Limitation of Current Solutions

The good news is that the market is beginning to take steps towards improving the information flowing to customers regarding the whereabouts of their shipments, The bad news is:

• Current solutions require considerable infrastructure to be built at several points along the shipping route.  This is not only costly but also difficult to implement.  It requires negotiations with several parties, including dock operators, rail operators, as well as unions.

• Current solutions require the cooperation of multiple parties in the shipping process (e.g. third-party logistics providers "3PLs", port and rail operators, shippers, manufacturers, retailers).  The full cooperation of these various interests is extremely difficult to achieve.

• This information is rarely in real time – it is usually provided at a few “choke points” along the desired route of a shipment.  The time between choke points can range from several hours to 2 weeks or more.

  • If a problem occurs and the shipment strays from the planned route, the customer will not be made aware of it until it reaches the next choke point.  By that time, it may be too late and the shipment might never be located again.

• If a container is broken into and goods are stolen, the customer will likely not find out about it until the shipment has already arrived.

  • Cargo theft, loss, and damage continue to pose serious problems for the shipping industry. Total reported losses due to theft are estimated at $50 billion annually.

• The information that is available is very limited.  Key pieces of information are not available, such as:

  • Was the container opened at any point along the journey?

  • Did the container come in contact with any radiation or harmful chemicals?

  • Is the internal temperature within a range that the goods can tolerate?

  • Was the container tipped or dropped, beyond maximum tolerances?

  • And virtually any other piece of information that the senders, receivers, shippers, and insurers would like to know…

What this all adds up to is poor information. Once a shipment has left the manufacturing facility, the best a company can hope for is to receive an occasional notification as the container travels through certain choke points (e.g. after arriving at the shipping port). As the following diagram shows, this leaves companies in the dark for the majority of time that goods are in transit: