From Chaos to Cohesion: How Ocean Consolidation Reshapes Supply Chain Management
The shipping industry has
undergone many challenges, and hurdles in ocean freight are no exception. If
you look into the past, many carriers lost their independence, and only a few
carrier alliance groups were left. Consequently, businesses had to bear the
hefty cost, limited options, and decreased customer service. Since global trade
is essential for most manufacturing sectors, companies had no choice but to
face the challenging environment.
Ocean consolidation came as
a solution to overcome these complexities. However, people faced many
difficulties due to hefty pricing, limited availability of carriers, poor
management, time scheduling, and so on. With the passage of time, the supply
chain industry has resolved all such issues. Today, ocean consolidation has
become a mandatory option for many businesses.
Let’s try to discover ocean consolidation and how it reshapes supply chain management.
Ocean Consolidation Freight Services
Ocean freight consolidation
utilizes a single container for multiple LCL (Limited Container Load)
shipments. Here, shipments are grouped and sent through a single container
instead of using different containers for different shipments. With each
passing day, this practice is gaining tremendous popularity.
Depending upon the needs,
businesses can choose from the various types of consolidation services.
Multi-stop consolidation is a practice in which the carrier stops at multiple
destinations. Another option is temporal consolidation, in which the carrier waits
for all shipments. Terminal or facility consolidation is also an option, in
which small shipments are sent to the transshipment centers, from where they
get merged with the larger loads.
Today, due to advancements
in technology and the availability of resources, businesses get options like
premium carriers, direct sailing, minimum lead time, and so on.
Ocean Consolidation and Supply Chain
Management
Undoubtedly, ocean
consolidation is reshaping supply chain management. However, the practice of
consolidation in ocean freight was not free from challenges. Many companies
faced difficulties in deciding an ideal route for the vessel in case of
multiple stops. Likewise, they had to determine the waiting time for other
shipments in case of temporal consolidation. The planning related to the
transshipment ports also involved considering various factors, making this
process complex and troublesome.
Thankfully, the system has
revolutionized, and prompt solutions to every problem are available. Today,
this service assists a wide range of businesses in streamlining the production
process and ensuring timely deliveries without bearing heavy expenses. At the
same time, the practice has also intensified competition in the business
landscape, where more and more companies are running to achieve
efficiency.
Dynamic
World Wide Logistics Group helps you
stay ahead of the curve through direct ocean consolidation services. With a
vast network, negotiation skills, and audits, we give you the best and safest
option.
Benefits
Let us now understand the
core benefits that ocean consolidation offers. Some of these benefits
include:
Cost Minimization
Reduction in cost is one of
the golden benefits of ocean consolidation. Without consolidation, you have to
pay the whole vessel charges; even if your goods are less than the capacity of
the vessel. However, in consolidation, sharing the vessel means sharing the
cost. Shared capacity reduces the per unit cost of the goods, making it
possible for businesses to minimize shipment expenses.
Not only is this, but this
facility enables businesses to send even small shipments. It means that it
reduces the cost of storing goods and warehouse rent. You no longer need to
wait for the total capacity before sending the goods.
Better Utilization of Resources
Another benefit relates to
the utilization of available vessels. It is a process in which multiple sources
use the same container, with fewer chances of leaving empty space in the
containers. It is the reason why available containers become sufficient to
fulfil the needs of various businesses.
Shared Risk
Consolidation is not just
related to cost-cutting; it also helps reduce risk, which is otherwise higher
in separate shipping. These risks include the cost of theft, damage, or cargo
loss.
Moreover, the risk gets minimized as shipments go into less hands. It automatically reduces the chance of damage and theft. Besides this, it also reduces the chance of late deliveries due to something interrupting the delivery process.
Faster Delivery
When a vessel is full,
there is no need to stop at multiple destinations to pick up more shipments in
order to fill the capacity. Since the capacity is already full, route
optimization becomes possible, which helps businesses in getting goods on time.
Flexibility
Today, most businesses are
trying to enter multiple markets. This facility is beneficial for them as they
can send goods to various locations within a single vessel. They do not need to
negotiate repeatedly for the cost, spend time sending goods in separate
containers, and stay updated about multiple vessels reaching their destinations
at different times. Additionally, this benefit also serves as a motivation for
new businesses trying to enter more than one market at a time.
Consistent Schedule
The process enables you to
maintain consistency in shipment deliveries. No matter how many goods you have,
you can send them through consolidation, considering the delivery date. It
helps maintain a smooth production schedule and enhances relations with business
partners.
Consumer Satisfaction
All of the above benefits contribute to enhancing consumer satisfaction. Fast deliveries, minimal risk of loss, less probability of damage, and cost minimization help make consumers happy. Even if you send goods to retailers or partners, on-time deliveries will speed up the process of sending goods to the final consumers. And cost minimization helps in reducing or maintaining prices instead of increasing them.
Wrapping It Up
From the above points, it
is evident how ocean consolidation is playing a vital role in fulfilling
business needs. With time, technology is bringing more progression to the
process, increasing the trend of using this service.
To know more about how it works, feel free to contact us. We have years of experience providing ocean consolidation services that can help you save time, cut costs, and develop a smooth transportation strategy.
