Front and Center
SHIPPERS VS. CARRIERS
When maritime consultant Drewry interviewed large shippers to gauge the health of the logistics industry, several shippers were very open to the fact that the relationship between shippers and carriers has been severely strained, and in one case, “at an all time low”.
What’s the difference again?
The shipper is the company who owns the goods that are shipped (also called the consignor). The carrier is the company that transports goods on behalf of the shipper, and is responsible for the goods during transit.
Got it. And what’s the beef?
According to shippers, carriers are taking a “short-sighted” approach by taking advantage of the recent spike in demand, and in so doing tarnishing long-standing relationships.
“Relationships with carriers count for nothing these days,” said one large European shipper. “The carriers are very opportunistic and take high-rate spot shipments rather than contract shipments – it is all about money.”
They sound bitter.
They have reason to. There have been cases where carriers do not honor their contractual MQCs (minimum quantity commitments), in an effort to secure spot shipments for additional profits — spot shippers transport goods “on the spot”, not through a contract, and therefore can charge an extra premium for the service. Additionally, carriers have recently chosen to cancel trips altogether in the U.S. to find greater profits elsewhere, leaving shippers scrambling to find spot shipments or NVOCC (Non-Vessel-Operating Common Carrier) which always charge a higher price.
Someone should help them work it out.
Well, the European Shippers’ Council has voiced their concerns to the European Commission, asking for an investigation into the carriers’ allegedly predatory behaviors. We hope they’ll hug it out soon.
Back of the Packet
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