“Your cargo has been rolled.”
Not only does that statement elicit groans from customers, it causes delayed cargo, more administrative work and often additional commercial costs.
“With our newly launched loaded as booked quality promise, we spare our customers these headaches and inconveniences by promising to load more than 95% of their confirmed bookings on the exact ship specified in the reference or first booking confirmation,” Hapag-Lloyd Aktiengesellschaft (OTC: HPGLY) announced Thursday.
Juan Carlos Duk, Hapag-Lloyd’s managing director of global commercial development, said the German container shipping line promises to “significantly lower the number of rolls and make the lives of our customers a lot easier by improving their supply chain flow, boosting their planning security and reducing administrative work related to rolled cargo. As a result, in addition to saving time that they can devote to other important tasks, our customers will save money thanks to reduced commercial costs and liabilities.”
Hapag-Lloyd said it set the goal to “differentiate through quality” with its Strategy 2023, which includes initiatives focused on network optimization, terminal partnering and procurement improvement.
“At the core of the new strategy is an enhanced differentiation by offering unrivaled levels of reliability and service quality,” Hapag-Lloyd said when it unveiled its strategy in November 2018. “Hapag-Lloyd is making changes to its structures, systems, processes and operations and focusing single-mindedly on delivering customers a better and more efficient experience in their supply chains.”
CEO Rolf Habben Jansen said at the time, “Going forward, delivering value to get the most attractive cargo on board is at the heart of our new Strategy 2023. To be number one for quality is the ultimate promise to our customers and a strong differentiator from our competitors.”
He had no idea then that a pandemic would disrupt the global supply chain — and sink profits. Hapag-Lloyd reported first-quarter 2020 net profit of about $27 million (€25 million), down from approximately $103 million (€96 million) in the same period the prior year.
In discussing Hapag-Lloyd’s first-quarter results in May, Jansen looked to the light at the end of the coronavirus tunnel and said the company would “slowly but steadling start shifting again more to business as usual and start refocusing on the things that we have identified in the context of our Strategy 2023.”
Hapag-Lloyd launched what it said were three quality promises — fast booking response, timely and correct bills of lading, and accurate invoicing — in January. Six more are slated to be published between now and the end of 2021. Hapag-Lloyd said customers can monitor its performance through the Quality Promise Dashboard.
Beginning in September, online business users will be able to access a personal section of the Hapag-Lloyd Navigator and see where the shipping line stands in terms of delivering on its quality promises in relation to individual customers’ transactions.
Hapag-Lloyd said an evaluation of the first six months of 2020 shows it has been able to significantly improve performance with its already-released quality promises.
“We see that our various measures to improve our operational performance are paying off,” said Jesper Kanstrup, Hapag-Lloyd’s senior director of customer quality.
Hapag-Lloyd has a fleet of 248 container ships and a capacity of about 2.6 million twenty-foot equivalent units. The company has approximately 13,000 employees and 394 offices in 129 countries.
Hapag-Lloyd outlines selective growth in Strategy 2023
Higher costs hurt Hapag-Lloyd more than coronavirus in Q1
Hapag-Lloyd cutting costs while riding out pandemic
Click for more FreightWaves/American Shipper articles by Kim Link-Wills.
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