8
WE are going through one of the most testing periods in the history of post-war logistics. Not even the fuel crisis of the 1970s, the recession of the early 1980s, the first Gulf war, SARS or 9/11 has matched the intensity and dramatic decline in volumes of world trade, be it air, ocean or surface. For sure, many companies within the supply chain are struggling – airlines, shipping lines, sales agents, handlers, truckers – have all had to rapidly re-examine their business plans and, in many cases fight for survival. The multinational logistic companies too have had to take tremendous hits and have been busy desperately reducing costs through manpower cuts, changes in strategy and cutthroat pricing. Deutsche Post DHL recently announced a 94 per cent drop in profits, UPS announced a big drop in logistics earnings and the other large forwarders such as Panalpina, Schenker and K+N have found profits plummeting and shareholders wailing in agony. But what about the smaller independent forwarders? Have they, like DHL’s Hermann Ude suggested, suffered even greater woes, relying on single or limited markets? Or have the close personal service and niche specialisations helped independents to ride the worst of the storm? Although the summer period is likely to provide the most difficult trading conditions ever experienced by the industry, early indications are that small and medium forwarders are likely to endure the downturn better than the less agile and adaptable multinationals. Many have even benefited thanks to close personal relationships with customers. The widespread predictions that hundreds of smaller agents would be forced out of the market are yet to materialise and the scale of bankruptcies falls below all analyst predictions. In total a collated appraisal from forwarders associations in three continents, puts bankruptcy rates for independent forwarders for the previous 12 months at around 0.8 per cent. Indeed many small forwarders have taken the opportunity to re-examine their business plans and strategies and focus on delivering quality service. There is growing evidence that the summer period will see the end of the worst of the downturn and that the autumn ‘peak season’ may be better than originally feared. Airfreight is generally accepted to be ‘first into recession and first out’. Heads of cargo of a number of key airlines are predicting that the downwards year-on-year trends of recent months will level out and even show small signs of growth by the end of the fourth quarter. “Inventories are reaching critical levels” said Carsten Spohr, chief executive officer of Lufthansa Cargo “companies will be forced to re- stock.” Inventory levels are a key indicator of the prospects for logistics and airfreight in particular. Monica Tappi,Vice President of the WCA Family of Logistic Networks said “Our members are reporting small but encouraging indications from their customers, the shippers and consignees. As the record half of 2009 begins we may see the supply chain reconnecting and manufacturers, distributors, suppliers and buyers looking to replenish inventory”. More promising news has come from the International Chamber of Commerce, that stated in May that the world economic climate index rose in the second quarter of the year for the first time since 2007 as a result of more favourable expectations for the coming six months. ICC Secretary General Guy Sebban said that the report gave him reason for cautious optimism. “After four months of very depressing news we are finally seeing some signs of hope,” he said. “The outlook for the next six months is positive for most areas of the world, including the United States and Europe.” In addition share prices have been rising in key markets showing a return of confidence and the oil price has also risen as speculators gamble on an increase in demand later this year, as manufacturing begins to recover. With airfreight likely to show the first signs of recovery, ocean freight volumes are predicted to begin a gradual recovery from the first quarter of 2010. When the recovery begins, it is the independent agents that have the agility to move quickly and gain the first advantage. The key is to plan in advance and have your strategy in place to take full advantage, while the multinationals are distracted by ongoing measures to reduce headcount and exposure to shareholders wrath. Independents shine as light appears at the end of the tunnel Surviving the ‘perfect storm’ Monica Tappi,Vice President, WCA Family of Logistic Networks Small but encouraging indications Airfreight is predicted to recover ahead of ocean freight

Surviving the ‘perfect storm’€¦ · the end of the worst of the downturn and that the autumn ‘peak season’ may be better than originally feared. Airfreight is generally

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Page 1: Surviving the ‘perfect storm’€¦ · the end of the worst of the downturn and that the autumn ‘peak season’ may be better than originally feared. Airfreight is generally

WE are going through one ofthe most testing periods inthe history of post-warlogistics. Not even the fuelcrisis of the 1970s, therecession of the early 1980s,the first Gulf war, SARS or9/11 has matched theintensity and dramatic declinein volumes of world trade, beit air, ocean or surface.

