Common Challenges in Ocean Shipping and How to Overcome Them
On June 22nd 2020, an improperly loaded barge sank 21 cargo containers into the ocean off the coast of Hawaii. While there were no injuries, this resulted in $1.6 million in damages.
Cases like this are not uncommon in ocean shipping. Unexpected challenges can lead to financial losses and delays. Understanding these challenges can better prepare you to navigate the complex world of ocean shipping. In this blog, we will examine some common challenges faced in ocean shipping and explore effective strategies for overcoming them.
What is Ocean Shipping?
Ocean shipping, also known as maritime or sea freight, refers to transporting goods and commodities via ships across oceans and seas. It is a fundamental component of global trade, aiding the movement of goods between countries and continents. Ocean shipping involves loading cargo onto ships at ports, transporting it across water bodies, and unloading it at the destination ports. It equally plays a vital role in the global economy, offering a cost-effective and efficient way of transporting large goods over a long distance.
Here are some of the common challenges faced in ocean shipping:
Unexpected Loss or Damage
The World Shipping Council (WSC) reports an average of 1382 containers are lost at sea annually. These numbers represent goods being waited for in different parts of the world that never reached their destinations. While the WSC works tirelessly to reduce the number of containers lost at sea by implementing stronger safety measures, these losses are still imminent.
It is important to note that cargo loss or damage can happen due to different factors, ranging from natural elements to human error. Understanding these potential risks is important as it helps you do your part to ensure your container arrives.
Natural Elements: Rough seas, adverse weather conditions, and natural disasters such as storms or tsunamis can jeopardise the safety of cargo ships. The violent motion of the ocean can lead to shifting and even loss of cargo if not properly secured or protected.
Improper Packing: Items not properly packed or secured within containers can lead to loss and damage. Insufficient cushioning can cause items to shift during transit, leading to breakage.
How to Overcome Unexpected Loss or Damage
One of the most effective ways to overcome this loss or damage is cargo insurance. This covers loss or damage to goods during transit, offering peace of mind and reducing financial risks. It ensures that in the event of an incident, whether due to natural disasters, accidents, or other perils, you can recover the value of the lost or damaged cargo.
Here are some of the standard insurance options and coverage types for cargo:
All-Risk Coverage: All-risk cargo insurance offers the broadest coverage, protecting against various perils, including natural disasters, accidents, theft, and mishandling. This coverage provides comprehensive protection for cargo from origin to destination.
Named Perils Coverage: Named perils insurance only covers specific risks listed in the policy. Common named perils include fire, theft, collision, and vessel sinking.
Total Loss Coverage: Total loss coverage compensates you if the entire cargo is lost or destroyed during transit.
Excess Coverage: Excess cargo insurance provides additional coverage beyond the limits of primary insurance policies. You can purchase excess coverage to supplement your existing insurance and increase protection against potential losses.
Specific Cargo Coverage: Some insurance policies offer specialised coverage tailored to the unique needs of particular cargo, such as hazardous materials, perishable goods, or high-value items.
On the part of the WSC, they are working to ensure that container losses are at zero, and this can be seen in a quote made by the CEO:
“Container vessels are designed to transport containers safely and carriers operate with tight safety procedures, but when we see numbers going the wrong way, we need to make every effort to find out why and further increase safety. The liner shipping industry’s goal remains to keep the loss of containers as close to zero as possible. We will continue to explore and implement measures to make that happen and welcome continued cooperation from governments and other stakeholders to accomplish this goal,” John Butler, President & CEO of WSC.
Inability to Track the Shipment
As someone who buys food a lot, one of the things that makes the experience worthwhile for me is tracking the dispatch rider every time to see where they are and how soon I’ll be getting my food. While tracking has made a difference in other aspects of shipping and logistics, the ocean shipping industry still struggles with accurate tracking.
