COVID-19 did much more than expose human frailty and the power of a fast-spreading virus. The pandemic hit the transportation industry hard, and many shippers are beginning to breathe a sigh of relief as recovery from the chaos continues. Thankfully, the disruptions to the supply chain we all experienced are easing a bit as demand begins to slow. But in uncertain times, shippers need any leverage they can get. Any help with forecasting, strategy, and carrier relationships is welcome. These challenges may indeed seem daunting at first blush, but let’s take a closer look and see how using the right technology can overcome them.
The Key Challenges Facing Today’s Ocean Container Shippers
Despite this well-deserved respite from the supply chain struggles, ocean shippers still face significant challenges, chief among those being gridlock due to worker shortages and limited receiving hours, the pressures inherent in supporting environmental, social, and governance goals, the rise of big-time B2C omnichannel e-commerce carriers, global supply chain congestion, and the rise (and dominance) of less-than-truckload (LTL) carriers.
West Coast Labor Negotiations
Let’s begin with the high-stakes labor landscape. A widely reported rail strike nearly shut down rail shipping back in 2022. The House passed legislation that would force a tentative rail labor agreement and thwarted a national strike. And another House vote added seven days of paid sick leave to the agreement (instead of one). President Biden and the House and Senate leaders met to discuss how to avoid the economic impacts of a rail strike, which could cost the U.S. economy $2 billion daily.
And 350,000 UPS workers could strike this summer if a new contract agreement isn’t reached on time, threatening the delivery of millions of parcels. UPS workers are taking a hardline stance on pay, scheduling, and other issues ahead of negotiations for a new contract. The current contract expires on July 31.
In another realm of shipping, the International Longshore and Warehouse Union (ILWU) and the Pacific Maritime Association (PMA) are negotiating a new labor agreement for the more than 22,000 dockworkers at all 30 U.S. West Coast ports. The risks are apparent: potential West Coast port shutdowns and a national supply chain disruption.
As a result of ILWU negotiations, volumes are shifting east. Since the pandemic, the West Coast’s ills have become the East Coast’s gains. Overall, top ports on the East and Gulf coasts handled 54.9% of inbound volume in December 2022, with the West Coast share down to 45.1%. Initially, the shift was to minimize the effect of congestion delays on the West Coast. Most recently, this related to the concern of disruption from the aforementioned potential labor unrest.
Persistent Port Congestion
While port congestion has fallen significantly from the stratospheric heights reached during the pandemic, it remains a persistent source of supply chain disruption. The back-and-forth of overtaxing to relieving gridlock in ports is creating a see-saw effect. For instance, only 27 ships sat at anchor off Los Angeles-Long Beach this past October. Still, cargo diverted to the East Coast in anticipation of a longshore strike now strains capacity at the ports of Savannah, New York-New Jersey, and Houston. According to Drewry Shipping Consultants, congestion still ties up 15% of adequate capacity on North American trade lanes. And worker shortages continue to slow down supply chains.
Worker Shortages Slow Down Supply Chains
According to a report from Transport Dive, the shipping industry is short about 78,000 drivers; however, this is an improvement over last year’s more than 80,000-person gap estimate. Carriers raised pay for more than 90% of drivers in 2021 to combat the shortage. The improvement is expected to be temporary, though, given that an aging workforce and freight demand are both projected to grow. The answer? According to the American Trucking Association (ATA), the industry must recruit nearly 1.2 million drivers over the next 10 years to replace departing drivers and avoid the driver shortage potentially ballooning to more than 160,000 by 2031.
But there’s also a warehouse workers shortage. The warehouse is the “last mile” of the supply chain. Last mile delivery is on the rise in use, according to OneRail. As we all know, it is a complicated and labor-intensive network of steps – from sourcing materials, refining them, and delivering them to manufacturers so they can build products to getting the products to distributors and customers. Modern warehouses are using automated guided vehicles (AGVs) and autonomous mobile robots (AMRs) to meet fulfillment demands. One key issue driving AMR adoption is the previously cited labor crunch. According to the Bureau of Labor Statistics, annual turnover rates in manufacturing were close to 40% in 2021 and even higher in warehouses (49%). Given how rapidly the workforce is aging, the labor shortage is a reality that warehouse managers will continue to face.
All of this can slow down port performance by affecting drayage and warehousing practices. Often described as the “first mile” of transporting goods over short distances, drayage is the transport of freight from an ocean port to a destination. While all drayage loads tend to originate at a port of entry, there can be several legs of a drayage load (port, yard, warehouse, rail) before the container arrives at its final destination. Drayage is also big money. For example, as the gateway to the Asia trade market, the San Pedro Bay Complex (LA and Long Beach) is a $60B a year industry, over one-quarter of the total container trade in North America. Major delays, driver frustration, financial penalties, and missed deadlines are key factors and pain points in dealing with drayage loads.
