Maersk abandons their Daily Maersk service

Good afternoon All

The worlds largest shipping line, Maersk, has abandoned their brave attempt at product innovation/differentiation, the Daily Maersk. The general idea behind this service, first launched in Sep-11 (hard to believe it was almost 4 years ago) was that European importers from Asia would pay a premium price for a service which claimed to depart daily and had uplift guarantees.

The problem was that it wasn't a daily service at all and so this seemed to devalue the product, and secondly rates from Asia fluctuate wildly and apart from certain times of the year (lead up to Chinese New Year) and from Aug-Oct, there is a lot of capacity, allied to the fact that shipping lines are investing in larger and larger vessels (say 8,000 TEU 10 years ago to 15,000 TEU and rising in 2014) so

1. the lines have the space
2. they need to fill it
3. importers don't see a need to pay a premium for products like Daily Maersk

I suppose it's proof, if ever it were needed, that if you do innovate, you need to put forward something which the market really needs, promote it well - and price it at the right level.

I think that another major reason for it's failure was that the product name was very attractive but when people explored further, they didn't feel it was such an innovation, and certainly not worth paying more, when they could achieve reliability and cost effectiveness via the other Asia-Europe carriers.

http://www.lloydsloadinglist.com/freight-directory/news/Premium-Daily-Maersk-service-abandoned/61956.htm?utm_source=Lloyd%27s+Loading+List+Daily+News+Bulletin&utm_campaign=7ab76e1f48-Wed_30_July7_30_2014&utm_medium=email&utm_term=0_1a5c244239-7ab76e1f48-256747097

Kind Regards

Andy

Andy Cliff
Director

Straightforward Consultancy Ltd
4, Beckett Drive
Winwick Park
Warrington
Cheshire
WA2 8XJ

Tel : 07934 443492
Email : andy@straightforwardconsultancy.co.uk
Web : www.straightforwardconsultancy.co.uk
Blog : http://straightforwardconsultancy.blogspot.co.uk/
Twitter: @AndyCliffSCL
Linkedin: https://www.linkedin.com/in/andycliffscl
Skype: andy.cliff1@skype.com

USA West Coast Port Dispute - Latest News

Good afternoon

Seems we finally have some positive news to report after months of disruption on the West Coast of the US - but it will take 2-3 months for ports like LA and Long Beach to get back to some sort of normality.

Below is an excerpt from a bulletin we've just received.

After 10 months of negotiations the International Longshore & Warehouse Association ILWU) and the Pacific Maritime Association (PMA) finally reached an agreement on a new five-year contract.  Although there appears to be lots of press about this matter there has not been any details released other than the new deal will include a new arbitration system.

But the important part is that the ILWU went back to work, full steam on Saturday, February 21, 2015.  It is undetermined how long it will take to clear up the congestion that has been created from the slowdown.  Although the agreement has been reached it still has to be ratified by its members, but all articles appear to indicate that ratification is expected.

It goes without saying that the slowdown and congestion has resulted in a significant economic impact that may be long lasting.   It took third parties like the National Retail Federation and other organizations to pressure Congress and the White House to finally send Labor Secretary Thomas Perez, last week to break the stalemate,  that the Federal Mediation and Conciliation Services (FMCS) was unable to resolve since the beginning of January.

Although the contract settlement is a positive note after months of slowdown, It remains to be seen how quickly things will clear up.  Drayage companies have already experienced seasoned drivers leaving the workforce resulting in a shortage of drivers.  Additionally, it is uncertain whether the equipment arrangements will improve or remain a sore point with truckers.

It appears that only time will tell.  For interested readers, we expect that details of the contract to be revealed after it has been ratified.  But one thing for sure, it is finally good to report that there is a light at the end of this tunnel. 

Kind Regards

Andy
Andy Cliff
Director

Straightforward Consultancy Ltd
4, Beckett Drive
Winwick Park
Warrington
Cheshire
WA2 8XJ

Tel : 07934 443492
Email : andy@straightforwardconsultancy.co.uk
Web : www.straightforwardconsultancy.co.uk
Blog : http://straightforwardconsultancy.blogspot.co.uk/
Twitter: @AndyCliffSCL
Linkedin: http://uk.linkedin.com/pub/andy-cliff/1a/43/72
Skype: andy.cliff1@skype.com

Our Article On Fuel Surcharges Makes The National Press!

Good afternoon All

You probably know by now that here at Straightforward Consultancy (SCL), we're always trying to see things from the customer's point of view in what can seem to be (is) a pretty complex and confusing industry, and most customers wouldn't really know where to start when challenging highly contentious matters such as fuel surcharges and many wouldn't know how their total freight cost is built up what with all the different line items, charges, acronyms and industry terminology.

