'One-Stop-Shop' Shipping Not Necessarliy Popular
“One-Stop-Shopping” Concept in Shipping Industry Not Necessarily Popular, Unisys Survey Finds
Industry consolidation viewed with concern by global shippers
Despite the billions spent on shipping industry consolidation in the name of efficiency and better customer service, almost three-quarters of large shippers would rather do business with several shipping providers than centralise their operations with one major supplier, according to a Unisys Corporation survey of global shippers released today.
The survey, which tackled questions relating to logistics services, information technology, security and regulations, found that 70 percent of those surveyed answered “no” when asked whether they expected to move to a “one-stop shop” provider.
Rather, many respondents indicated that they had an intentional, specific logistics strategy to diversify their business among multiple providers so as to encourage competition and lower prices. They felt that multiple suppliers keep prices and services competitive, and that often niche logistics providers deliver a better service, communicate faster, and are more flexible.
“These survey results demonstrate that costs and reliability are key priorities for shippers, so they understand the best services and modes to use for their business,” said Brett Hodgson, Managing Director, Unisys New Zealand.
The Unisys survey consisted of in-depth interviews with senior management from 52 major intercontinental corporations in industries such as technology, pharmaceuticals, food and retail. More extensive survey findings will be presented at the Unisys Logistics Seminar in Nice, France, October 3-6.
Other key findings of the Unisys survey include:
- Concern over fuel costs. Shipping customers are concerned that increasing fuel costs will force them to consider other alternatives – including diverting air freight to the sea - as a way to offset the rising costs of moving goods through the supply chain. When asked what would drive them to use more air cargo, three-fourths of respondents surveyed indicated that it would have to cost less.
- Air capacity an issue in Asia. The peak season surge in air traffic continues to be a significant problem for companies who have shifted their manufacturing or suppliers to Asia. Survey participants expressed mixed support for making long-term capacity agreements.
- Bigger not always better. Respondents overall felt that the bigger a logistics provider was, the less flexible and user-friendly its systems were. Survey participants were generally satisfied with the real-time information received from integrators and perceived them to have an IT advantage with one company managing the information chain.
- Security and regulations necessary evils. While most respondents believed in improved IT security, many respondents, concerned about the increased regulatory and security environment, asserted that anti-terrorism security and related regulatory requirements put the most pressure on their supply chains. However, they were resigned to the fact that security and regulations are here to stay and will likely continue to become more stringent.
- Supply chain visibility works. The majority of respondents surveyed felt that IT helped move things through the supply chain faster. The faster shipments moved, the less chance there was that goods would be stolen, they said.
The interviews for this survey were conducted by Triangle Management Services, a leading independent specialist management services company within the global mail, express and logistics sectors. The respondents in this survey have responsibility for intercontinental freight, distribution, logistics and supply chain management. The companies in this survey have, on average, annual global sales of $28 billion and annual intercontinental transport expenditures of $150 million.
Unisys is a worldwide technology services and solutions company. Our consultants apply Unisys expertise in consulting, systems integration, outsourcing, infrastructure, and server technology to help our clients achieve secure business operations. We build more secure organisations by creating visibility into clients’ business operations. Using Unisys 3D Visible Enterprise, we make visible the impact of their decisions – ahead of investments, opportunities, and risks.
For more information, visit www.unisys.com