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Robert.Jervis_43227 Jun 25

Maersk spots a gap in the market

Maersk spots a gap in the market image

Maersk introduces Maersk Spot, a new fully online product that simplifies the buying process for customers

Maersk has expanded its product offering with Maersk Spot. Fully digitally enabled, the new online product provides customers a cargo loading guarantee at a fixed price upfront. With the launch of the new product, Maersk takes further steps towards simplifying the supply chains of its customers by addressing some of the fundamental inefficiencies that exist across the industry.

“It is not uncommon to see overbookings to the tune of 30%, and often this leads to rolling of the customers’ cargoes since there is overbooking to compensate for the high downfall. This creates a lot of uncertainty for our customers,” says Silvia Ding, Global Head of Ocean Products at Maersk.

“With Maersk Spot, we provide full visibility of the price and terms that will ensure cargoes get on board. Ultimately allowing customers to move their cargo in a much simpler and more reliable way.”

With Maersk Spot, customers can search and get competitive rates online 24/7. The all-in price is calculated and fixed when the booking is confirmed, which happens instantly. This dynamic online pricing fixed at booking creates one transaction for the customer from quotation to booking confirmation, profoundly simplifying the buying process.

“Maersk Spot radically simplifies the buying experience for our customers. Today’s offline process can be up to 13 individual steps, often involving a lot of communication and paper work from rate sheets to terms and conditions and surcharges, etc. With Maersk Spot, this cumbersome process is reduced to five simple and integrated steps – all online,” says Ding.

When a booking is confirmed by the customer, Maersk commits to load and grants certainty in operational execution. This is a mutual commitment between the customer and Maersk which ensures that the vicious cycle of overbookings is addressed. In case of booking cancellations, fees apply at the customer’s charge. If cargo is rolled, Maersk compensates the customer. The mutual commitment paired with increased visibility of sailings and certainty of prices has been to date embraced by more than 3,000 unique customers each week, with already over 50,000 Forty-Foot-Equivalent (FFE) units booked in Q2.

One of the customers already using Maersk Spot is The Ramco Cements Limited. The company sends around 120-200 containers from Kattupalli port to Colombo every week, making their bookings one to two weeks in advance to ensure they can deliver to their customers on time with the best deal possible.

“We are quite proactive about our bookings but there were still cases where our shipments were not loaded due to capacity issues which resulted in the loss of trust with some of our customers,” says Ramakrishnan Vivekanandan, General Marketing Manager of The Ramco Cements Limited.

“With Maersk Spot, we no longer have the uncertainty of not knowing if we can actually provide our customers with their shipments.”

Maersk Spot is now available on all trades, except in and out of U.S. Currently available as BETA site, the product will be implemented on at the beginning of August.

The following is an article from Ti about Maersk:-

Soren Skou’s new Maersk

Maersk’s CEO has been discussing his company’s corporate strategy. In an interview that appeared in the Wall Street Journal, Soren Skou outlined his plans for the future of the largest container shipping company.

He did not mention any specifics that have not been communicated by Maersk previously, however the company that he describes is very different from how Maersk looks today. For example he asserts that “today up to 80% of our earnings comes from container shipping….hopefully a couple of years from now will be much closer to a 50-50 scenario between ocean and non-ocean services.”

Skou specifically mentioned that Maersk was looking to provide inland, non-marine related physical asset services for major clients: “We want to run the warehouse, receive the goods, stuff it into containers, ship it to the U.S. and provide a data feed that says the yellow swim trunks are in that box…then we take it out of the containers, and send the goods by trucks to distribution centres closer to the final delivery point.” This is a description of a contract logistics operation.

Bearing in mind the degree to which AP Moller Maersk has already transformed itself through the sale of assets in order to concentrate on shipping and ports, the shift to half its business being non-marine logistics suggests that the company will continue a process of transformation at a furious pace. Maersk has been investing in physical assets, such as a new cold store in St Petersburg. It has also been investing in transformative web-based booking and visibility tools. Of course, it still owns a freight forwarder. However, to shift its business away from shipping so dramatically will take a lot of investment or a large acquisition.

Soren Skou’s remarks also strongly suggest that Maersk will become a direct competitor of the major forwarders and logistics service providers. This is not unique, with CMA CGM’s acquisition of Ceva being a direct challenge to such companies who are also large customers. Nonetheless, the markets he is entering are marked by strong competitors and making any business here profitable will demand a lot of work. Container shipping may be characterised by poor margins and low returns on capital, however forwarding and contract logistics is hardly easy.