Shippers won't take blame for air freight firms' woes
It is up to service providers to charge enough to stay solvent
Shippers are “unmoved” and "incredulous” over suggestions that they might be to blame for the financial problems that many air freight companies have faced over the past year, according to research by The Shippers’ Voice web forum.
Managing partner Andrew Traill, on the basis of opinions canvassed late last year and in January, said: “While many observers might say that shippers had it good for the first half of 2009 with the slump in rates, they therefore had little to complain about when the rates soared in the second half.
“But most shippers I have spoken to say they simply took advantage of the rates carriers were offering, and that it is up to the service providers to make sure they earn enough money to stay solvent.”
He quotes one shipper, Berndt Herrmann, of Siemens. When asked if he and his colleagues in the supply chain management team felt in any way culpable for putting pressure on airlines for extremely low rates earlier in the year, Herrmann said: “Not at all – this is a question of the market and how people seek to offset their positions in order to manage the situation.”
A shipper from a major UK pharmaceutical company was critical of the service providers. He said: “They [carriers] should not have allowed rates to dip so far in the first place.
“However, this peak and trough, boom and bust, practice with rates is in nobody’s interest.
“Shippers need consistency and predictability in their costs, and they also need carriers to invest for the future, so very low (unsustainable) rates help nobody in the long term.”
Traill said the the consensus among shippers was that they needed to work jointly with forwarders and carriers to enable the air freight sector to recover some of its stability.
“We all need to look at the whole of the customer’s businesses and understand how we can supply them better,” said one shipper.
“Failing to do this will result in the carriers failing to know exactly what we need, and so providing what they believe we need, which can sometimes be miles from the truth.”
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Managing partner Andrew Traill, on the basis of opinions canvassed late last year and in January, said: “While many observers might say that shippers had it good for the first half of 2009 with the slump in rates, they therefore had little to complain about when the rates soared in the second half.
“But most shippers I have spoken to say they simply took advantage of the rates carriers were offering, and that it is up to the service providers to make sure they earn enough money to stay solvent.”
He quotes one shipper, Berndt Herrmann, of Siemens. When asked if he and his colleagues in the supply chain management team felt in any way culpable for putting pressure on airlines for extremely low rates earlier in the year, Herrmann said: “Not at all – this is a question of the market and how people seek to offset their positions in order to manage the situation.”
A shipper from a major UK pharmaceutical company was critical of the service providers. He said: “They [carriers] should not have allowed rates to dip so far in the first place.
“However, this peak and trough, boom and bust, practice with rates is in nobody’s interest.
“Shippers need consistency and predictability in their costs, and they also need carriers to invest for the future, so very low (unsustainable) rates help nobody in the long term.”
Traill said the the consensus among shippers was that they needed to work jointly with forwarders and carriers to enable the air freight sector to recover some of its stability.
“We all need to look at the whole of the customer’s businesses and understand how we can supply them better,” said one shipper.
“Failing to do this will result in the carriers failing to know exactly what we need, and so providing what they believe we need, which can sometimes be miles from the truth.”
To read the full article, click here
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