For sure, many companieswithin the supply chain arestruggling – airlines, shippinglines, sales agents, handlers,truckers – have all had torapidly re-examine theirbusiness plans and, in manycases fight for survival.

The multinational logisticcompanies too have had to taketremendous hits and have beenbusy desperately reducing coststhrough manpower cuts,changes in strategy andcutthroat pricing. Deutsche PostDHL recently announced a 94per cent drop in profits, UPSannounced a big drop inlogistics earnings and the otherlarge forwarders such asPanalpina, Schenker and K+Nhave found profits plummetingand shareholders wailing inagony.

But what about the smallerindependent forwarders? Havethey, like DHL’s Hermann Ude

suggested, sufferedeven greater woes,relying on single orlimited markets? Orhave the close personalservice and nichespecialisations helpedindependents to ride theworst of the storm?

Although thesummer period is likelyto provide the most

difficult trading conditions everexperienced by the industry,early indications are that smalland medium forwarders arelikely to endure the downturnbetter than the less agile andadaptable multinationals. Manyhave even benefited thanks toclose personal relationshipswith customers.

The widespread predictionsthat hundreds of smaller agentswould be forced out of themarket are yet to materialiseand the scale of bankruptciesfalls below all analystpredictions. In total a collatedappraisal from forwardersassociations in three continents,puts bankruptcy rates forindependent forwarders for theprevious 12 months at around0.8 per cent. Indeed many smallforwarders have taken theopportunity to re-examine theirbusiness plans and strategiesand focus on delivering qualityservice.

There is growing evidencethat the summer period will seethe end of the worst of thedownturn and that the autumn‘peak season’ may be betterthan originally feared.

Airfreight is generallyaccepted to be ‘first intorecession and first out’. Headsof cargo of a number of keyairlines are predicting that thedownwards year-on-year trendsof recent months will level outand even show small signs ofgrowth by the end of the fourth

quarter. “Inventories arereaching critical levels” saidCarsten Spohr, chief executiveofficer of Lufthansa Cargo“companies will be forced to re-stock.” Inventory levels are akey indicator of the prospectsfor logistics and airfreight inparticular.

Monica Tappi,VicePresident of the WCA Familyof Logistic Networks said “Ourmembers are reporting smallbut encouraging indicationsfrom their customers, theshippers and consignees. Asthe record half of 2009 beginswe may see the supply chainreconnecting andmanufacturers, distributors,suppliers and buyers looking toreplenish inventory”.

More promising news hascome from the InternationalChamber of Commerce, thatstated in May that the worldeconomic climate index rose inthe second quarter of the yearfor the first time since 2007 asa result of more favourableexpectations for the coming sixmonths.

ICC Secretary General GuySebban said that the reportgave him reason for cautiousoptimism. “After four months ofvery depressing news we arefinally seeing some signs ofhope,” he said. “The outlook forthe next six months is positivefor most areas of the world,including the United States andEurope.”

In addition share priceshave been rising in key marketsshowing a return of confidenceand the oil price has also risenas speculators gamble on anincrease in demand later thisyear, as manufacturing beginsto recover.

With airfreight likely to showthe first signs of recovery,ocean freight volumes arepredicted to begin a gradualrecovery from the first quarterof 2010.

When the recovery begins, itis the independent agents thathave the agility to move quicklyand gain the first advantage.The key is to plan in advanceand have your strategy in placeto take full advantage, while themultinationals are distracted byongoing measures to reduceheadcount and exposure toshareholders wrath.

Independents shine as light appears at the end of the tunnelSurviving the ‘perfect storm’

Monica Tappi,Vice President,WCA Family of LogisticNetworksSmall but encouraging indications

Airfreightis predictedto recoverahead ofocean freight

Page 2: Surviving the ‘perfect storm’€¦ · the end of the worst of the downturn and that the autumn ‘peak season’ may be better than originally feared. Airfreight is generally

BEING a member of the WCA Familyhelps protect independent forwarders fromthe worst of the financial crisis and providesnew growth opportunies, according toDaniel M Tarditti, managing partner ofArgentina-based Rush Cargo.

“We read about the massive downturnsand the problems faced by airlines andmultinational forwarders in the tradenewspapers, but thanks to the new businessgenerated through the WCA Family wehave created new possibilities and newvolumes. We feel very confident that wecan continue to grow from strength tostrength.