The traditional method has been to send updates at every point of the shipping journey, e.g., the ship just left a certain port and is arriving at another port. However, this method lacks the visibility and responsiveness needed to keep you updated about your container, and any unexpected disruptions or deviations from the planned route may go unnoticed until it's too late, leading to delays and potential losses.
How to Overcome Inability to Track the Shipment
The advent of real-time container tracking technology using advanced IoT (Internet of Things) devices and GPS technology is changing the ocean shipping industry. This technology makes it possible to get accurate data into the whereabouts of your cargo at all times, offering a beacon of hope in the often unpredictable world of ocean shipping. Some of its benefits include:
Visibility: It allows you to monitor your cargo's progress in real-time and anticipate any potential issues before they escalate. This approach enables quicker decision-making and more effective problem-solving.
Faster Response: Real-time tracking technology enables faster response to issues that may arise during transit. Whether it's a mechanical malfunction, adverse weather conditions, or rerouting, you can promptly identify and address any problems.
Let’s say your cargo is expected to arrive in four days, and you have eager customers waiting to get some items. However, a detour was made, and the cargo will be late by three days. Knowing this, you can quickly send a message to your customers informing them of a slight delay. Upfront communication like this helps improve customer experience and satisfaction.
Better Collaboration: Besides improving visibility and responsiveness, real-time container tracking technology facilitates better collaboration and communication among participants involved in the shipping process. Access to accurate, timely information promotes transparency and trust between shippers, carriers, and recipients. This, in turn, promotes smoother operations, reduces misunderstandings, and strengthens partnerships within the industry.
Delay in Arrival
A popular quote says, “Delay is not denial.” But the delays in ocean shipping beg to differ. They have been a persistent challenge that has affected the operations of several businesses, leading to missed deadlines, disappointed customers, and increased costs. These delays are often caused by port congestion, adverse weather conditions, and mechanical issues, and they can impact your business if not managed effectively.
Port Congestion: One of the primary contributors to delays is port congestion, which occurs when a high cargo volume surpasses the ports' capacity. This congestion can result from labour strikes, inadequate infrastructure, or simply an influx of shipments exceeding the port's capacity, especially during peak seasons.
Bad Weather: Weather conditions, such as hurricanes, storms, or heavy fog, can disrupt shipping schedules and pose significant risks to vessels and cargo. Very bad weather conditions force ships to alter their routes, slow down, or even seek shelter until conditions improve, leading to delays in arrival at the destination port.
Mechanical Issues: Mechanical problems, such as engine malfunctions or equipment breakdowns, can cause unexpected delays. These issues often require time-consuming repairs, resulting in delays in the shipping schedule and potentially impacting the delivery of goods.
How to Reduce Delays
Flexible Booking Options: To reduce these delays, you can opt for a flexible shipping option offered by shipping companies. This allows you to book cargo on different vessels that are moving at the same time. So, if one breaks down or encounters a delay, you can transfer your cargo to another ship.
Alternative Routes: You work with freight forwarders to identify alternative routes offering shorter transit times or fewer congestion-related issues.
High Costs, Charges, and Taxes
In ocean shipping, expenses can quickly add up, impacting your business's bottom line. Understanding the breakdown of these costs and implementing strategies to manage them efficiently is essential for companies to stay competitive and profitable.
Components of Ocean Shipping Costs
Ocean Freight Rates: These are the base costs carriers charge for transporting goods from one port to another. Factors such as distance, volume, and cargo type determine the rate you will be charged.
Bunker Charges: These charges cover the cost of fuel used by vessels during transit. Fluctuations in fuel prices can increase bunker charges and overall shipping costs.
Terminal Handling Fees: Fees charged by terminals for services such as loading and unloading cargo, storage, and documentation processing.
Strategies to Manage Costs
Negotiate Rates: You can negotiate with carriers to secure favourable freight rates based on factors such as volume, frequency of shipments, and long-term contracts.