So I feel it's for a company like SCL to speak up and of course we're in an ideal position to do that, as we're completely independent, and so we can speak freely.

I also sometimes feel that no one speaks up for the small-medium sized importers and exporters who don't have the luxury of in house experts, shipping manages, logistics managers and supply chain managers etc and this is where we fi in.

With that in mind, I decided to write an article for the national press and it's since been published by the industry leading publication, Lloyds Loading List/IFW which sends out a daily bulletin as well as publishing in print also.

Below is the link to the article and I hope you find it to be interesting.

http://www.lloydsloadinglist.com/freight-directory/adviceandinsight/Fuel-surcharges-–-a-level-playing-field/61748.htm

Kind Regards



Andy Cliff
DirectorStraightforward Consultancy LtdEmail : andy@straightforwardconsultancy.co.uk
Web : www.straightforwardconsultancy.co.uk
Blog : http://straightforwardconsultancy.blogspot.co.uk/
Twitter: @AndyCliffSCL
Linkedin: http://uk.linkedin.com/pub/andy-cliff/1a/43/72
Skype: andy.cliff1@skype.com

USA West Coast Port Dispute - finally President Obama sends in the Cavalry!

Afternoon All


Please see attached latest update, Mr Obama has finally listened and sent in the Cavalry…in the shape of Tom Perez, US Labor Secretary. There are now 33 vessels sitting in the bay, awaiting unloading at LA/Longbeach…!

This dispute has been dragging on for 9 months now and is clearly harming the US economy and adding huge costs to US importers who are forced to pay extra costs to import through LA/Long Beach or make costly divertions into other unaffected ports such as Houston. This is what we're doing for one of our large US customers.

http://www.lloydsloadinglist.com/freight-directory/news/Obama-steps-in-as-fears-grow-of-US-west-coast-ports-shutdown/61740.htm?utm_source=Lloyd%27s+Loading+List+Daily+News+Bulletin&utm_campaign=0fbcd7ad3f-Wed_30_July7_30_2014&utm_medium=email&utm_term=0_1a5c244239-0fbcd7ad3f-256747097

 

Kind Regards

Andy
Andy Cliff
Director

 


Straightforward Consultancy Ltd
4, Beckett Drive
Winwick Park
Warrington
Cheshire
WA2 8XJ

Tel : 07934 443492
Email : andy@straightforwardconsultancy.co.uk
Web : www.straightforwardconsultancy.co.uk
Blog : http://straightforwardconsultancy.blogspot.co.uk/
Twitter: @AndyCliffSCL
Linkedin: http://uk.linkedin.com/pub/andy-cliff/1a/43/72

Taken a look under the bonnet of your international freight & logistics recently?

Good afternoon All

I was driving down the motorway recently and an interesting thought came to mind which connected the world of international freight & logistics to the cars we drive today.

Most people would agree that cars are becoming more and more complex, and even basic servicing is beyond most of us, either for fear of breaking something, invalidating the warranty or if we're brave enough to consider it - for not having the specialist tools or expertise to carry out the job ourselves.

We're therefore pretty resigned to the fact that if we want our car to remain reliable, safe and efficient that we should entrust the work to experts, qualified motor vehicle technicians, who spend every day of their life working on them.

And that's when I had the thought - logistics is a very specialised field too, however many companies never give their logistics model a service, safety inspection or winter safety check!

In truth, the supply chain may work ok service wise but the chances are, that just like your car, its performance and fuel consumption have been getting gradually worse over time. Many customers just accept that the freight or duty costs are "what they are"...and checking freight invoices is not something that many customers are qualfied to do or enjoy doing, quite understandable given the number of different charges and acronyms used!

So often, their challenge is that even though they know their supply chain really does need an overhaul, they wouldn't know where to start in researching better or more cost effective alternatives, and in many small to medium sized companies, they really do not have the resources or expertise to carry out a professional logistics RFQ and selection process.

We generally work with small-medium sized UK importers and exporters who spend £50-£500K per annum on air and ocean freight costs and most of our customers so far had the very same dilemma, quite understandable in small-medium sized companies who have very flat organisational structures and often little in-house expertise.

Their initial concern is that they could not afford to employ consultants on a traditional time based fee model and so we operate on a results based fee model which generates significant freight savings (average 35% across all clients since 2009) and leaves the client with the lion's share of the cost savings and a leaner, more customer focused logistics model.

We carry out the whole process for the customer from an initial assessment onto the RFQ, selection and then implementation, and then managing the new freight model for them to ensure rates are charged as agreed, services are monitored and rates are re-negotiated to ensure their new costs are kept under tight control, and most customers emply us long term to manage their freight model and keep it sharp, competitive and supported by experts.