Tarditti says that membership of WCA hashelped diversify his business by providingmany new partners and opportunities. “Weoffer import and export for air, ocean andland transport and have been able to rapidlyreact to the changing situation in ourcountry. The vast majority of our business

used to be imports. But since the currencysituation changed in Argentina we havefound excellent export niches. For examplewine and beer along with car parts exportsand other manufacturing has reallyaccelerated. Thanks in part to the WCA, wehave been able to take advantange of thisand we seem to being doing much betterthan reported in the newspapers. This crisishas created new opportunities for smallerforwarders.

2 WCA FAMILY NEWS

IS it feasible toconsolidate and evenexpand your logisticsbusiness in the currenteconomic gloom? Thereports from themultinationals wouldmake you think it wouldbe impossible – as theycut staff, engage inhurried cost-cuttingprogrammes andrationalise theirservices.

However, manyindependents are findingnew opportunities in themarket, thanks to acustomer-oriented

approach, flexibility ofservice, marketspecialisation and tailor-made solutions that givethe client exactly whatthey want.

Project specialists TheFreight is one suchcompany that hasovercome morechallenges than most, yetis still recording excellentresults and proceedingwith its ambitiousexpansion plans. It nowemploys some 120 staffin three countries.

Asia has been hitharder than any other

region, and with itsoriginal office in Thailandnow joined by facilities inVietnam and China, youwould expect thecompany to bepessimistic about thenext twelve months. Thereality is that thecompany, thanks to itsentrepreneurial spirit andthe new businessgenerated frommembership of the WCAand WCA ProjectNetwork is booming asPatrick Dick, managingdirector, explains.

“We have hardlynoticed any drop involumes, despite theworldwide recession. OurThailand business startedvery well in the new yearwith project shipments toRussia, Libya and theUSA. Not only that, wehave receivedconfirmation for aninfrastructure projectworth around 1,000containers this year.”

In Vietnam too thecompany has managed

to increase its footprint,especially in oceanfreight. “Our charteringdepartment in Ho ChiMinh has gained steadypopularity with agentsworldwide and we arenow regularly fixingvessels for a number ofagents as far as the USAand Europe.”

In China too thecompany is managing togain new businessdespite the very difficulttrading conditions.“Considering we are veryyoung in China andVietnam we are doingvery well andexperiencing steadygrowth for our group.Although with the globalslowdown we have toexpect China’s andVietnam’s economies tocontinue to cool through2009.”

So what measures hasThe Freight put in placeto allow it to weather thestorm? Dick says thatdiversification has beenimportant, opening newoffices and offering newservices. He adds thatThe Freight “sellsprimarily our services andwe believe in what wedeliver”. Branding andreputation in the marketis also extremelyimportant says Dick. “Ournew corporate identityand logo is a mixbetween the Swiss rootsof the company’smanaging partners andthe ‘Swiss quality’ we aretrying to deliver. That iswhy we are calling it‘Service Plus’.

Dick is also keen toacknowledge the role

WCA plays in formingnew partnerships andcreating business. “Weare still working withsome partners wherecooperation dates backbefore we joined WCA.However, we have‘uprooted’ many otheragents and replacedthem with WCA agents.This is primarily due tomember-to-memberfinancial protectionschemes and the regularopportunity to networkonce a year with amultitude of WCAmembers at theconferences. Nowadayswe reject any unsolicitedapproach from non-member companies.”

The fact that TheFreight is looking toexpand its activitiesfurther in the currentclimate is testement to itssound business plan.Two senior appointmentshave recently been madeto develop business inChina and Vietnamrespectively. ThomasOfner has joined theBeijing office to managea major contract with thecement industry and in

Vietnam PeterSchupbach is the newchief representative forthe country. “Wecontinuously expand oursales force. We aren’tmaking any majorchanges because of theslowing economy. Wewould definitely like toexpand further in China,India and possibilityIndonesia.”

Why these countries?Dick says the reason issimple: “They all have alarge population andlarge geographical areabut lag far behind withtheir infrastructure.Therefore manycustomers are longing tofind a partner thatdelivers quality solutionsand assistance in solvingtheir supply chainproblems – the problemsthat only small andmedium-sized forwarderstake their time to look at.These customers arewilling to pay adequatelyfor our services and thatis a key part of oursuccess – we focus onhigh yield business andnot necessarily bigvolume customers”.

