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Freight forwarders turn to SOCs to face global container shortage

The percentage of top 50 freight forwarders accepting shipper owned container (SOC) requests grew from 6% in 2019 and 10% in 2020 to 18% in 2021, according to the annual 'Mystery Shopping SOC report' by Container xChange, an online container marketplace.

"Though there is considerable improvement in demand for SOCs, the major forwarders are yet to fulfill the demand for the boxes on the route from China to Germany," commented the Hamburg-based company.

"SOC increases reliability for empty container availability. The downside is that you need a dedicated team/person to manage these shipments," said Florian Braun, head of ocean freight, EMEA, at Flexport.

Furthermore, Christian Roeloffs, founder and CEO of Container xChange, believes that forwarders are increasingly positive about SOCs but are also uncertain of the success of processes around them.

The rise in awareness for SOCs shows that industry participants are responding to the supply-chain pressures by diversifying their sourcing strategy, according to Roeloffs, who stated, "We've observed a growing year-on-year acceptance for SOCs as well as demand to improve the management costs and efforts. We believe the solution lies in digitising the process to enable forwarders with a seamless, hassle-free opportunity of using SOCs."

In December 2021, Container xChange put to a test the world's 50 largest freight forwarders to investigate how they respond to SOC requests. They reached out to ship industrial machinery parts from Shanghai to Hamburg using SOC containers and here is what the report findings show:

  • 18% of the companies that were tested were able to organise the SOC move and source the containers without any restrictions. This figure of 18% compares to 10% of the companies in 2020, and 6% in 2019.
  • SOC acceptance and awareness have grown over the last three years. 90% of the respondents were clued up on the SOC market compared to 68% of respondents last year and 35% in 2019.
  • Hitachi Transport System was one of the most helpful freight forwarders, even offering us 'reasonable' pickup charges. While last year the winners were Kuehne+Nagel, CEVA Logistics, Hitachi Transport Systems, Nippon Express and Kerry Logistics – in 2021 it was GEFCO, Hitachi (again), Yusen Logistics, Landstar, Mainfreight, Kintetsu World Express, FedEX, BDP International and Millenium Cargo.
  • This year, the lower cohorts outperform the top 10. The top 10 were already saturated with business, especially leading up to the festive season. Evidently, SOC is becoming more and more possible for a range of freight forwarders. (Cohort 1 = Rank 1 – 10, Cohort 2 = Rank 11 – 20 etc.)

One of the recent surveys by Container xChange in January 2022 which canvasses 500 freight industry respondents also pointed towards one-fourth of the respondents considering making use of SOCs as one of their container sourcing strategies into the year 2022.

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