Sustainable Solutions for a Supply Chain Challenge
How many of us gave any thought to international supply chains before the pandemic? We took for granted that goods shipped from overseas would reach our store shelves. Now we are aware of the impact of disruption to supply chains and freight transportation. We have a newfound appreciation for truck drivers as we see them hauling containers filled with imported goods from our ports. What we don’t realize is that almost half of those containers are transported back to the port filled with nothing but air. In other words, many of the containers you see on the road are empty which is inefficient, costly, and harmful to the environment.
The repositioning of empty containers is a problem that has plagued maritime shipping for decades. It costs the industry $20 billion annually and emits 19 million metric tons of emissions. The answer to the problem is street-turns which occur when an import load is matched with an export booking inland, eliminating empty container transport to and from our ports. So why is the execution of street-turns not a standard practice?
Industry players have been unable to effectively perform street-turns on a large scale due to a lack of transparency or ability to share information between parties in the supply chain. Importers don’t know where the export shippers are and vice versa. Truckers or forwarders only see the shipments they manage. Their systems are not set up to connect with each other so the data is fractured across the industry.
Companies handle thousands of imports and exports every day, creating millions of street-turn opportunities. Finding the best container matches among so many options is a complicated and costly process. Freight planners do not have the time nor the systems required to turn mountains of unstructured data into usable information. Historically, street-turns have been identified in an ad-hoc and manual way, if at all, and usually restricted to a company’s own operations.
The issue is less a transportation function and more of a data and technology challenge. MatchBack Systems, a logistics software company, seized the opportunity to tackle this age-old problem and move a traditional industry forward with innovative solutions while having a positive impact on the environment.
It’s now possible to manage a complicated process on a large scale to benefit all international container shipping by reducing overall costs and wasteful operations.
MatchBack Systems designed unique optimization technology to automate the street-turn process, helping companies to manage this complex activity in a systematic and scalable way. A planner simply loads their container information into the system which applies advanced algorithms to quickly analyze all the options, making it possible to identify and plan container matches across a company’s network within minutes.
To maximize results, the software optimizes data to predict high-value, high-frequency street-turns that can be systematically paired every time they occur. As the system processes data, it uses machine learning to look for patterns and trends that provide useful intelligence or present new business opportunities.
The company also provides a neutral, collaborative platform to digitally connect all key parties in the supply chain, including shippers, ocean carriers, logistics providers and truckers. This enables participants to work together, communicating and executing mutually beneficial street-turns that would otherwise have remained hidden outside of their internal process.
By unlocking previously unattainable street-turns, it’s now possible to manage a complicated process on a large scale to benefit all international container shipping by reducing overall costs and wasteful operations.Each street-turn saves $150-$400 in direct transportation costs and $200 in indirect costs while 400 pounds of CO2 are eliminated every time an empty container move is avoided. It’s a sustainable solution in a world where environmental regulations are increasing and businesses look to reduce their carbon footprint.
In a pandemic era, when companies are whipsawed by rapid changes in supply and demand, there’s a heightened awareness of the value of street-turns. Many pieces are required in the logistics puzzle of matching containers but now industry players have solutions allowing them to join their pieces together to complete the picture. The result? Fewer containers on the road transporting air, more efficient supply chains shipping your goods, and fewer emissions polluting our atmosphere.