The end of the year is the time to extend or conclude new contracts. Some shippers may be dissatisfied with the trusted logistics company due to delays or high freight costs. However, supply chain failures are only sometimes the contract partner’s fault. Here are some external reasons to help you understand the transportation situation and successfully cooperate with the contractor.
Lack of carriers
You are not alone if you have been disappointed at least once with your orders’ fulfillment speed. Currently, only nine ocean forwarders are operating worldwide, and most carry the same routes, provide similar services and offer the same rates and transit times as others. But the contractor should not be blamed for this.
Delivery times also depend on the weather, vessel queues for unloading, free terminals, sufficient workers in the main ports, and other conditions.
Stabilization of the logistics supply chain
Vessel traffic in major US ports (congestion in Los Angeles and New York) and China (Covid-2019 restrictions) has recently stabilized, so there should be no delays in shipping.
Review of contracts
It is equally important to carefully study each party’s contract terms and responsibilities in partnership with a logistics company.
You can offer your options on which you agree to cooperate and consider them in the contract’s text for obligations. Discuss fines, additional issues in service, or longer payment terms.
If the changes in the contract are not fundamental, they can be beneficial for both parties.
You can also insure the shipment against the risk of damage or loss if you are not sure that the carrier’s service is being provided correctly.
Overflow of warehouse stocks
Before increased consumer demand associated with increased online shopping during the pandemic, major brands significantly replenished their warehouses with products. However, commodity inflation contributed to the decline of interest in buying and saving financial funds, and there are still a lot of warehouse stocks.
That is why the big brands began to order shipping their goods less often, which means more space on the ship for the cargo of medium and small market players.
This is another reason to cooperate with a trusted logistics company. Enormous congestions in international ports are no longer expected during the “peak” season.
Reduction of freight rates
With container spot rates down by about half (50%) from their peak, contract rates are expected to decline further through 2023 as overcapacity builds.
In most cases, delivery depends not only on cost and terms but also on the service level. In the pursuit of the lowest price, you can lose the quality of service. That is why you should choose a company from which you expect a positive transportation experience and maximum support from the manager.
As a connecting link between the importer and the carrier PartnerTrade guarantees compliance with all the conditions specified in the contract. We fulfill our obligations to ship the cargo to the destination point entirely, in good quality, and on time.