Research is a vital part of any business, and that is the case with Shipping and Logistics in Dubai as well. You must do your research before shipping your cargo to its intended destination to ensure it arrives safely and quickly. No company would trust their precious cargo with just anyone. For that, it should be the best Logistics Company in Dubai.
There are always going to be obstacles and delays, even for the most experienced players in the industry, but many of these can be avoided altogether with proper planning, communication and commitment.
As a result, many shippers begin to wonder whether it is best to work directly with carriers and forwarders. The purpose of this article is to discuss the pros and cons of doing just that.
Companies are increasingly considering the possibility of working directly with the Shipping and Logistics in Dubai as a strategy. Someone in your network likely has experience doing this if you have been in business for a while.
In making an informed choice, you need to speak with your colleagues about their experiences as part of your crucial research process.
Having an understanding of the consequences of your decisions and the risks you take is just as important.
Most businesses prefer to work directly with companies that offer Shipping and Logistics in Dubai because they are trying to get the best shipping rates in addition to the best possible service. Surely the best rates come straight from the source, right?
VOCCs, or vessel-operating common carriers, are the companies that actually move the cargo. Containers and vessels owned by these VOCCs are used to transport cargo from port to port. Their responsibility is to deliver everything you ship to its destination.
A simple analogy can easily identify a major flaw in this method of thinking.
Even though we all wear shoes, going straight to the shoe factory is not the best way to get the best price. There aren’t enough pairs of shoes sold to justify all the hassle, and the shoe factory understands that as well. It’s because of this that there are middlemen who buy in bulk and sell individual items to consumers.
Likewise, VOCCs have placed restrictions to avoid having the hassle of dealing with “small-time” customers. VOCCs are unable to justify working with shippers with low TEU volumes without unlimited resources. The back-and-forth would be unnecessarily ongoing without much reward for them.
Courier Services in Dubai that move a lot of cargo can greatly benefit from signing a contract with a VOCC and working directly with them. Especially if your business moves a large amount of cargo, this can save you money from a financial standpoint.
By cutting out the middleman, you are able to work directly with VOCCs. In any case, that reduces businesses’ costs since you’re eliminating an intermediary that would otherwise take a cut out of your pocket.
It’s not all about money, though. Shipping availability and service quality go way beyond price for giant retailers and chain stores that require a constant flow of merchandise regardless of weather and other events. Most of the time, these factors are even more important than the price, as these companies are willing to pay more for reliability.
There’s nothing wrong with working with NVOCCs and Freight Forwarders from the leading Shipping and Logistics in Dubai; indeed, it’s a common practice for a number of different industries.
The promise of low rates is something to keep an eye out for. There is no guarantee that you’ll get the “lowest freight rates”, as these rates change constantly. Due to the volatile nature of the market and numerous constantly changing factors (such as vessel space, fuel costs, and actual supply/demand), the “best rate” is actually always fluctuating and highly unpredictable.
In many cases, if you end up shipping cargo and coming in at a slower rate than expected, that is a great thing. It means you’re overpaying despite previous projections if the market is low and your competitors are paying even less than you. Furthermore, because internal resources may be limited, it may be necessary to make changes at a moment’s notice.
NVOCCs can help in this situation. Shippers are strongly encouraged to work with an NVOCC that can legally operate as a cargo carrier. Additionally, they will issue a Bill of Lading and accept full responsibility for the cargo.
There are a few pros to NVOCCs, such as the fact that they work with more than one shipper. Additionally, they commit large volumes to multiple VOCCs, which means more buying power and, more importantly, lower rates.
The use of mega-ships is on the rise, and global trade has not seen great growth due to the need for more VOCCs to restructure their operations. The company has reduced how many ports calls it makes and changed its service loops, so shippers now have fewer options.
A VOCC may become more flexible by using shipping alliances to offer more than one sailing schedule for each port instead of just one.