This commentary appeared in the print edition of the Jan. 6, 2020, Journal of Commerce Annual Review and Outlook.
For decades, it was not uncommon to see customers’ cargo not arrive at the terminal for loading on a vessel as planned. For us, this percentage of “no-shows” could range to up to 30 percent of bookings, making it difficult to compensate for the cost of sailing vessels that are half full. The ripple effect of no-shows is not limited to carriers; they affect all players in a single supply chain ecosystem that depend on cargo being delivered as planned.
To address this, Safmarine was forced to add an equal percentage of additional bookings to our vessels. However, without a bellwether to accurately predict the number of no-shows, customers’ cargo would roll to the next available sailing or vessels would sail with open space. And so, the vicious cycle continued for years — until now.
In 2019, Safmarine, together with its parent company, introduced a digital solution called Spot, designed to break the cycle of overbookings and no-shows, which has led to millions of dollars of costs incurred at all levels of the supply chain. In a nutshell, Spot is a digital product offering cargo loading guarantee at a fixed price upfront, available 24/7 online. When customers book on the Spot platform, they have guaranteed equipment availability from Safmarine, a fixed rate, and a load guarantee. Customers enjoy a simple experience, down from a 13-step process on a traditional booking to five simple steps on our website. All of this translates to full predictability in our customers’ supply chains and a commitment from both parties to deliver on their agreement.
Since the launch of Spot, we now have 20 percent of our export customers in Canada booking on the platform, with 99 percent of shipments loaded as planned. No rollings means full predictability of customers’ supply chain and confidence that their cargo will be delivered as promised. In the end, everyone wins.
The coming year looks even more promising as we prepare for an implementation of Spot in the United States. As with any new product adoption, we expect a gradual shift of customers’ preference towards a solution designed to increase predictability and reliability in their supply chains. In the end, our goal is to continue to develop solutions that bring value to our customers when and where they need it the most.