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HomeBusiness21st Century ChallengesWhy Ocean Carriers are Reducing Service Quality While Growing Their Core Services

Why Ocean Carriers are Reducing Service Quality While Growing Their Core Services

It’s time to talk about the elephant in the room for ocean carriers: reduced service quality.

We are reading every day about new investments of ocean carriers to extend their core ocean freight services to more value-added services that require more integration with their customers. We are seeing them extending to last-mile deliveries, customs clearance, project cargo, airfreight, warehousing, etc.

While all this is going on, there is a significant problem facing all of us in the shipping industry – the service quality of ocean carriers is the lowest that I have ever experienced in the past 15 years I have been working in logistics in the U.S. The same feeling is felt by thousands of others, too.

My point here is not really about the supply chain disruptions – not vessel delays, not vessel cut offs, not port congestions, trucking issues, etc. Those elements are already there. The challenge is the simple needs of the market. As a NVOCC shipping over 40,000 to 50,000 TEUs per year, we are acutely exposed to all of issues that we are facing with ocean carriers at every level.

Some of the key issues we are facing from ocean carriers include:

1. Booking turnaround times are much higher than industry standards.

2. Accuracy of documentation and information getting receipt is in free fall.

3. The exception handling and escalation processes are overwhelmed.

4. There is a significant quality gap between ocean customer service teams in the U.S. and in their overseas. Not only a lack of training but also a disconnection among teams.

5. There is no more personalized service, and sometimes not even a person to speak to.

6. There is no ownership – even emails without names and phone numbers.

7. Very high employee turnover is plaguing the industry.

I understand the fact that the current market conditions cannot be overlooked while evaluating carriers’ teams. This is due to significantly larger workloads and a lot of repetitive work.

However, if ocean carriers are getting into those value-added services, they need to get used to this type of environment permanently.

The existence of many of those companies that they are acquiring today or will be competing with in the future relies on the fact that those type of activities are never as straightforward as shipping a container from port A to port B under normal market conditions. You cannot evaluate those teams by how fast they reply to emails or pick up calls or standard turnaround times. You need ownership from your teams, you need your teams to act as a single body, and you really need to build rapport with your customers.

It will be very interesting to watch this transition of carriers and see how successful they will be.

M. Can Fidan
M. Can Fidanhttp://www.mts-logistics.com
Can is originally from Turkey, where he got a Bachelor’s Degree in Economics at Koc University in Istanbul. After working 5 years at MTS Turkey, he moved to Hong Kong as an MTS Representative, where he stayed 2 years working on Asia Development of the group. After Hong Kong, he came to MTS New York. He is currently the Vice President of Business Development and Export Manager at MTS Logistics, Inc. Fun Fact: Can (read as John in Turkish) is a HUGE soccer fan, and Besiktas is his team. Despite the fact that he has been living abroad since 2005, he follows each and every game religiously!
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