How Does Ocean Container Tracking Help Shippers Prepare for the Difficulties of 2023?
As evidenced by these myriad issues facing modern shippers, it’s never been more challenging for shippers to simply know where their ocean freight is, when it will arrive, and why it was delayed. Shippers desperately need improved accuracy in ETAs and real-time container tracking with container numbers or bills of lading. With these in hand, shippers can closely monitor shipments and make last-minute supply chain decisions to ensure OTIF (on-time and in-full) delivery.
VIZION API provides real-time container tracking visibility to shippers, logistic service providers, and other stakeholders. VIZION API automatically pushes the most complete, standardized, and detailed container tracking events to any software system or spreadsheet, giving you end-to-end visibility into the freight that drives your business.
With VIZION API, you can track shipments by container number, Master Bill of Lading, or Auto Carrier Identification:
- Track 98% of global shipments via Carrier List
- Instant On, flexible data access with documentation
- Immediately begin tracking by Container Number or Master Bill of Lading
- Industry-leading data quality + transparency
- 99+% Standardization of Raw Carrier events + AIS data
- 7,000+ unique events turned into 60 standardized milestones, and ETAs
- Enrichment of multiple data sources (EDI, API, web scrape, AIS, rail, Terminal websites) offers the most complete picture of container updates
- Data feeds are refreshed multiple times daily to minimize latency
Standardized Data Brings Order to Chaos
Analytics plays a crucial role in ocean container tracking, providing real-time data on containers' location, contents, and condition. This data can be used for a number of things: to optimize shipping routes, improve supply chain efficiency, and reduce costs, to name a few.
Creating an optimized supply chain requires identifying areas of your supply chain where there is room for improvement. Leveraging container shipping data and other big data analytics in the shipping industry is a great place to start.
A carrier scorecard built using KPIs based on container shipping data can be a valuable tool for helping you better manage your carrier relationships. For instance, when you notice an issue with a certain aspect of a carrier's performance — and have the data and shipping analytics to prove it — it becomes much easier to hold your carrier partners accountable. Or, if you know that a carrier had a high rate of damaged shipments during your prior agreement with them, you may be able to use your collected shipping information to negotiate a lower rate for your next contract.
KPIs are also great for assessing the performance of ports, ground freight carriers, and air freight carriers. Tracking KPIs helps you cut through the chaos, ensuring you remain aware of any issues or inefficiencies holding back your supply chain.
Port and Terminal Connection Updates Keep Shippers in the Know
Shippers are turning to technology to avoid steep demurrage and detention fees in a supply chain still affected by port congestion.
Shippers using VIZION can automatically push container-related Port & Terminal events like Last Free Data and Available for Pickup to their transportation management system (TMS), enterprise resource performance (ERP) system, or other core business software.
Last Free Date Alerts
All ports and terminals give shippers a certain number of days to pick up containers before demurrage charges start. VIZION’s Last Free Date event automatically alerts you when those charges will begin so you can coordinate pickups with your drayage providers.
Available for Pickup Notifications
Shippers must clear all fees and know their containers’ locations before arranging pickups. VIZION’s Available for Pickup event enables you to eliminate time and money wasted when drayage providers arrive at ports and terminals before containers are ready.
Leverage Events for Visibility
Maximize visibility by using Port & Terminal Events in tandem with other events that share when containers discharge from vessels, gate-out of ports, return empty, and more. These events collectively give you enhanced visibility into your supply chain.
Gain Peace of Mind in Turbulent Times with VIZION
In summary, it’s clear that a key for shippers to breathe that well-earned sigh of relief, to get to a point at which they feel they have done all they can do to safeguard against and overcome the many challenges they face today – gridlock due to worker shortages and limited receiving hours, global supply chain congestion, and more – is to adopt and embrace the technology available to them. Most notably, shippers need the innovations available that offer shippers accessibility to data, visibility into that data, and the decision-making power that analysis of the data affords them.
With VIZION, these innovations can be accessed through a single cloud-based platform, streamlining access to vital ocean container tracking information. From improved accuracy in ETAs and real-time container tracking with container number or bill of lading to standardized data that helps you rise above the chaos, to Port & Terminal updates that keep you in the know,
VIZION’s services are the leg up every shipper needs to conquer all the challenges they can and will encounter.
Talk to an expert or book a demo with VIZION today.
