03 Mai The spot freight market ?
The spot freight market in the liner shipping industry has developed significantly in recent years and interplays with the long-term contract between carriers and shippers.
In the shipping industry, 3 procuring structures are then considered:
- from carrier with long-term contract,
- only from spot market,
- from both of these channels.
By taking into account both the carrier’s long-term decision (on freight rate) as well as the shipper’s long-term decision (on shipment capacity procurement amount) and spot market supplementary procurement decision, it shows that dual channels play different roles for the shipper.
Although the spot market is not favorable for the carrier, it increases both the shipper’s utility and the carrier-shipper’s overall performance.
The shipper is cautious and careful facing market uncertainty.
Good contracts help you control costs and avoid expensive add-ons.
Freight Bids and Spot freight Market
While it is certainly beneficial to have negotiated freight tariffs with dedicated carriers, you can complement your consolidated transportation strategy by going to the spot market to get competitive bids or by asking for comprehensive bids for your total annual freight volumes.
In essence, testing the marketplace not only allows you to best match your transportation requirements with true carrier capacity and reduce costs, but can ultimately provide your dedicated service partners with a better sense of your overall freight requirements and an opportunity to re-assess their own tariffs.
It also allows you to take advantage of special one-time options and discounts based on availability, as when a carrier’s urgent need to « fill a container » coincides with your particular volume and timing requirements.