Exporters wary of shipping dependency, study finds
comes to choosing shippers, according to an industry survey.
The survey, by Unisys, indicates that exporters are still wary of becoming dependent on one shipper, despite the billions spent by the industry on consolidation in the name of efficiency and better customer service.
Shipping includes moving goods by air, sea or land.
Unisys found that almost three-quarters of large exporters would rather do business with several shipping providers than centralize their operations with one major supplier.
The survey asked exporters questions relating to logistics services, information technology, security and regulations.
Unisys found that 70 percent of those surveyed answered "no" when asked whether they expected to move to a "one-stop shop" provider.
"Rather, many respondents indicated that they had an intentional, specific logistics strategy to diversify their business among multiple providers so as to encourage competition and lower prices," Unisys said.
Respondents felt that multiple suppliers keep prices and services competitive, and that often niche logistics providers deliver a better service, communicate faster, and are more flexible.
"These survey results demonstrate that costs and reliability are key priorities for shippers, so they understand the best services and modes to use for their business," stated Christopher Shawdon, vice president for Unisys' logistics unit.
Unisys surveyed senior management from 52 major global corporations in industries such as technology, pharmaceuticals, food and retail.
One of the biggest concerns revealed in the survey is over fuel costs and whether exporters would have to switch to shipping by sea.
Shipping customers are concerned that increasing fuel costs will force them to consider other alternatives, such as diverting air freight to the sea, Unisys found.
The switch would be made as a way to offset the rising costs of moving goods through the supply chain.
When asked what would drive them to use more air cargo, three-fourths of respondents surveyed said the cost would have to come down before they make the switch.
The survey also found that the rush to Asia is squeezing air capacity.
The peak season surge in air traffic continues to be a significant problem for companies who have shifted their manufacturing or suppliers to Asia, Unisys found.
Survey participants expressed mixed support for making long term capacity agreements to ensure their goods get to Asia.
Respondents overall felt that the bigger a logistics provider was, the less flexible and user-friendly its systems were, according to the survey.
They were generally satisfied with the real-time information received from integrators and perceived them to have an IT advantage with one company managing the information chain.
While most believed in improved IT security, many expressed concern about the increasing thicket of regulations they have to follow along the supply chain.
They pinpointed anti-terrorism security and related regulatory requirements as putting the most pressure on their supply chains.
"However, they were resigned to the fact that security and regulations are here to stay and will likely continue to become more stringent," Unisys said.
The majority of respondents also felt that IT helped move things through the supply chain faster. The faster shipments moved, the less chance there was that goods would be stolen, they said.
The companies in the survey have, on average, annual global sales of $28bn and annual intercontinental transport expenditures of $150m.
Unisys will make public the more extensive survey findings at a seminar in Nice, France, 3-6 October.
