How to Prepare for Ocean Contract Negotiations

It is that time of year for shippers to negotiate their annual contracts with ocean ?carriers. Making sure you’ve gathered vital information and aligned your strategies to get the most out of your contract can be a taxing experience. To make things easier, our?Carrier Allocation ?team put together a checklist to help you get organized and prepare.

Data Strategy

• Were you able to find an adequate number of ocean carriers to accommodate and transport your freight on schedule?
• Have you identified any positive or negative exceptions or trends in the service provided by different ocean carriers?
• Can you identify which ocean carrier strings were?more or less optimal?in transporting your freight?
• Have you determined which vendors performed on-time delivery and which experienced significant dwell time and delay?
• Have you determined which ocean consolidators provided the best service?

Sourcing Strategy

• Have you identified which lanes your organization will most commonly source from?
• Do you know whether or not there are specific compliance-related requirements on commodities to be shipped (e.g.?dangerous/hazardous goods,?oversized goods, or goods that require special packaging)?
• Do you know if there will be any expected peaks in volume throughout the year, such as seasonal surges?

Transportation Strategy

• Do you know if your strategy will be driven entirely by direct ocean contracts or by a combination of direct ocean contracts and Non-vessel Operating Common Carriers (NVOCCs)?
• Are you aware of the volume allocation between direct ocean carriers or the combination of direct ocean carriers and NVOCCs?
• Do you know if it will be?most optimal to negotiate at region, lane, or string level?
• Do you know which movement type will be most?efficient?and?cost-effective? Will it be port-to-port? Door to Door?

If you answered no to one or more of these questions, read the full article for more information on preparing for ocean contract negotiations .

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