We offer a free no-obligation meeting to importers/exporters in the North West so we can explore what opportunities there may be and we have some excellent testimonials, many of which are quoted on our website and LinkedIn.

So the next time you think that your car needs a service, consider whether your supply chain would benefit from the same expert attention, you'll be glad you did.

Kind Regards


Andy Cliff

http://www.straightforwardconsultancy.co.uk/

The Big Disconnect - Crude Oil, Jet Fuel and Air Freight Fuel Surcharges...

Good evening All

We’re all aware of the collapse in the price of crude oil, which has recently fallen below USD 50 a barrel, a fall of 57% since its peak in Jun-14 - and the consequential fall in the cost of petrol and diesel at the pumps - a welcome relief to hard pressed hauliers and motorists.

The government have made it very plain that they will be watching the oil companies extremely closely to ensure that these savings are passed on to motorists / hauliers to benefit the wider economy but it seems we have some sort of disconnect when it comes to international logistics.

We manage the freight and logistics models for customers of various sizes and deal with several forwarders so feel that we have a pretty good perspective.

And here’s my point - with air freight in particular - how it is that we’re not seeing reductions in air freight fuel surcharges. We’ve done some analysis and have come to a rather disconcerting conclusion. It seems the price of jet fuel and crude are closely linked, and that jet fuel costs have fallen by 45% between Jul-14 and Jan-15 however fuel surcharges have hardly moved. On five major airlines flying across the North Atlantic, we found that fuel surcharges were an average of USD 1.07 per kilo last April, and many had been at that level for at least a year. And today, the average fuel surcharge for those same 5 airlines is, would you believe it, USD 1.06 per kilo!

http://www.iata.org/publications/economics/fuel-monitor/Pages/price-development.aspx

Given that on many trade lanes, FSC is a significant part of the air freight cost, and sometimes as much or even more than the core airport-airport rate, then surely the airlines have a duty to pass on these large falls in their costs via forwarders to UK importers and exporters just as the oil companies have with petrol and diesel at the pumps.

Andy Cliff
Director
Straightforward Consultancy Ltd - logistics simplified

Straightforward Consultancy Ltd
4, Beckett Drive
Winwick Park
Warrington
Cheshire
WA2 8XJ

Tel : 07934 443492
Email : andy@straightforwardconsultancy.co.uk
Web : www.straightforwardconsultancy.co.uk
Blog : http://straightforwardconsultancy.blogspot.co.uk/
Twitter: @AndyCliffSCL
Linkedin: http://uk.linkedin.com/pub/andy-cliff/1a/43/72
Skype: andy.cliff1@skype.com

2014 Review and Why Customers Always Come First

Good evening All

As my co-director has just reminded me, I haven't updated our blog for quite a while now for which I apologise! Thing is, 2014 was our best year to date, surpassing even our record year in 2013 which meant a heavy focus on our customers.

When it comes to a toss up between spending time on existing customers and their challenges and time on sales, existing customers always win, hands down - why? Because our customers remember the challenges and that we were right there alongside them and actively resolving a situation or influencing the outcome - and that's probably why they stay with us year on year (our first customer from 2010 is still on board today).

Also, when we carry out one of our Freight Reviews for a brand new client, we are completely refreshing their logistics model - cost - service levels - Customs compliance (a time consuming but worthwhile process) and it's really important to us that not only do we achieve or exceed the results we promised in our proposal, but that we monitor the traffic closely until it's completely bedded in and as  a result of that we neglected our blog, Logistics Simplified.

Having said that, we did remain very active on other platforms such as LinkedIn and Twitter and I should also mention that we launched our new website in Sep-14, something we spent around 4-5 months on. My wife and co-director Diane Cliff was the lead on this, and working alongside a graphic designer and the web design company, she delivered a superb result in that we retained the simple and straightforward feel of the site but refreshed our strap line to Logistics Simplified and also more clearly defined the 4 services we offer today - Freight Reviews, Freight Management, Customs Compliance and Consultancy, something the old site didn't convey that well.

Now I've made a start and revived our blog I will keep it going and share our continuing journey with you!

Kind Regards



Andy Cliff
DirectorStraightforward Consultancy LtdEmail : andy@straightforwardconsultancy.co.uk
Web : www.straightforwardconsultancy.co.uk
Blog : http://straightforwardconsultancy.blogspot.co.uk/
Twitter: @AndyCliffSCL
Linkedin: http://uk.linkedin.com/pub/andy-cliff/1a/43/72
Skype: andy.cliff1@skype.com