With volatility in the freight markets almost becoming an everyday affair in international trade, building global supply chain resilience is increasingly becoming a necessity for businesses. Businesses battle natural and man-made headwinds to operations of critical supply chains, intensifying their search for strategies to ensure success. In such an environment, SCL shipping can be a game-changer in ensuring supply chain resiliency.
SCL shipping offers flexibility and cost-saving opportunities, which are key to enhancing the resilience of global supply chains. This article explores how businesses can leverage these benefits to strengthen their operations.
1. SCL Shipping Mitigates Risk
While shipping is a key aspect of any supply chain operation, it is also the segment where businesses are exposed to several risks, including delays, damages, and unexpected costs. SCL shipping looks to smoothen freight operations at an optimized cost, by picking the best attributes of less-than-container-load (LCL) shipping and full container-load (FCL) shipping. SCL shipping offers the safety that comes with shipping FCL at a price point and flexibility that is a notch better than LCL shipping.
This allows businesses shipping SCL to operate more agile supply chains. Achieving supply chain resilience also involves designing efficient supply chains that can respond effectively to disruptions without compromising on performance.
Here is how:
Increased Diversification and Reduced Disruption
The nature of SCL shipping is such that businesses only have to ship what they want at any particular time. These businesses do not have to leverage FCL shipping because they can always partner with other businesses to fill up the container and reduce shipping costs. This means businesses don’t have to commit much to a single shipping line.
This way, the shipments are diversified, and any issue with one can be easily managed. It also minimizes the impact of disruptive factors like port congestion, transloading issues, or geopolitical events on operations.
Improved Inventory and Supply Chain Management
Inventory management is another critical aspect of any supply chain operation, mainly because of the amount of capital committed to it. This is why SCL shipping is so important for businesses. Like the LCL shipping option, it allows businesses to enhance their supply chain planning and ship what they need without worrying about cost. This is important because it reduces shipping and inventory holding costs.
Because SCL shipping allows businesses to ship what they need when they need it, they enjoy more flexibility and eliminate the risk of inventory obsolescence, which could be quite costly for the supply chain.
2. SCL Shipping Improves Cost Efficiency
Cost is a major aspect of any agile supply chain operation. Reducing the cost of supply chain operations will be significant in a dynamic era with increasing exposure to varying risks. It allows businesses to save more and ensures the cost doesn’t rise astronomically, even when things are volatile.
Here is how SCL shipping can help with cost savings.
Cost-Effective Shipping Solution
The nature of shared container loads allows businesses to ship a significant amount of goods while reducing the cost of shipping. This makes the shipping solution much more affordable than FCL for smaller shipments. However, like LCL shipping, it becomes counterproductive after a certain volume. That is why it is only for shippers shipping less than full container loads.
Shipping only what is necessary saves cost for the supply chain on two fronts: reduced inventory holding cost because businesses only have to ship what they need rather than being forced to take advantage of the full container. It also reduces the cost of shipping for these businesses. So, the SCL freight is cheaper than the FCL and the LCL shipments at certain volumes.
Optimized Capacity Utilization
The problem with container shipping is that shippers are forced to make the most of it, and in many cases, they do not have the volume to make it work. However, with an SCL shipping solution, shippers can ensure no wasted resources, including reduced empty container spaces. This also enhances the efficiency of the entire shipping process.
3. SCL Shipping Promotes Sustainability
As the world grapples with the effects of uncontrolled carbon emissions, sustainability has become a main feature, streamlining and enhancing the quality of operations. The link between sustainability and resilient supply chains is that businesses eliminate unnecessary processes in the supply chain that only pile up sustainability issues. This makes the operation much more effective.
Reduced Carbon Footprint
With SCL shipping, there is no need for two businesses to ship containers that are half-full. They can always share the same container, and when enough businesses do this, the carriers don’t have to move as much. This consolidation model reduces carbon emissions for all stakeholders involved in the process. It can make a significant impact since logistics operations amount to 7% of global greenhouse gas emissions.
As detailed earlier, SCL shipping consolidation also has immense benefits for the shippers, such as cost savings and improved inventory management. But beyond that, it also enhances the businesses' appeal to customers. Consumers are willing to pay 10% as a sustainability premium.
How Silq Leveraged Its SCL Shipping Solution to Help a Business Improve Supply Chain Resilience
A mid-sized importer of organic produce was facing a familiar dilemma. Their shipments from Southeast Asia were often too small to justify a full container load (FCL), yet the traditional Less-than-Container Load (LCL) option meant frequent delays and unpredictable costs.
Balancing inventory needs with shipping expenses was a constant struggle, and unexpected supply chain disruptions often left them scrambling. Then came the pandemic, throwing global supply chains into chaos. Shipping costs skyrocketed, delays became the norm, and the company's carefully crafted logistics plan was in tatters.
It clearly needed a solution offering cost savings and resilience against future supply chain disruptions. It would have been nice if it could leverage domestic supply chains and businesses, but that was out of reach. These problems triggered its partnership with Silq. The digital freight forwarding platform presented a fresh approach: Shared Container Load (SCL) shipping. The concept was simple: share container space with a vetted business, paying only for the space you use.
Initially hesitant, the produce importer decided to give it a shot. The results were transformative from the jump. Silq's platform provided transparency and real-time tracking, offering peace of mind amidst uncertain times. The guaranteed weekly sailings meant no more rolled shipments, ensuring a steady inventory flow.
Through Silq's SCL solution, the company weathered the storm and emerged stronger. It began running an efficient supply chain that achieved significant cost savings, improved inventory management, and built a more resilient supply chain to withstand future challenges. It was a win-win situation for their business and the planet, as SCL's consolidation model also reduced their carbon footprint.
Leveraging Silq’s SCL Shipping Solution
Ocean consolidations aren't designed for high-volume shippers, but Silq's SCL shipping solution flips LCL on its head to cater to these volumes. Silq SCL shipping is the cheapest way to move shipments between 15-50cbm, period. As a shipper, you will ship alongside accredited shippers with no more than three shipments per container. This way, you only pay for what you use without slowing down your supply chain networks.
Shipping and supply chain managers love Silq because it leverages people, supply chain data, and innovations to ensure optimized and robust shipping operations. Get started with us today to see the difference.