‘Believe in what you can deliver’

New businessgenerated frommembership of theWCA is booming

WCA has helped create newpossibilities and volumes

Peter SchupbachNew chief representativefor Vietnam

Thomas OfnerManaging a new majorcontract in Beijing

Crisis brings new opportunites

Page 3: Surviving the ‘perfect storm’€¦ · the end of the worst of the downturn and that the autumn ‘peak season’ may be better than originally feared. Airfreight is generally

WCA FAMILY NEWS 3

Help For Producers of Temperature-Sensitive Goods

FOLLOWING repeated demands from shippers and clients alike the Perishable Logistics Alliance (PLA) has been formed to create a worldwide network of qualified, independent specialist freight forwarders who deal in the transportation of temperature-sensitive cargo including: • Fruits and Vegetables• Meats/Fish and Seafood• Flowers• Live Animals• Pharmaceuticals• Temperature-Sensitive Hi-Tech Equipments • Any other Cool Chain Necessities

Headed by Richard Overton at the WCA Family of Logistics Network in Bangkok, this alliance brings these certified, financially guaranteed, independent logistic companies together on a global platform to handle enquiries from shippers, traders, dealers, manufacturers worldwide and to perform unique and efficient services coupled with industry-expertise and local knowledge. Due to the significant and steady increase in world trade of perishable refrigerated commodities during the past decade,

perishable logistics has become one of the leading logistics markets where capabilities with conventional and specialist reefer cargo movements have become a primary focus for cargo owners. The Perishable Logistics Alliance has been developed to promote and guarantee the professionalism and capability of our global members.

Gervais Iralde of Mory Europa commented on the necessity of professional experienced forwarders. “The reefer/perishables business is different. It operates in a small niche market, which requires lots of sweat and knowledge. Both the producers and importers care about the product that is both fragile and of high value. The operator must deliver a quality product in a timely fashion by using the fastest way of transportation and perform the customs, veterinary or phyto-sanitary clearing of the products by using the interpretation of local regulations and by having adapted warehousing and specialized trucking fleet. “Mory Europa has a team of natives from several European

www.perishablelogisticsnetwork.com

Mr. Richard OvertonVP of specialty network

Mr. Gervais IraldeGM – Seafreight & Reefer Division

nations speaking various European languages, based in Rotterdam and Antwerp, they are able to serve all European

countries for several sensitive products and transport them in good care, offering the highest of standards necessary

for this niche market. Mory Europa joined the perishables logistics alliance (PLA) in order to promote our 20 years of

experiences in the reefer business and to identify professional logistics partners with the same specialized knowledge.”

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4 WCA FAMILY NEWS

WHAT do insurers mean when they talk about ‘project cargo’? Definitionsvarybetweeninsurersbutessentiallyitmeansanylarge,valuableornon-standardcargo,butitcanextendtoadefinedsetofshipmentsrelatedtoaparticularconstructionorinfrastructureproject. Do you have to see specialist insurers to get cover? Generallyspeakingyes.Mostlocalinsurersorthoseinsurersinterestedinprincipallystandardcontainerisedcargoareeitherunabletowriteprojectcargoesorarenotparticularlycompetitivewhenaskedtodoso.Forthatreason,itisimportanttohavethecapabilitytoapproachthe

specialistinsurerswhotendtobedivisionsofthemajorinternationalcompaniesinLloyds.Thisisespeciallyimportantifthecargoesareparticularlylarge,awkward,orwhereDelayinStart-Up(DSU)coverageisrequired. What do insurers normally ask for when quoting for this type of business? Forastart,theywouldaskallthenormalquestionsaboutcargovolumes,typesandvoyagesinvolved,buttheywillalsobemoreinterestedthanusualinthepackingandstowagearrangements.Theywillalsowanttoknowaboutanycriticalitemsintheshipmentschedule.IfthereisDSUcoveragerequiredthentheywillwantto

knowaboutthereplacementtimesandcontingencyarrangementsinrespectofanyitemswhicharecriticaltotheproject.Surveyarrangementswillalsobeimportantinthecaseofoversized,delicateorcriticalcargoes. Are there any special insuring conditions applicable that I should be aware of? Itiscommonlythecasethatinsurerswillrequireloadinganddischargesurveysonmajororcriticalitems.Thesesurveysareoftencarriedoutbytheirownpersonnel,otherwiseanindependentthirdpartyfirmwillbeappointed.Theremayalsobespecificconditionsrelatingtothecharacteristicsofthecargobeinginsured,forexampleconcerningtheriskofrustdamageorthetwistingorbendingofpipework. What exactly is Delay in Start-Up (DSU) / Advance Loss of Profits (ALOP)? Thisisinsuranceagainstfinanciallossincurredasaresultofthelateornon-arrivalofcriticalitems,resultinginthedelayedstartoftheproject.Coverageis

