Ocean cargo shippers to be given new performance measurement tool

In an effort to help importers and exporters benchmark their carriers’ service levels, Drewry and CargoSmart have agreed to introduce a wider range of container Key Performance Indicators (KPIs).

Drewry will incorporate the additional KPIs into a new quarterly report, the details of which will be announced later this month.

“The new container KPIs will add value as they will measure performance at the box-level, which is more important for shippers than at the ship-level,” said Philip Damas, director at Drewry.

Spokesmen added that Drewry has chosen CargoSmart for its “high quality data,” which is necessary for KPIs to be effective for decision-making.

“Measuring KPIs is critical for shippers to optimize their business operations,” said Kim Le, director of CargoSmart North America.

Le said that the complementary data and analysis will provide a perspective analysis for shippers to make informed decisions about their carriers, ports, and routes.

The new KPIs will monitor not only the performance of the physical port-to-port shipping operation, but also the performance of commercial processes, as well as regional inland transport performance and port dwell times.

Drewry was the first company to introduce, in 2006, independent schedule reliability KPIs and spot container freight rate benchmarks. Six years on, Drewry intends to bring more transparency, accountability and comparability in other key aspects of container carrier performance, through its partnership with CargoSmart, providing like-for-like, regular assessments of carrier industry performance and quality over time.

“Drewry’s reporting over recent years has indicated that only 60 percent to 70 percent of containership sailings arrived on time, with carriers only recently deciding to provide a guaranteed standard of service with compensations for delays,” Damas said. “In a service industry, we believe that it is important that buyers know what standards of service and performance they can expect from the carrier industry – whether good or bad - and what it means in terms of value-for-money and the cost of failed performance.”

Many large importers and exporters today already measure various performance metrics for the carriers they use. The Agriculture Transportation Coalition (AgTC), for example, conducts an Ocean Carrier Performance Survey every year.

AgTC’s executive director, Peter Friedmann, told LM that the 2012 Survey will rank the following carriers: APL, China Shipping, CMA-CGM, Cosco, Evergreen, Hamburg Sud, Hanjin, Hapag-Lloyd, Hyundai, K-Line, Maersk, MOL, MSC, NYK, OOCL, U.S. Lines, United Arab, Yang Ming, and ZIM.

The new industry KPIs provided by Drewry and supported by CargoSmart will provide a comparative, standard assessment of the performance of the carrier industry as a whole and of carriers unknown to shippers, which is not otherwise available even to large shippers.

Drewry will disclose information on the new industry KPIs later this month, once the first phase of analysis has been completed.?