How the world’s ocean carriers are shifting their priorities and developing initiatives in order to meet customer demands for better service.
In a world where all industries are paying closer attention to how they service their customers before, during, and after the sale, it would just make sense for the world’s ocean carriers to follow suit and launch new customer service initiatives.
Whether that means offering premium services; guaranteeing transit times; or managing faster freight loading and unloading, the opportunities to improve are virtually endless.
“Having spent the last decade cutting costs to a degree that often disadvantages customers, container carriers have reached a point where they can’t slash costs more; even mergers will yield little if any additional value,” JOC reports. “Thus, carriers have no choice but to begin looking at ways of escaping the vicious cycle of commoditization and finding ways to create value for customers.”
Walking the Customer Service Walk
A.P. Moller-Maersk is one large ocean carrier that’s gotten onboard with the idea of improved customer service. In September, it announced that it would combine its offering for ocean products and supply chain services to be able to offer more comprehensive end-to-end logistic solutions for cargo owners.
“Today we are taking further steps in the transformation of our business on a structural level and how we go to market, enabling us to offer more solutions to our customers in a simpler way,” A.P. Moller’s CEO Søren Skou said in a press release. “Our employees play a key role in making this happen and therefore we are at the same time empowering our frontline organization [that] is closest to our customers.”
Hapag-Lloyd AG is taking a similar approach. Wolfgang Freese, former president of the company’s North America region, told JOC that ocean carriers’ “race to scale” the past 10 years, did result in some cost reductions being passed along to customers. However, that strategy has since run its course.
“The past was all about reducing unit costs, which overrode all other considerations including service quality,” Freese told JOC. “What was not seen, because there was no money available to spend, was investments in improving service quality including improvements in customer service.”
A New, Emboldened Carrier Industry
Predicting that a new, emboldened carrier industry will rise out of the massive consolidation wave that took place in the ocean industry over the last two years, Freese sees customer service as the first, visible major-change area.
“Something new is coming. The focus going forward will increasingly be [transitioning] from cost-cutting measures toward creating value for customers, in terms of how carriers can share in the value that is created,” Freese told JOC. “Carrier service will improve, as will schedule reliability and customer service levels.”
Smaller carriers are also implementing more customer-centered strategies. With a fleet of about 25 vessels serving 40 different ports, Seaboard Marine provides direct, regular service between North America, the Caribbean Basin, Central, and South America. Last month, it announced that it was collaborating with XVELA to help improve stowage efficiency and real-time visibility into terminal operations.
According to a XVELA press release, the Miami-based carrier is using its platform to perform container vessel stowage planning activities, share key collaborative information, and view real-time terminal operations data to maximize port stay operations. The same platform is helping the carrier improve communication, efficiency, and transparency throughout the stowage planning and execution processes.
“Partnering with XVELA has allowed us to streamline our planning and execution processes to further improve our operational efficiency,” Seaboard’s Hector Velazco said in the press release. “Having greater visibility into vessel stability and lashing lets us cut down on the number of iterations of our stowage plan during the planning process. Visibility into real-time crane operations gives us the information we need to make decisions such as precisely when to call the pilot.”
The fact that more ocean carriers are now putting their customers first is good news for shippers that rely on them to import and export their goods in the Americas. As the year progresses, stay tuned to learn more about how ocean carriers are working in partnership with their customers and logistics partners to ensure the smooth transport of goods overseas.