Feb 05 2018
Is Ocean Freight The Right Shipping Option For You?
There’s no question that all import/export businesses would like to reduce their shipping costs in one way or another. Freight costs typically make up a significant portion of your overall business expenses. It falls on the shoulders of supply chain professionals to optimize their logistical processes in order to cut costs and boost efficiency.
Ocean freight refers to the movement of goods through shipping lines. The shipments are packed into shipping containers and it is the responsibility of the freight forwarder to book the container with the shipping agent. Additionally, special equipment that cannot be containerized (even when disassembled), is shipped through similar lines. These items command premium fees as they do not conform to standard dimensions and normally require specialized cranes to load/unload while in port. The itinerary can have some flexibility -- it can be port-to-port or it can also include trucking services (door-to-door), depending on what you’ve negotiated with the forwarder.
If your business requires the import/export of cargo worldwide for Full Container Load (FCL) or Less-Than-Container Load (LCL) freight as well as the aforementioned special equipment, you will need to determine if ocean freight is appropriate for your shipping needs.
The advantages of working with an ocean freight forwarder include:
There is great flexibility in the types of goods that can be transported. In some cases, it may be the only affordable option for certain types of materials. In addition to this, most freight forwarders have negotiable rates. While the upfront costs of airfreight are higher, insurance premiums may be higher for ocean freight.
This mode is best for larger volume shipments, in which long haul trips are acceptable. Alternatively, most airline companies focus their efforts on developing their planes for passengers, leading to a reduction in cargo air fleet. In fact, a vast number of current cargo aircraft started life out as a passenger jet but after time, they are slated to be converted.
The disadvantages of moving goods by ocean freight include:
Using ocean freight might mean that you have to sacrifice reliability. There is a chance that ship voyages are delayed or canceled, resulting in slower shipment times. While flights do get delayed due to weather and other occurrences, airlines make it their business to be on top of their schedule. Ocean carriers have a harder time keeping up with their schedule, but that isn’t to say they are unreliable. Rough seas and geopolitical issues can severely impact ocean going vessels.
Beyond potential delays or cancellations, shipping routes are inherently slower than airplane travel. It’s no secret that moving goods by air is faster -- air freight can sometimes even deliver goods in only one or two days! Shipping by sea can often take several weeks to months.
It's integral that businesses look at their particular needs before selecting a mode of transportation for their goods. Some businesses may value speed over cost, depending on their model. Both ocean carriers and shippers will need to closely monitor the conditions of the market on an ongoing rate, as they are always subject to change.
The most successful businesses continually assess their supply chain needs at multiple touch points and will recognize that there is always room for improvement throughout the logistical processes.
To learn more about how Seldat is becoming the global leader in technology-driven supply chain solutions, reach out to our team today:
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Email: Global Sales
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