank has completed its first trade finance transaction using a digital ocean bill of lading (BoL), another small step toward the industry’s intent to transition to 100% digital BoLs by 2030. The transaction, disclosed by US Bank on Thursday, was facilitated by electronic bill of lading (eBL) software vendor WaveBL for a US-based exporter using Mediterranean Shipping Co., which issued the eBL. MSC is a WaveBL customer, one of two container lines using the software vendor; Zim Integrated Shipping Services is the other. Adoption of eBLs is growing, but off a low base, and is more commonly used in Asia, where the eBL software provider IQAX is getting traction among banks and export suppliers. The nine member carriers of the Digital Container Shipping Association (DCSA) committed in early 2023 to shift to 100% digital bills of lading by 2030. This week’s move by US Bank highlights the potential in American banks adopting a process to accommodate digital BoLs. Traditionally, bills of lading transfer titles between buyers and sellers at a point determined by the shipment’s Incoterm, and banks traditionally play a role in issuing letters of credit to suppliers. In theory, an eBL would negate the need for most letters of credit, as the digital data contained in the document can be used by the buyer, seller, shipping line and banks to understand the financial risk of the shipment. “Our clients are looking for smarter, more efficient ways to manage their import and export activities,” US Bank Senior Vice President Christine Bravo said in a statement. US Bank said a transaction such as this normally would require a courier to physically transport documents across continents, often taking several days. “By contrast, the digital process reduced that timeline to minutes, eliminating delays, [and] enhancing security and compliance,” the bank said. Contact Eric Johnson at eric.johnson@spglobal.com .

Logistics Technology News

US Bank eBL trial for US exporter notches another step toward 2030 goal

<div class="phx-topic abstract-wrapper">The Marseille-based liner has finalized operational plans to call off its remaining vessel-sharing agreements with the carriers after Gemini Cooperation-linked realignments.</div>

The Marseille-based liner has finalized operational plans to call off its remaining vessel-sharing agreements with the carriers after Gemini Cooperation-linked realignments.

<div class="phx-topic">CMA CGM is switching from vessel-sharing agreements (VSAs) to standalone operations across trades out of India in a new strategic approach as it expands its fleet. The Marseille-based liner has finalized operational plans to call off its two remaining VSAs with Hapag-Lloyd and Maersk after Gemini Cooperation-linked realignments. The upcoming disengagements include the Swahili Express (SWAX2) loop run with Hapag-Lloyd on the India-East Africa trade and the Midas network, involving two strings, operated with Maersk on the India-West Africa trade. CMA CGM has had three ships out of the five used on the joint SWAX2, with one vessel each from Hapag-Lloyd and Emirates Shipping Line (ESL). Midas has involved a fleet of 10 ships — six from Maersk and four from CMA CGM — on String 1 and three vessels from each on String 2. The French carrier has already sent its partners termination notices, due to take effect from next month for the SWAX2 operation and from late 2025/early 2026 for the Midas network. Sources at Hapag-Lloyd and Maersk in India were unavailable for comment. The Gemini launch in February saw CMA CGM delink from the decades-long consortium partnerships with Hapag-Lloyd on the India-US East Coast and North Europe trades. CMA CGM’s India VSA operations are now confined to Cosco Shipping/OOCL on the Epic service. Contact Bency Mathew at <a href="mailto:bencyvmathew@gmail.com">bencyvmathew@gmail.com</a>. </div>

CMA CGM is switching from vessel-sharing agreements (VSAs) to standalone operations across trades out of India in a new strategic approach as it expands its fleet. The Marseille-based liner has finalized operational plans to call off its two remaining VSAs with Hapag-Lloyd and Maersk after Gemini Cooperation-linked realignments. The upcoming disengagements include the Swahili Express (SWAX2) loop run with Hapag-Lloyd on the India-East Africa trade and the Midas network, involving two strings, operated with Maersk on the India-West Africa trade. CMA CGM has had three ships out of the five used on the joint SWAX2, with one vessel each from Hapag-Lloyd and Emirates Shipping Line (ESL). Midas has involved a fleet of 10 ships — six from Maersk and four from CMA CGM — on String 1 and three vessels from each on String 2. The French carrier has already sent its partners termination notices, due to take effect from next month for the SWAX2 operation and from late 2025/early 2026 for the Midas network. Sources at Hapag-Lloyd and Maersk in India were unavailable for comment. The Gemini launch in February saw CMA CGM delink from the decades-long consortium partnerships with Hapag-Lloyd on the India-US East Coast and North Europe trades. CMA CGM’s India VSA operations are now confined to Cosco Shipping/OOCL on the Epic service. Contact Bency Mathew at bencyvmathew@gmail.com .

