One of the best options for transporting goods is by water, water transportation is the cheapest transport service available. At the peak of COVID-19, it was once more the option that was most preferred because there were the least restrictions. The problem that arises is the huge turnover of ships, which creates congestion in various ports.
Port congestion occurs when a ship arrives at a port to load or unload cargo but is unable to berth, forcing it to wait at the anchorage, and causing what appears to be traffic. And leading to delays, increased costs, and logistical headaches for businesses involved in international trade. These daily issues continue to affect ocean shipping and require some action. Port congestion is a significant challenge that affects the work of freight forwarders worldwide.
The Impact of Port Congestion on Freight Forwarders
Freight forwarders play a crucial role in the logistics supply chain, as they are responsible for managing the movement of goods from origin to destination. However, when ports become congested, their work becomes more challenging. Therefore, the most important steps here are: First, the shipping companies explain all the challenges; and second, to find the optimal solution to each problem.
What are the main problems facing freight forwarders related to port congestion?
Congestion in ports is a serious problem for the timely execution of shipments. The transportation of the goods to the end customer is delayed, hence their resale. The worse the implementation, the more sanctions and funds are lost. Every problem needs to be solved, but let’s look at the most important ones.
Here are the main problems for shipping companies:
1- Visibility of the shipment
This element is one of the most important in the transportation of goods. Freight forwarders face major concerns if shipping is delayed and shipment information is unavailable. Such concerns could not happen if freight forwarders use online freight solutions to track shipments. Traceability gives them peace of mind and a quicker response to deal with the situation.
Customs regulations are becoming more complex. The problem is that it takes a long time to unload the cargo due to the large volume of container ships. This affects the handling and approval of the cargo because it can take a long time, which will delay all logistics activities afterward. Freight forwarding companies are constantly looking for ways to receive adequate information about the status of the shipment at all times, and that can be easily solved by using freight forwarding software.
2- Unforeseen incidents
Freight forwarders are expected to respond precisely to problems related to the transport of containers, as well as their management upon arrival at the port. Every shipment, regardless of its nature and volume, faces different challenges when it travels. These unforeseen situations are not only unfortunate, but they can prevent them from arriving at the right time.
Each shipment has a value that is a complex of many variables. Thus, for example, the longer the containers stay in port, the more retention fees are paid, which reduces the goods’ value.
The other problem is that every freight forwarder is fighting the competition by trying to offer lower freight rates. This way, they can secure a lasting and long-term relationship through contracts. However, the greater the congestion in ports, the more often freight forwarders pay to keep their customers, and this is lost revenue for them. Therefore, a container tracking module integrated into freight software can save freight forwarders time and money.
4- Increased Costs
Port congestion often leads to increased costs, as freight forwarders must pay additional fees to expedite the movement of goods through the port. This can be especially challenging for small businesses that have limited budgets.
Congestion can also lead to significant delays in the movement of goods, which can impact supply chain schedules and delivery times. This can create frustration for customers and result in lost business for freight forwarders.
6- Limited Capacity
Congestion at ports can lead to limited cargo handling capacity, which in turn could result in restrictions on the kinds of goods that can be shipped or delayed loading onto vessels. This is why it’s important to plan ahead and ensure adequate resources are available when shipping goods.
How can freight forwarders overcome the challenges of port congestion?
As we have already mentioned, there are solutions to the problem of port congestion; they just need to be found. Of course, sometimes traffic jams are unavoidable. To reduce the risks as much as possible, as well as efforts to improve shipment forwarding, you can focus on the following:
- Use Alternative Ports: Freight forwarders can consider using alternative ports that are less congested. This may require longer transit times or higher transportation costs, but it can help ensure that goods are delivered on time and without additional fees.
- Plan Ahead: Effective planning is critical to avoid port congestion. Freight forwarders can work with their clients to plan shipments well in advance, taking into account factors such as peak shipping seasons and potential port congestion.
- Improve Communication: Effective communication between freight forwarders, shipping lines, and port authorities is essential to ensure that cargo moves smoothly through ports. Freight forwarders can work to establish open lines of communication with all stakeholders to avoid delays and minimize costs.