What is specialist project cargo

102 piracy incidents were reported in the first quarter of 2009 to the International Maritime Bureau, almost double the same period in 2008 with reported 53 incidents. While the concentrations of the attacks have been in the seas off Somalia, the reality is that this phenomenon is a global issue with 41 attacks occurring worldwide in the first three months of 2009. With the number of attacks consistently on the rise the safety of ships is more and more the question on everyone’s mind. However the pirates are more and more determined in their actions and have been able to receive millions of dollars for the release of ships and their crew. For example on May 10, 2009 a British-owned vessel was released with its 16 crew members after the pirates claimed they received US$2 million flown in by helicopter. With such ransoms available for the boats and their crew pirates have also stepped up their attacks on smaller vessels including yachts. Currently there have been four pirate attacks on private yachts this year, occurring in Brazil, Thailand, Seychelles and Somalia. The latest being the yacht Tanit crewed by four adults and a three year old boy whom were attacked by pirates in April 2009. Four of the hostages were rescued by the French Navy with the unfortunate casualty of the three year old child’s father.

Piracy a new global threat

Philip BilneyGroup Executive DirectorFP Marine Risks Limited

relatedtophysicallossordamageofthecargo,ordamagetothecarryingvessel,andisaddedasanadditionalcoverageunderthecargoinsurance.Theinsuranceislimitedtoapre-agreedamountofdowntimewithanagreedinsuredamountperday. Has the economic downturn made this class of insurance more difficult to arrange? No,absolutelynot.Infact,underwritersareprobablyevenkeenertobeinvolvedwithprojectcargoesastheprospectofnumerousgovernment-fundedinfrastructureprojectsaroundtheworldmaymakethisclassofbusinessmoreactiveduringtherecession. Where/who can I get specialist advice regarding handling and stowage of project cargo? Anyunderwriterwhois

involvedintheinsuranceofprojectcargoeswilleitherbeabletoprovidetheirownriskmanagementteamformajorprojectsorwillassistintheappointmentofathirdpartyspecialistsurveyor.FPMarineRiskscanofcoursealsoadviseonanappropriateprojectcargoexpertwhocanassistinyourpartoftheworld.

Publishers Logistics Alliance goes to London Book FairTHErecentlyformedPublishersLogisticsAllianceexhibitedattheprestigiousLondonBookFairinApril;sharingaboothwithClarkWorldwideTransportInc.USAwerefellowmembersCTFreightUKandHOCCanada.DavidYokeumCEOtravelledtotheEarlsCourtvenuerepresentingtheWCAFamilyofLogisticNetworks.ThiswasthefirsttimethatthePublishersLogisticsAlliancehadattendedthiseventandtheresponsehasbeenveryencouraging.Theallianceisspecificallyandsolelyforindependentfreightforwarderswhoprovidespecialisttransportservicesservingtheshippers,buyersandconsigneesintheprintandmediaindustry.FollowingthissuccessplansarenowunderwayforthePublishersLogisticsAlliancetoexhibitatthehugeFrankfurterBuchmesseGermany14-18October2009,whenthetradefocuswillbeuponChina,againsupportedbythequalifiedmembersofthisnewnetwork.OurthankstoMarkDaveyMDCTFreightUKfortheimages.

