Faced with existential cost challenges, perishables shippers have welcomed the initiative of the Global Coalition of Fresh Produce (GCFP) to improve logistics flows through a charter of best practices – but some industry executives want better metrics to track carrier performance in order to make significant headway.
The GCFP’s latest survey, published last week, shows an industry in distress; where many operators are struggling with rising costs – from fuel and shipping over fertiliser to plant protection products and packaging, with 85% reporting higher costs in each of these categories.
Nearly two-thirds of respondents saw costs rise 10% or more, and one in seven reported increases in excess of 50%. Most struggle to pass the higher costs on to customers, and almost two-thirds consider their medium-term economic sustainability threatened.
At the Fruit Attraction event in Madrid this month, the GCFP unveiled its charter of best practices, which aims for a collaborative approach by all participants in produce supply chains. ( See Produce shippers prepare best practice charter for transport – The Loadstar)
It espouses collaboration and communication, fair and transparent business terms, competition and efficiency, cargo integrity and product quality, supported by optimal handling, resilience, and risk preparedness.
The charter was well received at the event, but some found it did not go far enough to bring about a transformative change. Edouard Brière, founder of Trackberry, a container tracking and document automation platform for fresh produce importers, called it “a welcome step forward”, but added that it needed importer-focused measurements to succeed.
He highlighted ocean carrier schedule reliability, arguing that ETA at destination port was a metric that missed the impact of schedule changes on the importer. Whether or not a vessel arrived technically on time is irrelevant if the imported container is not ready to move at the time the importer planned – be it due to schedule updates during transit, late arrival of documentation, or other factors.
To a large extent, the problem lies in communication, he believes.
“The recurrent frustration [for importers] is not that a ship is late. It’s that they find out too late to do anything about it,” Mr Brière added.
He pointed out that failure to have the container ready to go as planned rapidly piled up costs for importers – for storage at the port and electricity to power the reefer, for a wasted truck journey and warehouse costs. However, these pale in comparison to penalties for missing deadlines buyers set to sell the produce during a planned window, and lost business down the road.
What matters to the importer is how close the arrival was to the arrival estimated a week ahead, how often that estimate changed, how late the importer was informed about this, and whether or not the documents required for clearing the shipment arrived ahead of the cargo, he argued.
According to him, measuring carrier reliability should not be difficult for the GCFP. All that would be needed is a container number and its promised departure and arrival dates, he suggested, adding that importers could track shipments per lane and carrier to monitor how expected time of arrival strays from the schedule they had been given.