CMA CGM ends existing Indian VSAs with Hapag-Lloyd, Maersk

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The world of LTL is slow to embrace change. Business anachronisms permeate current supply chain processes. These vestiges of the way things used to work define the LTL freight transportation procurement process of many modern shippers.David Knuth, logistics specialist at IEWC, a global supplier of cable and wire based in Wisconsin, is happy to have modernized the RFP process, automating the entire LTL bidding procedure with Bid$ense, SMC³’s automated truckload and LTL freight transportation sourcing solution. But when prompted, he can still recall what once was.In his previous job, a large part of his duties were consumed by creating an intermodal bid package for carriers. In a spreadsheet, Knuth detailed the company’s volumes lane by lane, taking care to delete any errant keystrokes or misleading data. He would then email out the information to each carrier, taking time to respond to detailed technical questions about the spreadsheet data. Finally, he had to compile all the results, create an algorithm that would compare the carriers on each lane, and award the business.“It was a huge undertaking. It took about four months to do,” Knuth said of the old process. “It was almost a full-time job for that part of the year, every year.”In his new job at IEWC, he sat down with Bid$ense on day one and was amazed at the capabilities. Knuth had never before used a bid tool. SMC³’s latest versions of Bid$ense automate the process even further, taking truckload and LTL RFPs entirely online. The tool draws on RFP best-practices protocols to streamline the bidding communication process, enabling bidding carriers to respond accurately and promptly to shipper requests. The solution also does all the distribution work automatically, electronically submitting shipper bid data to carriers based on their actual service capabilities and performance records. Carriers are alerted with timely prompts for RFP deliverables, so shippers aren’t waiting by the phone for responses.Another benefit of automating the process is the data-cleansing assistance. When Knuth sent spreadsheets to carriers, data errors might cloud the bidding process; he might have to resend data or simply accept a price that did not truly reflect the costs of doing business. Data cleansing is incredibly beneficial, he said.The spreadsheet technique also made bidding analysis an onerous task. Since Bid$ense automates and streamlines the entire RFP process, intensive examination is now simple. SMC³ knows that each bid has more than one best outcome. With uniform responses from each carrier, shippers can quickly rank results and create an unlimited quantity of what-if scenarios to make the optimal procurement decision.Jesse Burnett of Central Garden &amp; Pet experiences many of the same benefits. Founded in 1980, Central Garden &amp; Pet has spent the last three decades growing from a small garden supply company to a provider of a range of products from dog chews and bird seed to soil supplements and natural insecticides. For much of its life, the company shipped these disparate goods via LTL and truckload carriers to retailers throughout the country, relying on each business unit to negotiate directly with their freight transportation providers. This arrangement worked fairly well for a small company, but as Central Garden &amp; Pet expanded, leadership decided to consolidate decision making.Burnett helped centralize the transportation decision making in 2015 with SMC³’s Bid$ense. Before Bid$ense, every business unit operated independently as far as negotiating with carriers.“There were a lot of different things just floating around,” he said. “We didn’t have master agreements in place; no national pricing at all. The pricing from carriers was just all over the place, depending on where you were.”The transformations he saw with Bid$ense were immediate. Burnett has been using the tool about every other year since its implementation at the company. Central Garden and Pet’s $19.6 million 2019 LTL bid saved the company just more than 9 percent when compared to its historical average. For Burnett, though, bid automation extends far beyond savings.“We knew that we weren’t getting the best pricing offer from our carriers just because nothing was centralized,” he continued. “We knew that if we combined everything from all these business units and paired it with one corporate offering, then it would drive some cost benefit with it.”When the company initially decided to centralize bid procurement, executives researched a number of different methodologies and technologies. In the end, though, Burnett found that Bid$ense was both widespread and well known, and that his carrier partners already knew how to use the application. Burnett also highlighted the data-cleansing process as a major benefit, saying the rigorous process ensures that carriers always return the best price.“It definitely has helped drive savings,” he said. “Any time you go out there and you drive that competitiveness with the carriers and they know they’re in a bid environment, it seems to sharpen their pencils.”Transportation procurement is an integral part of the modern supply chain. With Bid$ense, shippers can develop a strategic implementation plan that saves them time and money, but also helps them create strong relationships with their carrier partners. These carriers appreciate the solution’s data-cleansing process; when carriers receive a complete shipment history and future volume forecast, they don’t have to guess on pricing. Carriers that receive more data from shippers get a complete picture of that shipper’s freight, allowing them to accurately plan instead of simply preparing for the worst-case scenario. Clean data presented through an automated system can lead to both bigger shipment savings and a lasting partnership between carrier and customer.Whether customers are looking to streamline over-the-road transportation bidding by automating the RFP process or create an entirely new, centralized sourcing process, Bid$ense has the analytical horsepower to get the job done.SMC³ 2020 Customer Case Study