Formoreinformationpleaselogontohttp://www.publisherslogisticsalliance.com

Pirate attacks in 2009

Page 5: Surviving the ‘perfect storm’€¦ · the end of the worst of the downturn and that the autumn ‘peak season’ may be better than originally feared. Airfreight is generally

WCA FAMILY NEWS 5

Attention Producers and Shippers of Dangerous Goods!

www.dangerouslogisticsalliance.com

A NEW network has been established to assist specialist producers and shippers of dangerous and hazardous goods. The Dangerous Goods Logistics Alliance (DGLA) has been formed to create a worldwide network of qualified, independent specialist freight forwarders who deal in the transportation of all classes of Hazardous Cargo, Chemical, and military shipments worldwide. The creation of this alliance allows these certified, financially guaranteed, independent logistic companies to work together on a global platform to satisfy the needs of even the largest client. A founder member of the alliance Dangerous Goods International (DGI) headquartered in London with 11 offices in eight countries commented on the importance of speciality networks particularly the Dangerous Goods Logistic Alliance.

“With the chemical industries increasing in importance within the global economies, as well as considering that numerous non-chemical companies that are handling Dangerous Goods

& Hazardous Materials in their daily operations, it becomes imperative in the supply-chain industry to understand the special requirements of handling, storing and shipping those products. The logistics for Dangerous Goods & Hazardous Materials does not only require specific training but also detailed knowledge on the individual products as well as on the country specific regulations. Only the compliance with all of the requirements ensure the safe transport of Dangerous Goods cargo, which means that all entities involved in the carriage of dangerous goods must handle their part of the supply-chain in line with the legal requirements. The DGLA provides this expertise within its members ensuring you are working with an agent that is handling Dangerous Goods on a daily basis and understands the legal requirements in their respective area. The penalties for shippers and their forwarders can have major consequences for both parties involved and with stricter controls all over the world, shippers tend to value expertise over cost savings and inexperienced partners. Dangerous goods international is a unique company within this niche side of the business providing a true door-to-door service concerning dangerous goods transport, this is not possible without a good network. The DGLA network provides DGI with

the opportunity to identify partners abroad who hold the same high standards.” The DGLA provides a great foundation for other

unique and professionally focused Dangerous Goods cargo handlers to take advantage and build stronger relationships

between other members and cargo owners. The DGLA is a network of opportunity where shippers and forwarders can find

partners with confidence and peace of mind knowing they are experts in handling Dangerous Goods.

Mike LigthartManaging Director

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6 WCA FAMILY NEWS

Are You Sure Those Are Your Terms(Incoterms, that is)?WE at the WCA Family are aware of the ‘cause and effects’ made by legislation from different governing bodies involved in regulating the freight and logistics industry. We always look at ways to help shippers, buyers/consignees and agents avoid the pitfalls not foreseen by these organisations when drafting such legislation. In the case of incoterms, these are very basic transport terms and have been written so that all parties (Shipper, Consignee/Buyer and Agents) clearly understand the conditions that apply when a shipment sails or flies as quoted and arrives successfully, Customs cleared and given to the Consignee --- “a perfect scenario”! But, alas, more often than not, nothing is perfect. For example

shipments have actually been abandoned by the shipper or consignee due to misunderstandings on where the responsibilities lie with regard to charges and who should pay. We see this more frequently in so called “freehand shipments,” a slang term in the industry, and we advise WCA Family members handling these types of shipment to put the actual shipper and consignee on the Master B/L - as the liabilities will rest with them should there be problems. Here are the six most used incoterms in today’s industry; we will try to clear up any misunderstandings or different interpretations. For the purposes of this article we will use the term “Consignee” to also mean the “Buyer” as in some cases it is a “triangle shipment”, where the Buyer purchases

from one market and ships directly to his buyer (the actual Consignee). EXW Ex-Works, this is quite a simple arrangement between the shipper and the consignee. Once the shipment has left the Shipper’s premises all charges are on the account of the consignee. We would term these as all local charges at origin and destination, the freight charges and insurance (if the consignee so requires) and will all be paid by the consignee. The consignee should have an agent in place at origin to handle the local operations, (trucking, documentation, customs export clearance, freighting etc). The consignee should also have in place an agent at destination to handle

the customs clearance and transport if delivery is required. Ideally the agents at origin and destination are in partnership and it assists the consignee to know them both and their service levels – and to know all the charges involved. FOB Free on Board, again a simple arrangement except that the shipper will be responsible for all charges to get the goods onto the carrier. The freight charges are usually then controlled by the destination agent through his partner agent at origin. Now the consignee is responsible for the freight on “charges collect,” insurance, (if required) and local charges at destination. Again hopefully the consignee already has an agent in place at destination to handle the shipment (which is not the case with the so called “freehand” shipment -- the origin agent can basically nominate any agent he wishes). If the consignee does have a preferred agent, it is important that he provides that information to the Shipper in a Routing Order. CFR Cost and Freight, now shifts responsibility of the shipment and all charges up to arrival at destination port on to the shipper. The shipper is also responsible for nominating the agent handling the export from origin and needs to have all

