Stabilizing Production and Sales with Response to Global Container Shortage in 2020
The COVID-19 pandemic turned the world upside down in 2020. Global trade came to a sudden halt in the first half of the year. In the maritime transport industry, it was a race for survival. During the second half of the year, however, a wave of pent-up demand emerged due to lockdowns, home economy, working from home and frantic stockpiling attempts, causing global shortage in freight containers. FENC was on the benefitted end of this wave of pent up demands and saw a gradual increase in customer orders. However, such recovery was cut short by the container shortage. The Shipping Department, which oversees the shipping of Company products reduces the cost increase and mitigates the impact of such shortage with the following proposals:
- Obtain priority status in slot-chartering by building rapport with container carriers and charter the slots 1 month in advance.
- Locate bulk carriers and switch to reefer containers as supplement.
- Work with local carriers at the destination and utilize multiple transportation modes.
- Monitor the freight market dynamic and costs for maritime/air shipping on a weekly basis to reflect the latest fluctuation in costs.
- Engage in price negotiation with carriers to ensure fair price and competitive edge.
- Collaborate with various industry associations in Taiwan, seek government initiative to form International Maritime Transport Stability Working Group, and requests assistance from carriers, such as higher supply in empty cargos, slots, carrier shifts.