The effects of COVID-19 on the logistics world have rendered everyone dizzy.
Skyrocketing rates, blank sailings, port closures, lack of equipment and space are just some of the problems facing businesses today. A year ago, no one would have predicted that ocean container rates would be in the $10-15K range today or a change in buying habits would cause a mass influx of goods into the U.S. Going out to dinner and a movie changed to takeout and binge-watching Netflix, while also buying that new big screen TV. Going somewhere nice for vacation changed to staying at home & starting a new hobby – cooking, gardening and home repairs, with a large chunk of those items coming from overseas.
We also discovered that our worldwide logistics infrastructure is quite fragile and rigid. It does not have the excess capacity to absorb any shocks to the system. If the Suez Canal is closed due to a vessel running aground, there is no other canal nearby to utilize. Vessel owners had to make a stark decision. Wait it out and hope for the best or divert your ship and take the long way around Africa, adding 9,650 kilometers to the journey. It turns out we can build fantastic ships that can transport 24,000 TEUs at one time, but the ports that handle them are a decade behind in their capacity. The increase in efficiency & scale that are gained with the increased vessel size, are lost in the days and weeks to get containers off-loaded and moving inland.
So where does that leave us? A perfect storm of events to be sure.
As I talk to my customers, the main topics of conversation are always “How long will it take to get space?” and “How much higher are rates going to go?” They are all looking for information to make an informed decision. They are all looking for news they can use to explain to their own management and customers the current market situation. I wish I could give them a simple answer as these are unprecedented times. Exceptional customer service is key in today’s market. What is exceptional customer service? Well, let me tell you first what it is not.
Several years ago, I needed to send original bills of lading to one of the ocean carriers. I sent an overnight courier pouch and tracked it the next day. According to the website, it never arrived at the destination delivery terminal. I called and after a few moments was speaking with a very pleasant person. I asked if they could track my package and they relayed the same information I saw on their website. I asked if they could contact the driver or the delivery terminal. They said they could do neither. I asked if she could start a search, she said yes but to allow them eight days to complete it. After several minutes of back & forth, I hung up quite aggravated and upset.
The person had perfect phone manners, was very polite and professional, so what was wrong? They had no access to real-time information, no ability to find additional information, but most of all lacked a sense of urgency!
My customers are all looking for information. Knowledge is power, so we try and provide as much information as we can.
Advising them on rates, GRIs, Peak Season charges and premium fees are just the beginning. We give them the latest news we hear from overseas and provide them with details that we hear and read about locally. My overseas colleagues are an invaluable source of information. They give daily market conditions and often hear about things first. When we hear what a large retailer is doing that could affect the market, we let our customer know so they can plan accordingly. When a phone manufacturer announces a new product launch, we advise our customers if space will be affected. We often hear about those things from our overseas offices first as they know which ports will be affected adversely.
Also, basic information alone is not enough though. I can go on any ocean or air carrier’s website, track a shipment and relay that information to my customer. Technically, I did my job. However, I know a lot of times that information is not up to date, incorrect or missing key details. Taking the next step and checking other sources is key in providing a complete picture to my customer. Yes, the vessel arrived, but has it berthed? Has their container been unloaded? Is it available at the pier? Is it blocked with no access? I had a trucker explain to me several weeks ago, that two large vessels docked at the same time in Baltimore and off-loaded several thousand containers. Everyone sent their trucks to start recovering the containers. All the drivers were able to get into the terminal, but then got stuck due to all the congestion and were not able to leave. Drivers ended up sitting for several hours until the congestion cleared up. Everyone missed their delivery dates and had to reschedule. That whole week was severely impacted with several shipment deliveries delayed. I was able to relay this to my customer to make them aware of the situation and give them a complete picture.
Finally, a sense of urgency to get shipment details to your customer is paramount.
Only then can they make an informed decision. A customer’s shipment of bolts is just as important to them as another customer’s shipment of pharmaceuticals. Making each customer feel important and show empathy toward their situation is vital. While you may not have all the answers, your customer will appreciate the effort you put forth and you will stand out from the crowd. I have a customer that I talk with regularly. He is always looking for market intelligence and the latest news. They ship heavy weight containers, and it is always an issue to get space. The recent issues due to low water levels in the Panama Canal only add to the problems for moving heavy-weight containers to the U.S. East Coast. We work diligently with our overseas colleagues to come up with solutions for him. Suggesting alternate ports, carriers and routes to try to secure space and get his containers to move. He knows that we are on his side and working for him. I share news that could impact his shipments almost every day and he is very appreciative of all the time and energy we put forth to assist him.
Today’s international marketplace changes at breakneck speeds. Ocean rates can change daily and vessel schedules are in constant flux. One little incident can have ripple effects throughout the whole supply chain. Information is vital for a business to navigate through all the potential pitfalls that could derail a shipment. Information is key to avoid additional cost and delays. Exceptional customer service provides this information and assists customers in getting their goods to market.