Logistics Management

"Bigger is cheaper" thought is whats killing exporters. Unfortunately, everybody in this business is tuned into shipping bigger loads, however, if we ever look at the true cost (cost of holding huge piles of inventory, loading and unloading time, docking time etc.) shippers end up paying more by using mega-ships. Personally, I believe, there should be small capacity ships for small to medium businessess. This would guarantee gauarntee good service and better turnaround time for the shipping company

Your point is well taken. One might hope that carriers introduce more tonnage next year by using smaller vessels in a deployment calling niche ports.

The answer to that question is to use an NVOCC. Companies like DHL Global Forwarding (or another good NVO) are amongst the top purchasers of ocean space globally. If you dont have the volume, you should pool your volume with others under an NVO agreement. The service will absolutely be better and so will your rate vs direct negotiations with ocean carriers. I've spent 25 years in the ocean business. I have never seen worse customer service than now with carriers. Get with a good NVO.

I also think people tend not to be as educated as they need to be about the tactics of the ocean carrier. typically the space issues, increased trans-pacific costs are directly caused by the carriers and the associations they below to. We all knwo the carriers took vessels out of thier strings to tighten up space which leads to extending the Peak Season charges and let's not lose site of the fact that the alliances the carriers are in nothing short of collusion. However in my past experiences, if the improter or export are knowledgeable about these tactics, during contracts, they can use them to thier benifit.

Don't overlook incoterms. As a small or medium sized shipper the chances are you may be buying on C terms...in which case you are in the hands of the supplier, and no leverage with the lines. I agree with Eric, get a good NVOCC, and look at the way you're buying. Paul

I keep hearing the industry using the term comparing "Vendor shipping Lanes vs KIT" and I am looking for a good explanation of exactly what KIT is and how it can save a medium size business in either cost or delivery time. Has anyone else hear this term pop up recently?