Utilise Consolidation Services: Consolidating shipments with other cargo can help reduce costs by maximising container space and sharing transportation expenses. Also known as Less-than-container loading (LCL), you can share container spaces with others not using full containers to ship their items.
Optimise Packaging: Efficient packaging design can help reduce the weight and volume of shipments, lowering transportation costs. Using lightweight materials and compact packaging can lead to significant savings over time.
RELATED: How Ocean Shipping Saves You Money
Incorrect Documentation
Incorrect documentation can hinder the smooth flow of ocean shipping operations. Accurate and complete shipping documentation is necessary to ensure an easy customs clearance, essential for timely delivery.
Customs clearance verifies if the imported and expected goods comply with the regulations of the destination or origin country. Proper documentation provides customs officials with the necessary information to assess duties, taxes, and any restrictions or rules associated with the shipment.
Documentation Errors and Consequences
Common documentation errors include incomplete or inaccurate information regarding the goods' nature, quantity, value, and origin. Any difference in details can result in customs officials conducting further inspections or requesting additional documentation.
Without the correct paperwork, goods may be held up at customs, leading to delays in delivery, potential financial penalties or seizure of goods.
How to Manage Documentation Errors
Freight forwarders are important in ensuring proper documentation for ocean shipments. These intermediaries specialise in managing the logistics of international freight transportation, including preparing and processing shipping documentation. Through their expertise and network, freight forwarders can help you navigate complex customs requirements and minimise the risk of documentation errors.
A New Partner on the Ocean Waves
Navigating several challenges is the norm in ocean shipping, and you cannot do this alone. You need a reliable carrier/ partner who understands your business needs and ensures they are met. This is where Heroshe’s ocean shipping service comes into play.
With a deep understanding of the complexities of global logistics, Heroshe is committed to providing tailored solutions that cater to your unique needs. Here are a few reasons you will love ocean shipping with Heroshe:
Affordability: We pride ourselves on offering cost-effective shipping solutions without compromising quality. You can enjoy a premium shipping service for as little as $2 per pound.
Flexibility: We recognise that every business has distinct requirements, so we offer flexible shipping options tailored to meet those needs. Whether you make bulk or individual shipments, our service accommodates your order.
Tracking: We understand that you need to stay updated about the whereabouts of your package at all times. Our advanced tracking technology lets you monitor your shipments in real time, providing peace of mind.
Bulk Shipping/Consolidation: We offer bulk shipping and consolidation services for businesses looking to streamline logistics operations and reduce costs. By consolidating different shipments into one container, we can save space and reduce shipping expenses.
RELATED: Ocean Shipping vs. Air Freight - Which is the Best Choice for Your Business?
Ready to Overcome the challenges of ocean shipping? Heroshe's ocean shipping service is designed to help businesses like yours navigate these challenges and ensure their goods reach their destinations safely and on time. Sign up now and enjoy love and swift delivery with Heroshe.
Frequently Asked Questions (FAQ) about Ocean Shipping with Heroshe
What is the typical timeline for ocean shipping with Heroshe?
Ocean shipping offers cost-effective transportation solutions but typically takes longer than air freight. Shipments from our Houston warehouse to Nigeria generally take 12-14 weeks to arrive. This timeline can vary depending on customs clearance and weather conditions.
What is the shipping schedule for ocean shipments?
Unlike air freight, ocean shipments from our U.S. warehouse do not occur weekly on Thursdays. However, you can easily access the shipping schedule on your dashboard, which allows you to plan your shipments accordingly. Additionally, we'll keep you updated about shipping schedules via the Notifications tab on your dashboard.
Where are your current warehouse locations for ocean shipping?
Currently, ocean shipping services are available exclusively from our U.S. Houston warehouse.
How much does it cost to ship via ocean with Heroshe?
Our ocean shipping service costs $2 per pound. We aim to provide transparent pricing to our customers to help them plan and budget their shipments effectively.
