Global Ocean Freight e-sourcing 2017/18.
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- Letitia Parks
- 5 years ago
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4 What in your experience are retailers top priorities and why? How retailers should approach their negotiations and other relationship aspects with ocean carriers? How can retailers leverage ocean transportation to make themselves more competitive in an increasingly e-commerce and multi-channel environment? What are retailers particular challenges right now (new carrier alliances, higher rates, etc.) and how will these challenges evolve over the next few years? What are examples from your experience of truly successful retailer carrier engagement? How can retailers maximize the effectiveness of their use of ocean transportation How should forwarders most optimally fit into a carrier s ocean strategy?
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7 What in your experience are retailers top priorities and why? How retailers should approach their negotiations and other relationship aspects with ocean carriers? How can retailers leverage ocean transportation to make themselves more competitive in an increasingly e-commerce and multi-channel environment? What are retailers particular challenges right now (new carrier alliances, higher rates, etc.) and how will these challenges evolve over the next few years? What are examples from your experience of truly successful retailer carrier engagement? How can retailers maximize the effectiveness of their use of ocean transportation How should forwarders most optimally fit into a carrier s ocean strategy?
8 What in your experience are retailers top priorities and why?
9 What in your experience are retailers top priorities and why The merchandise has to move AND on time Certainty is a primary concern, along with Visibility to that all important data Fastest time door to door, High value = inventory carrying costs
10 What in your experience are retailers top priorities and why The merchandise has to move AND on time Certainty is a primary concern, along with Visibility to that all important data Fastest time door to door, High value = inventory carrying costs I want to know that the order is moving on time AND IS complete
11 What in your experience are retailers top priorities and why The merchandise has to move AND on time Certainty is a primary concern, along with Visibility to that all important data Fastest time door to door, High value = inventory carrying costs I want to know that the order is moving on time AND IS complete When will it ship ex origin, AND When will it arrive at destination?
12 What in your experience are retailers top priorities and why The merchandise has to move AND on time Certainty is a primary concern, along with Visibility to that all important data Fastest time door to door, High value = inventory carrying costs I want to know that the order is moving on time AND IS complete When will it ship ex origin, AND When will it arrive at destination? Where is it now AND How much will it cost? I don t want to re negotiate every time I have an urgent shipment in peak
13 How retailers should approach their negotiations and other relationship aspects with ocean carriers Remember there are only 2 reasons to go to bid, - To lower your costs, and to improve your service, nobody goes to bid to pay more!!!! The 2016 and 2017 ocean and to an extent air negotiations, were clearly biased towards the BCO, massively lower port-port and airport to airport costs than in previous years, on almost all trades, BUT the wake up call is already being heard, so from a strategic standpoint, timing is everything----- going forward to 2018 your last years strategy will need either some tweaking or a complete re-think.!!
14 Your Annual Bid Process must be Strategically Orchestrated
15 I want to make sure that the deals I made in contract will be honored
16 OCEAN CONTRACT PERFORMANCE CLAUSES In the event of changes by Carrier to Alliance membership, cancellation of published sailings, ports of exit and arrival, quoted and agreed transit time, quoted routing and string names, quoted % of containers to be shipped on a named ocean carrier within your Alliance, quoted % of on time performance ETCETC, shipper reserves the right to adjust the MQC accordingly Locking down the Agreement Ocean Contract must have s.
17 How retailers should approach their negotiations and other relationship aspects with ocean carriers Some provider relationships now canceled, Your buddy from APL, OOCL, CSCL, H SUD may no longer be there, maybe they were 4 of your top 5 carriers last year!! BUILD NEW RELATIONSHIPS AT A SENIOR LEVEL, and below Consider the total cost of ownership, TCO, and understand the things that just happened for you before in previous relationships, may now have to be re understood, back to the drawing board, and re engineered Implementing new Service providers is not an overnight job time, effort and $$ New SOP s have to be drawn up, the business transitioned from one provider to another and then Implemented, need resources & expertize
18 What in your experience are retailers top priorities and why? How retailers should approach their negotiations and other relationship aspects with ocean carriers? How can retailers leverage ocean transportation to make themselves more competitive in an increasingly e-commerce and multi-channel environment? What are retailers particular challenges right now (new carrier alliances, higher rates, etc.) and how will these challenges evolve over the next few years? What are examples from your experience of truly successful retailer carrier engagement? How can retailers maximize the effectiveness of their use of ocean transportation How should forwarders most optimally fit into a carrier s ocean strategy?
19 How can retailers leverage ocean transportation to make themselves more competitive in an increasingly e-commerce and multi-channel environment? So what to do from a retail or e-tail perspective, nobody wants to hear, Oh we saved $200 a container, when the product either did not ship on time, was offloaded in Busan, or is arriving late, missing potential street value sales of $1m+. The priority is Performance, or BEST POSSIBLE SERVICE AT THE LOWEST POSSIBLE COST So how do I engage with providers that can deliver on their promises, know how to deliver value not freight rates, and are less likely to go bankrupt or be gobbled up in the next couple of years, as we said before This is a new Ball Game. The rules are still being written as we speak.