charges (pre)agreed with that agent. The consignee is now responsible only for the clearance and delivery and insurance (if required) at destination. CIF Cost, Insurance and Freight, the same as CFR except the shipper will also arrange and pay for adequate insurance cover for the value of the goods. The consignee is now responsible only for the clearance and delivery at destination with his local agent. DDU Delivered Duty Unpaid, means responsibility for all charges up to door including local charges at origin, freight charges, handling and delivery are for the shipper, excepting the duties and taxes and the cost of Customs clearance. Some agents believe that the Customs clearance charge is part of the handling charge and do charge this back to the shipper. Unless the invoice clearly states, or relates to, a charge for the actual Customs clearance then the shipper has the right to refuse that charge. Actual handling charges other than Customs clearance are for the account of the shipper

and he would have to accept these charges directly (or through his Agent at origin). DDP Delivered Duty Paid. From one end of the spectrum to the other, where now all charges up to consignee’s door are for the account of the shipper. Shippers and Consignee’s beware -- failing to have your chosen Agent(s) handle your shipments could expose you to charges you were unaware of and can be exorbitant. Examples are extra charges like storage / demurrage which can be incurred due to the agent being unfamiliar with your company and your requirements. Next issue we explore the PITFALLS associated with misunderstandings of Incoterm.

WCAPN moves to Istanbul

FOR the first time ever the WCA Projects Network (WCAPN) will be hosting its 3rd annual conference in Istanbul, Turkey from September 17-19. This event brings together members of this alliance which comprise

many of the world’s most experienced independent project forwarders and other service providers engaged in project-related activities. Creating a perfect environment for professionals in the project forwarding industry

to discuss business, build and strengthen ties with other partners and more importantly cooperate in improving the project forwarding industry for their customers. This year’s conference is geared up to be a bigger success than the last and has already secured sponsorship from industry professionals such as Beluga, Rickmers-Linie and Ruslan International.

For more information please contact [email protected]

Page 7: Surviving the ‘perfect storm’€¦ · the end of the worst of the downturn and that the autumn ‘peak season’ may be better than originally feared. Airfreight is generally

WCA FAMILY NEWS 7

THE two fastest growing developing nations in the world are arguably China and India. However, in terms of forwarding infrastructure this is where the similarity ends. The two giants have developed their transportation industry in two completely different ways.

China’s economy in terms of GDP is over three times as large as India’s but its container volume is more than 10 times the size of its counterpart. Not surprisingly China has over 700,000 logistics enterprises registered in China today, demonstrating the dependence China has on manufacturing and exports. Most of these logistic enterprises are small- to medium-sized operators. In contrast, India is heavily dependent on its service industry. This difference is obvious when visiting various ports of the two nations. China’s are

top notch facilities with outstanding capabilities that rival developed nations

worldwide. However China’s internal

infrastructure has yet to catch up with that of its ports. The nation’s railway system, as well as its highway and secondary roads network, are lagging behind its ports infrastructure. India’s shortcoming is its ports being consistently congested which may lead to the delayed and disrupted flow of goods. Also modernization of packing and handling methods needs addressing plus the existing documentation system. However, their internal infrastructure is significantly more developed and has been the foundation for investment into the country by the freight forwarding industry.

Contrasting Development in India and China

Despite their difference

China and India are both taking steps to improve their infrastructures. As a result

several companies have taken strategic steps to expand into these markets in order to take advantage of the new improvements rapidly.

Buyers and traders from all over the world see these two giants as

their main trade

lanes for years to come so it is important to get the Supply Chain right.

Independent forwarders with real local knowledge and true local focus are at the forefront to smooth the passage of goods through both these counties

systems.

