Unanticipated events continue to disrupt global trade, making sustained business success a serious challenge. Risk evolves quickly and can force organizations to adapt their ongoing plans or abort them completely.
Partnering with a fourth party logistics (4PL) service provider allows your company to overcome pressing obstacles—COVID restrictions in major ports, resource scarcity due to conflict, or blocked air and rail connections—among many other examples.
Below are several cases where OIA Global 4PL helped customers overcome critical disruption.
Supplier & Materials Shortages
A global customer specializing in fast moving consumer goods (FMCG) faced logistical disruptions due to shortages of crucial raw materials in their manufacturing facilities. Disruption in the customer’s standard ocean connections resulted in increased lead times, which subsequently impacted manufacturing and the quality of goods. Serious issues first began in late 2021 and spanned across multiple regions.
From the start, OIA Global 4PL recognized that the right solution would require detailed planning and a period of exploratory trials.
- OIA mitigated ongoing port omissions from Northern European ports towards the Arabian Peninsula and Egypt by exploring alternative shipping routes through Southern ports.
- OIA then found various multimodal transport options via truck, barge and rail.
- Different options were tested to see which connection would best enable movement of the blocked cargo, and to determine the most economical options for both the intake port and destination port.
Amidst disruption, OIA worked intensely with key partners to regain supply chain stability, unblock the bottleneck and source alternative means of transport with shortened lead times.
Suez Canal Crisis
The vessel blockage in Egypt’s Suez Canal—one of the world’s busiest trade routes—made newspaper headlines throughout the world in March 2021.
With no opportunity to directly influence the outcome, OIA quickly established a taskforce, the ‘Suez Crisis Committee’, to monitor the blockage’s impact and communicate it to customers. Special attention was given to customers with cargo on board the trapped vessel, as well as customers with cargo being diverted around the blockage.
- OIA monitored vessel movements to identify any signs of blockage being cleared.
- The Suez Crisis Committee highlighted impacted shipments amongst numerous others.
- The team disseminated daily status updates to customers as needed.
The committee maintained close contact with ocean carriers and suppliers at origin in order to better understand contingency plans for rerouting newly departed vessels and/or cargo already at the terminals. Customers could then decide if they wanted to deploy replacement orders to sail on temporary, alternative routes while rescue teams worked to free the ship.
Port Omissions & Reduced Sailings
In March 2022, OIA’s customer faced port omissions on their shipping lanes to Ashdod, Israel. Unfortunately, contracted carriers were unable to offer any reliable alternatives.
OIA’s team perused their network of carriers to find alternative solutions and contacted them accordingly. In this instance, OIA was able to negotiate critical space on ZIM vessels because of a prior positive experience with ZIM, which in turn allowed the customer to avoid transit delays and port-omissions at key locations. Once usual services resumed, shipments were re-secured on previously contracted routes.
In the past, reduced sailings on major trade lanes—MSC’s direct Australia Express service for example—have required OIA Global to seek adequate alternatives that ensure forecasted shipment volumes can still be loaded within deadline and arrive on time.
OIA Global 4PL collaborates with shippers to ensure that appropriate transit times are built into lane calculation criteria. This allows customers to place orders with confidence, knowing that extended transit times or expected delays at transshipment ports are considered in advance.
Mexico Southbound Transit
A shortage of trucking resources has jeopardized cargo flow across North America since 2019. This has been a major challenge for many, and especially for one OIA customer facing a critical supply backlog, extending for months, for cargo on a southbound route toward Mexico.
OIA’s project logistics team worked closely with the customer’s account managers and purchasing teams to acquire more reliable suppliers and haulers. OIA already possessed a strong network of northbound suppliers, so they investigated the potential for haulers to adopt round trip southbound services. Established partnerships with key haulers enabled OIA’s operational teams to clear the initial backlog, and in general, to find a solution that could be adopted again in the future.
Overall, OIA’s actions resulted in a new contract agreement with the supplier, providing long-term, cost-effective stability while also expanding the scope of work with a trusted partner.
Author
Joris Nijman
