Category Archives: Supply Chains

Detention and Demurrage claims are rolling in

Posted on June 29, 2024 by | Leave a comment

Samsung Electronics of America (SEA) is a major user of container shipping. They have decided to fight back against excessive and frequently undocumented Detention and Demurrage (D&D) bills from carriers. This article spells out the claims.

Overall, Samsung thinks ocean carriers were selling door-to-door service and couldn’t deliver it. So they started billing customers to recover their costs.

The Federal Maritime Commission (FMC) has recently established rules about billing for such services, making the billing more transparent and requiring documentation for each charge. This will help shoppers, who are frequently baffled by the charges.

It’s essential to close down the practice of billing without thorough documentation. Seagate should have lots of winning arguments in these cases. There were so many temporary closures, changing windows for pickup and delivery, and other delays not caused by the shipper during the COVID era and after, that most D&D charges were probably due to slipups out of the shipper’s control, and perhaps even the carrier’s control. Carriers should not be entitled to profit from these.

Seatrade logo

Nick Savvides | Jun 17, 2024

Samsung Electronics America fires D&D claims at carriers

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Posted in Logistics, Shipping, Supply Chains

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Port call optimisation reduces greenhouse gas emissions in ports

Posted on June 20, 2024 by | Leave a comment

Drewry is well-known for its expertise in maritime-related matters. In a recent market opinion piece, they suggest that maritime emissions can be reduced rather simply, with port call optimization. They mean to reduce the time ships sit near a port waiting for their berth to open up.

Some ports have been successful with appointment windows. But the Drewry approach includes slow steaming to hit the port berthing window close to the time, instead of standing offshore running engines and emitting pollution. The slow steaming itself is a tested measure for reducing emissions, though it doesn’t eliminate them. The two efforts combined could save a lot of pollution, and now in some places such as the EU, emission charges based on actual fuel use numbers.

Eliminating waste in a system, such as waiting time waste, is a tried and true operations management or lean technique. But in the case of maritime shipping and ports, a lot of coordination is required. Systems need to be in place to provide accurate information about ocean carrier voyage schedules. Sailing times between ports can vary a lot, because of factors such as weather and route adjustments.

But also, both ocean carriers and ports need to share information and cooperate on setting berthing schedules. A late loading in Shanghai, for instance, will affect the projected arrival time in Long Beach. the two ports and the carrier will need to share up-to-the-minute (or hour) information about progress. Will they do it? It will require a level of interaction never before seen.

I think that ultimately, ports and carriers will be driven to this by the gains that can be made. but I think it will be a long time coming.

Update: Port optimization can actually prevent deaths. Hong Kong University of Science and Technology (HKUST) has recently studied the number of deaths that could be prevented by port waiting time improvement.

Sam Chambers June 27, 2024

Port efficiency gains can save 10,000 premature deaths annually

10 Jun 2024

https://www.drewry.co.uk/maritime-research-opinion-browser/maritime-research-opinions/port-call-optimisation-is-key-to-reducing-greenhouse-gas-emissions-in-ports

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Posted in Logistics, Ports, Shipping, Supply Chains

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A Story of Supply Chain Excellence

Posted on June 5, 2024 by | Leave a comment

Lora Cecere, the Supply Chain Shaman, is one of my favorite writers about supply chain issues. She’s always right on target with ideas and metrics that aid companies in the pursuit of supply chain improvements. And she’s the essence of simplicity; it’s never that complicated to do, though the ideas may embody complex interactions and reactions.

This article is an example. Lora and her assistant, Alex, put together some orbit charts to show how firms performed against the industry standard.

It’s a great piece of work. In the figure above, you can see that Lenovo is doing well on Inventory Turns, though not so hot on Operating Margin. And the recent trend is toward boosting margins but reducing inventory turns. The great thing about Lora’s charts is how they constructed the comparable business dataset to show us this comparison. Read the article for some details.

For those of you who don’t know about Orbit Charts, they are essentially connected scatterplots, with the connections covering a time dimension, so we see how the pattern changes over time. They are easy to make with most graphics software.

The Supply Chain Shaman’s analysis of the Gartner top 25 Award Winners is worth pursuing. It shows that there is more than one way to achieve supply chain and operational excellence.

Patterns Tell the Story of Supply Chain Excellence

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