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Shippers save money, time with automated transportation bidding tools

If there’s one immutable truth in the world of logistics, it’s this: LTL is an inherently complex form of transportation. Tariffs, rates, DIM weights, transit times — it’s enough to confuse even seasoned logistics professionals. The solution to this knowledge gap has historically been on-the-job training or university supply chain education, but for a variety of reasons there is now a pressing need for third-party, remote LTL training that prepares logistics workers for transportation success. Global Scope Can Overlook Local Intricacies In the past, professionals looking to move into a supply chain career learned about the basics of supply chain from universities. However, many of these college supply chain programs are now global in scope, focusing on worldwide supply chain management instead of the intricacies of specialized domestic transportation. And even these programs, which used to be widespread, are becoming less common. LTL is not an industry of broad-brush strokes; supply chain professionals really need a pointillistic understanding of the logistics of LTL in order to excel in the industry. Accelerating Need for Dedicated LTL Education This lack of specified training put the onus on employers to prepare new hires with the LTL knowledge needed to do their jobs. Dedicated LTL study is a necessity, not a luxury. At the same time, changes in LTL and the broader supply chain world are accelerating. The reliance on e-commerce has ballooned since the start of the pandemic, and last-mile LTL shipments and related e-commerce strains on the supply chain won’t diminish once social distancing abates. That genie isn’t going back into the bottle. So supply chain employers need logistics workers that are fully versed in all aspects of the industry, ready to solve unique shipping and delivery problems based on their extensive supply chain knowledge But why care about LTL? It’s been reported that some shippers in today’s world are no longer concerned with what mode is used to ship their goods. A Multimodal Approach Ensures On-Time Delivery This mode agnosticism means supply chain stakeholders have to be well versed in all modes of transportation. As unforeseen weather events and other disruptions, such as protests, become more common, savvy logistics employees will need to be armed with familiarity of all modes, not just the most popular, to ensure that freight is delivered on time, without damage, and in the most financially expedient way possible. Offerings like SMC³’s LTL online education courses cover a wide range of topics from LTL basics and operations to more advanced concepts like pricing analytics and transportation law. The company also has plans to continually refresh content, adding new expert presenters and taking the feedback of students to make the courses even better as time goes on. Learn more about&nbsp;<a href="https://logisticstrainingcenter.com/smc3-courses/" rel="noreferrer" class="joc_admin__link">SMC³’s LTL Online Education program</a>&nbsp;and view the 2021 hybrid schedule, featuring live industry experts,&nbsp;<a href="https://www.smc3.com/onlinelearning2021/" rel="noreferrer" class="joc_admin__link">here.</a>

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Filling the Supply Chain Education Gap with LTL Education Courses

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