20 How can retailers leverage ocean transportation to make themselves more competitive in an increasingly e-commerce and multi-channel environment Negotiate from strength at a Senior level, global MQC s, prove your track record Always provide real rolling forecasts, build those into your Negotiated contracts Study transits and reliability, build those KPI s into your Negotiated contracts Understand Risk and Reward, honor your agreements, Option for bonus/malus Measure performance, lifting reports, and real on time data Consider Bimco ServiceCon contract for standardization & performance criteria Deliver the goods, BUT Always have Plan B Make your Company a PRIORITY for all Service providers
21 What in your experience are retailers top priorities and why How retailers should approach their negotiations and other relationship aspects with ocean carriers How can retailers leverage ocean transportation to make themselves more competitive in an increasingly e-commerce and multi-channel environment? What are retailers particular challenges right now (new carrier alliances, higher rates, etc.) and how will these challenges evolve over the next few years? What are examples from your experience of truly successful retailer carrier engagement? How can retailers maximize the effectiveness of their use of ocean transportation How should forwarders most optimally fit into a carrier s ocean strategy?
22 What are retailers particular challenges right now (new carrier alliances, higher rates, etc.) and how will these challenges evolve over the next few years? Consumers have choices, at the touch of a button, but..so do you Less Alliances make your choice easier.for now, check primary/secondary #JusteBidit, annual, global, performance driven, good analytics of data is key Competition is within Alliances, BCO will now award per Alliance Get inside the providers organization at every level If you promise to deliver then so does your provider, contractually Performance is key, secure commitment to perform, and measure Don t get caught up in Providers contract format, opt out clauses essential Keep abreast of all markets, provider Financials, ports/terminals
23 What in your experience are retailers top priorities and why How retailers should approach their negotiations and other relationship aspects with ocean carriers How can retailers leverage ocean transportation to make themselves more competitive in an increasingly e-commerce and multi-channel environment? What are retailers particular challenges right now (new carrier alliances, higher rates, etc.) and how will these challenges evolve over the next few years? What are examples from your experience of truly successful retailer carrier engagement? How can retailers maximize the effectiveness of their use of ocean transportation How should forwarders most optimally fit into a carrier s ocean strategy?
24 What are examples from your experience of truly successful retailer/carrier engagement? Understand - No such thing as a WIN/WIN in Ocean contracting Deliver on your promises, no extras at Check Out, on either side Have seasoned negotiator experts on your side of the table,. be strategically professional KNOW that your providers were successful Don t let providers take your eye off the ball, throughout the supply chain Reward good service Never over commit volume, use the 70/30 rule + Plan B Airfreight!! Make the responsibility known across all providers and inside your Team and at your Suppliers
25 What in your experience are retailers top priorities and why How retailers should approach their negotiations and other relationship aspects with ocean carriers How can retailers leverage ocean transportation to make themselves more competitive in an increasingly e-commerce and multi-channel environment? What are retailers particular challenges right now (new carrier alliances, higher rates, etc.) and how will these challenges evolve over the next few years? What are examples from your experience of truly successful retailer carrier engagement? How can retailers maximize the effectiveness of their use of ocean transportation How should forwarders most optimally fit into a carrier s ocean strategy?
26 How can retailers maximize the effectiveness of their use of ocean transportation Air freight is a strategic weapon, a competition beater Have Options A, B, C and what if mapped out in advance Understand ALL options, routings, strengths & weaknesses & costs, door to door 2 sets of eyes better than one, use forwarder, infomediary to monitor events Don t risk hot items to save $200, go faster, better and in the long run cheaper Make sure empty equipment is available, when you need it Plot performance of ports and terminals that provider is using Never forget the 6 Golden rules of Negotiating
27 What in your experience are retailers top priorities and why How retailers should approach their negotiations and other relationship aspects with ocean carriers How can retailers leverage ocean transportation to make themselves more competitive in an increasingly e-commerce and multi-channel environment? What are retailers particular challenges right now (new carrier alliances, higher rates, etc.) and how will these challenges evolve over the next few years? What are examples from your experience of truly successful retailer carrier engagement? How can retailers maximize the effectiveness of their use of ocean transportation How should forwarders most optimally fit into a carrier s ocean strategy?
28 How should forwarders most optimally fit into a carrier s ocean strategy??
29 RECAP Know your business needs for the year ahead The merchandise has to move AND on time, Visibility is key Timing is everything, negotiate from strength Deliver on your promises, remember the 70/30 rule This years negotiations will be different Make yourself known to providers at a senior level Lock down performance clauses in your contracted agreements Reward good service Airfreight is a strategic weapon Never forget the 6 Golden Rules of Negotiating
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