- Technology Solutions: Technology solutions such as digital platforms and automation can help freight forwarders optimize their supply chain management processes, including booking, tracking, and documentation. These solutions can improve visibility and reduce the risk of delays and errors.
What is it like to use real-time container tracking software?
Containers are a real revolution today. About 90% of the goods produced are transported by sea through containers. And there are many container tracking systems, but more important is finding one that is reliable, functional, and adaptable to your business. Otherwise, tracking is one of the most successful ways to respond to unforeseen situations and delay containers in ports.
Real-time container tracking software allows users to track the movement of their cargo containers throughout the supply chain. Here are some of the experiences you might have while using real-time container tracking software:
- Improved visibility: This real-time visibility helps companies stay informed of the location of their cargo containers and any potential delays that may arise. Companies can quickly identify any issues and take the necessary action to prevent further delays. Additionally, it allows companies to keep track of inventory levels and plan for future needs. This helps companies save time and money by reducing the need for manual tracking and monitoring. With the help of container tracking software, companies can also monitor the condition of their cargo containers, preventing any potential damage or theft. Furthermore, improved visibility also helps companies better manage their supply chains and optimize their operations. Through container tracking software
- Increased efficiency: By leveraging powerful analytics and predictive capabilities, container tracking also helps users anticipate and plan for supply chain disruptions, resulting in improved efficiency. This can be achieved by ensuring that shipments are delivered on time and that inventory is accurately tracked at all times. Additionally, real-time container tracking makes it easier to detect and respond to any issues along the supply chain, reducing the risk of delays or inventory problems. Ultimately, this increased efficiency translates into increased profitability for the user.
- Enhanced security: Real-time container tracking software can also provide alerts when containers are being tampered with or are being moved to unauthorized locations. This can help to improve security and deter potential criminal activity, as well as reduce the risk of stolen goods. Additionally, real-time tracking software can be used to monitor and assess container temperatures, which is especially important for food items, pharmaceuticals, and other goods that must be stored at specific temperatures. By providing accurate temperature readings, this software can help reduce wasted goods and ensure the safety of the goods being transported.
- Customizable alerts: Users can also set up alerts to receive notifications when cargo is delayed or fails to arrive on time, allowing them to react quickly and take the necessary steps to minimize delays. Additionally, users can customize the alerts to be sent in their preferred language, giving them the ability to stay informed and up-to-date in their own language. Furthermore, users can set up alerts related to the temperature and other environmental conditions of the cargo, enhancing visibility and control over the supply chain. Additionally, users can customize the frequency of the alerts they receive, giving them the ability to stay informed without being overwhelmed by notifications.
- Improved customer service: Real-time container tracking software allows customers to receive automated alerts when their cargo reaches certain milestones in the shipping process, providing an extra layer of transparency. Additionally, customers can access this information around the clock, allowing them to get timely updates no matter the time or day. Ultimately, this software increases customer satisfaction and loyalty by keeping them informed and in control of their cargo shipment.
- Self-service tracking: Self-service tracking offers great convenience to customers by providing up-to-date information on the shipment’s current status. It eliminates the need to contact customer service and wait on hold for an answer, as customers can quickly and easily access the information they need. This technology is a great way to improve customer satisfaction and streamline the shipping process.
Overall, using real-time container tracking software can provide users with a range of benefits, including improved visibility, efficiency, security, customizable alerts, and enhanced customer service.
The tracking system actually allows the customer to enter the portal, through personal data. From there, they can learn about everything that excites them. Upon request, they will be informed of the location or shipment delay. Potential port delay options are mentioned, which makes it easier for freight forwarders because they do not have to inform them in person. The self-service portal integrated with an online freight solution is a value that any freight forwarder can add, and good relations can be built between a specialist and a client.
The freight forwarding industry faces many challenges in order to successfully handle all activities in the supply management process. Time is money, and the client expects the correct execution of transactions. Taking our advice into account, you can achieve optimal results in the forwarding of your company. There are many reliable software programs to adapt to your business!
Logitude World provides freight forwarders with advanced freight forwarding software to manage all operations on one digital platform and deliver superior freight services.