Greg Boyle, Director, Global Sea Freight, Signify

https://signify.com/
Dec 29, 2021, 1:30 PM EST
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Greg Boyle

When traveling, I live by the motto “Expect the worst, but hope for the best.” This leaves little room for disappointment; expectations literally couldn’t get any lower.

Over the past year, many shippers lived by the same motto and were still disappointed. Their hopes were met with dismal on-time performance, bookings with no equipment, chassis shortages, fragmented terminal appointment schemes, track-and-trace systems with missing or delayed updates, contract terms and conditions that were ignored, and wildly volatile buy-sell spreads.

Ironically, the worse things got for shippers, the more money the carriers started raking in. It became evident that there were some players in the game that followed the motto of “Hope for the worst, expect the best,” and they might not want to see things improve as quickly as others.

As this realization began to resonate with shippers around the world, the entire idea of an optimal global supply chain was placed under the microscope. With rates being so high, space being so tight, on-time performance being so poor, tariff volatility, and customer service quickly becoming an afterthought, some shippers are rethinking the benefits — or lack thereof — of offshoring manufacturing, thereby subjecting themselves to the inherent risks in today’s global supply chain.

At the same time, many carriers, flush with cash, decided that now is the time to order a record number of ships, which will drastically increase available capacity in the next 18 to 24 months. That means there is a 10 percent increase in capacity on the horizon coupled with a potential 15 to 20 percent decrease in demand due to nearshoring.

That’s the thing about that motto: It’s all in the eye of the beholder.