The eternal challenge of perishables shipping: transparency

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As a company that makes software for logistics, we strive to make a difference by getting to know the specifics of the sector inside out. This knowledge of the day-to-day work allows us to learn about the pains and gains of a certain process, and create more valuable applications.

Perishables: a world of its own

Almost a year ago we made our first contacts with the perishables industry. What struck us immediately was the fact that not all freight forwarders want to ship perishables. The shipping of perishable goods should be seen as a true specialization. Moreover, within the category of perishables, certain forwarders specialize in specific type of product. We’ve encountered forwarders specialized in frozen goods, fruit & vegetables, meat, pharmaceuticals etc.

We now know that this advanced form of specialization is due to the specific knowledge every product requires. The pre-cooling, the cold storage, pre- and end-haulage, the handling of the goods, and so on, all depends on the characteristics of the particular product.

Black boxes

Despite the advanced expertise in each process of the voyage, we’ve noticed the risk of products arriving unfit for consumption still persists. The cause of this mostly lies with the one part of the voyage that can’t be controlled: the shipment overseas. The reefer container remains a black box which poses a lot of risk. Three factors exists which may drastically impact the shelf life of the goods during the shipment overseas: temperature, lead time, and impact damage.

No lack of effort

Forwarders and shippers try to prepare themselves for these risk as much as possible by placing sensors which may inform them of the location and the temperature. Carriers try to aid them by promising to ensure a temperature-controlled environment and sharing the container status events.

Nevertheless, shippers, forwarders and carriers still lag behind reality. First of all, the temperature data, in most cases, is only received after the completion of the voyage. Second of all, the status events shared by carriers is not perfectly accurate. At this point in time the tools that are used only allow to document what went wrong during the journey after its completion.

Live information, shared across cold chain partners

It was clear to us that there exists an urgent need for full transparency of the overseas shipment. The slightest deviations in lead time or temperature may cause the irreversible loss of an entire container load’s value. For that reason, we have created a web application that allows users to monitor the temperature within the container in real time, and match it with the live location.

The track & trace solution we provide is based on all the available data sources (containers status events, AIS-data, sensor data, carrier schedules, historical data etc.) to calculate the ETA as precise as possible. In addition, our application foresees user-configured alerts, which results in receiving a warning email in case of temperature deviations or changed ETA. This allows shippers and freight forwarders to anticipate these deviations, instead of documenting them. For example: making it a priority to first deliver the container who has experienced the most fluctuations in lead time or temperature – which we like to call shelf life-driven logistics.

Another possibility is to contact the carrier with details about specific temperature deviations, who in turn can contact a technician on board to reset the reefer container. Both examples have occurred, and were shared to us by our users.

K+N and Maersk feel the urge, too

Next to Dockflow’s application, we see that there are others in the market who can also feel the urge to create a more transparent shipping process. Maersk’s ‘Remote Container Management’ (RCM) feature is a great example [1].

Then there is Kuehne & Nagel’s recently released ‘Pledge’ feature. A fitting name, as the most important part of the service consists of Kuehne & Nagel entering a promise to guarantee a certain lead time of a shipment. To that extent that 100% of the money will be paid back if the promised lead time is not met.

There is always a catch

Both initiatives are a step in the right direction, although each of them has its flaws. Maersk’s temperature data received through RCM cannot be used in case of a damage claim, as you can read below.

15. You may not use the Data, in whole or in part, in any form, as grounds for any claim, action or inaction, whatsoever and howsoever arising in relation to the goods and/or the contract of carriage.

Maersk RCM Terms and Conditions

The ‘Pledge’ feature of Kuehne & Nagel foresees an even more extensive limitation as it excludes its application for the shipments of perishables and/or temperature controlled goods entirely. This was quite a surprise since we found out about the feature via Freshplaza [2]. In the press release this rather important exclusion was not mentioned. The literal wording of the general terms and conditions are the following:

4.1  Quoted FCL rates apply to standard containers and dry cargo. The rates do not apply for container with dangerous, hazardous and contaminated goods, perishables, temperature-controlled, military or defense products, oversized, over-length, out-of-gauge cargo, or any other special cargo, such as, but not limited to, cash, jewelry, antiques, art or fine art products, paintings and vehicles, unless explicitly mentioned in the offer and explicitly accepted by Kuehne + Nagel.

K+N Pledge General Terms & Conditions

Embracing change

By way of ending on a positive note: change is happening. In the meantime, we will keep learning about the industry and all its ins-and-outs. We will continue in our ambition of creating valuable applications which make operations more efficient, and the life of a logistics enterprise easier.



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