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Page 8: Surviving the ‘perfect storm’€¦ · the end of the worst of the downturn and that the autumn ‘peak season’ may be better than originally feared. Airfreight is generally

8 WCA FAMILY NEWS

Unique services for shippers

THE WCA Family of Logistic Networks will shortly produce a regular, weekly, updated Vendors Bulletin designed to assist service providers and members who perform specialist services to make these known and available to the general membership of all WCA family members. The new Bulletin will be distributed through email and members will be able to sort the data either by service provider name or the actual service that is being offered. Categories will include air charters, ocean charters, vessel availability, aircraft availability, break bulk services and load space, cranes, barges, heavy-lift, road services, rail cargo, ship-owner services, insurance services, project facilities, IT services, printing services, perishable handling, LCL services, dangerous goods, live event and exhibition movements, sea-air facilities, special equipment availability, 3PL / 4PL warehousing distribution, publishers logistics services, Customs clearance and brokerage, legal services, etc

DEPENDABLE Hawaiian eXpress (DHX) part of the Dependable Group of Companies will be celebrating 60 years of excellence next year. DHX service Hawaii and Guam shipping and logistics need and specialize in transportation, warehousing and logistical types of operation. Dependable Hawaiian eXpress are ahead of their game being the only major forwarder that is ISO certified and the only major forwarder with trucking operations in the major port areas in both Hawaii and Guam. DHX controls the quality and service by having their own operations as well as offering their customers the choice between their many services – making sure their customers deal with one company from beginning to end.

Brad Dechter the President of Dependable Hawaiian eXpress (DHX) as well as Dependable Global eXpress (DGX) and Dependable Air cargo eXpress (DAX) who decided 11 years ago to join the WCA Family of Logistics Network as founding members, has seen his company grow at a parallel pace to that of the WCA Family. Brad Dechter mentions that part of their success is due to the decision to take their offices outside of the United States of America and grown their business by concentrating on areas outside of the USA. This decision was greatly influenced by the safety net that the WCA Family offered to its members via their gold medallion program. Currently Brad deals exclusively with members of the WCA Family

outside of the United States due to the services provided by the network. Further more DGX Los Angeles was nominated within the WCA network for the coveted top agent North America. The nominees are selected and voted for by their peers – displaying DGX’s outstanding performance within the network. The Dependable Group with its growth, consists of over 2,000,000 square feet of warehousing space operated under the name of Dependable Distribution Centers, and various companies in ocean and airfreight, operated under the names of DHX-Dependable Hawaiian Express, Inc, DGX, and Dependable AirCargo Inc.(DAX), a Customs Brokerage and CFS Warehouse in Los Angeles operating with the name Dependable Global Express, Inc, and a national LCL trucking, trailer load trucking and brokerage service and an intermodal division operating under the names Dependable Highway Express (DHE) and Dependable Logistics Solutions (DLS). With such a vast network of companies alongside the WCA Family of Logistic Networks the Dependable group is a single source for reliable, cost-effective shipments with superior customer service as a diversified, premier third-party logistics provider.

Cargo Airline of the YearTHE WCA Family of Logistic Networks recently sponsored an award at the prestigious Cargo Airline of the Year awards hosted by Air Cargo Media, producers of the famous Air Cargo News. David Yokeum - President of the WCA Family presented the award for Best

Middle Eastern Airlines to Jacqui Evans McArthur, Cargo Controller Express, Mail & Interline Emirates | SkyCargo. A wonderful night saw over 500 of the world’s top cargo airlines, airports and service providers come together. Present on the hosts table going clockwise from the lower middle are Malou and Ram Menen (Emirates SkyCargo Dubai), Gloria and Des Vertannes (Etihad Crystal Cargo Abu Dhabi), Maureen and Dieter Haltmayer (QCS Germany), David Yokeum (WCA Family Bangkok), Ray and Debbie Crane (Air Cargo Media), David Pook (WCA Family Bangkok) and Chris and Lisa Chapman (Chapman Freeborn UK).

Interesting and Unusual MovesITEM transported: 1 piece at 20Kgs. approximately 5mls of infectious H1N1. Dangerous Goods International took the infectious substance to humans and animals known as the H1N1 from the

CDC (Centre of Disease Control prevention) in Atlanta and had it flown into Stansted airport, UK where it was received and transported to NIBSC (National Institute for Biological Standards and Control) in Hertfordshire.

A NEW WEEKLY BULLETIN FOR VENDORS SERVICES

For more information please contact [email protected]