Cargo Express Gains Global Visibility

June 25, 2009
The key to effectively managing ocean freight has always been visibility into shipments from point of origin, says Joe Pfender, co-founder and president of Cargo Express. “We had limited shipment visibility through our partners, and we found gaps in the system because various carriers simply weren’t sending messages. We knew we needed to set things up internally so that we could take control of the process from the source, and help our customers streamline their shipping operations.”

A leading shoe manufacturer customer with production facilities around the world was a major player in driving a visibility initiative at Cargo Express. "Our customer was a big driver of this program," Pfender says. "They were moving a lot of product that ended up sitting in loaded containers. They needed to find a way to better manage the movement of inventory from the day a purchase order was received at the factory to the final delivery of the goods."

The shoe manufacturer shipped goods directly from several factories in southern China to their distribution center in the United States. A consolidation facility in Shenzhen helped the manufacturer match production with demand. Bar-coded cartons coming into the consolidation point would generate a warehouse receipt, which would automatically send a notification to the manufacturer to issue routing instructions.

Cargo Express found that gaining visibility into its customer’s shipments involved a lot of manual processes. There was also no control over what was leaving the factory facilities. “While our customer was presented with details about each shipment at the consolidation point, it was too late to manage that flow,” says Pfender. “At that point they were facing fixed shipping windows and needed to get product moving, whether it was a rush item or not.”

As a result, the shoe manufacturer ended up paying demurrage charges and significant per diem invoices because they were not ready to receive their shipments. “The factories are naturally focused on production and not container loading efficiency. They made the shoes and pushed them out the door.”

While surcharges were one impetus, “better visibility would enable us to drive efficiencies for container usage and lower freight costs,” says Pfender.

Cargo Express was able to transition its customer to the Descartes GLN and gain visibility into its warehouse loads. Real-time Warehouse Receipt Advice messages (EDI-944) were sent to the manufacturer. With insight into product availability when shipments were received by the warehouse, the manufacturer could provide loading and shipping instructions based on immediate demand and distribution needs. The manufacturer then conveyed loading and shipping instructions via Warehouse Shipping Orders (EDI-940).

The shoe manufacturer can now take advantage of routing options such as all-water transit instead of mini-land bridge services resulting in lower ocean freight charges, Pfender explains. “For example, if our customer doesn’t need product immediately, they can switch that shipment to another vessel with longer ocean transit time at significantly lower ocean freight costs than an intermodal route.”

Cargo Express reports the Descartes GLN system helped this shoe manufacturer significantly reduce demurrage charges incurred when containers are kept beyond the allotted time frames. “Invoices for demurrage charges could result in significant unplanned cost–in some cases hundreds of thousands of dollars,” explains Pfender.

Founded in 1996 in Yardley, Pennsylvania, Cargo Express, LLC is a transportation logistics solutions provider that specializes in ocean import/export. As part of its day-to-day operations, Cargo Express coordinates intermodal and domestic transportation services across rail, truck and air; consolidates shipments from various manufacturing operations on behalf of its clients; and provides customs brokerage services to ensure the clearance of goods through US Customs. The company has contracts with over 15 different shipping lines and operates in 21 different countries on six continents. Its primary area of focus is the Trans-Pacific trade lane.

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