What doshippers and carriers

think?

Results of the monthly trend survey

for December 2011

© Zsolt Kosinszky

Summary for Dec 2011 (vs Nov 2011)

© Zsolt Kosinszky

Shippers expect Carriers

-5% to +5% volumes up to 5+% increase

40% expect no change transport capacity 46% expect less

no change transport rates up to 5% increase

2.10% rise diesel prices 5.65% rise

up to 5% increase cost for carriers up to 5% increase

Survey methodology and base data

• anonymous survey

• between November 15-20, 2011

• 535 respondents with activities on all

continents

• participants: buyers (shippers) and

sellers (carriers) of transport services

and other supply chain players

(e.g. infrastructure providers,

consultants, media, education)

• about 54% of respondents are high

level decision makers

• base data: November 2011

© Zsolt Kosinszky

40%

26%

34%

0%

10%

20%

30%

40%

50%

shipper carrier other

Participants

72%

46% 42%36%

30%

0%10%20%30%40%50%60%70%80%

Europe The Americas

Asia Africa Australia and

Oceania

Area of activity

75%

39% 41%

0%

20%

40%

60%

80%

shipper carrier other

Decision makers

Featured survey: transport tendering

© Zsolt Kosinszky

Regularity

Shippers: 30% use only spot rates, 25% tender every 2 years

Carriers: 36% tender yearly, 18-18% monthly or quarterly

Tools used

Shippers: 53% use spreadsheets, 37% web based tools

Carriers: 69% use spreadsheets, 23% web based tools

Number of carriers invited on average

Shippers: 8 to spot tenders, 57 to long term tenders

Carriers: 24 to spot tenders, 50 to long term tenders

© Zsolt Kosinszky

Challenge Problem

Find the right carriers (spot and long term)

Rates not competitive, insufficient quality of service, long tendering process, complicated spot sourcing

Operationalefficiency

Processes not in place or not working, long lead times, suboptimal and costly operations, low visibility (information), decreasing service level, high inventory

Capacity management

Insufficient load and manufacturing optimization, backup providers unknown, jammed supply chain

Getting greener while saving

Most solutions are costly/take long time to put in place and/or take effect

Current supply chain challenges

Shippers

55%50%

45% 45%

0%

10%

20%

30%

40%

50%

60%

© Zsolt Kosinszky

Challenge Problem

Operational efficiency Highly manual processes, insufficient visibility, short term actions

Find new customers Huge competition, extremely resource intensive structures

Find the right subcontractors (spot and long term)

Highly resource intensive processes, outdated applications (freight exchange/loadboard)

Capacity management Insufficient network optimization, insufficient visibility, short term view, collaboration issues

Financing/payment Complex rating systems, numerous extra cost types, credit issues, insufficient collaboration

Current supply chain challenges

Carriers

69%

46%38% 38% 38%

0%

10%

20%

30%

40%

50%

60%

70%

80%

Root causes of supply chain problems

• most of the major issues (finding the right carrier, improving operational efficiency, capacity management and finding new customers) are due to insufficient knowledge/choices and information in the supply chain

• getting greener while saving costs is only possible if an instant solution is found

• financing is partly problematic due to credit issues, partly there is an underlying concern: only more equipment is the way forward?

• payment issues need a legal framework

The above issues will be focused on in upcoming surveys and white papers.

© Zsolt Kosinszky

Expected diesel price in Dec 2011

© Zsolt Kosinszky

While shippers (2.10%) believe that the market (2.72%) expects a somewhat lower price than them (2.05%), carriers (5.65%) think that the market (2.72%) expects a significantly lower price than them (3.77%).

The base price is the October 2011 average diesel fuel price per litre in Germany: 1.46 EUR. (source: http://www.theaa.com/onlinenews/allaboutcars/fuel/2011/october2011.pdf)

2.10%

5.65%

1.43%

2.72%

0.00%

1.00%

2.00%

3.00%

4.00%

5.00%

6.00%

shippers carriers others all

What they expect

2.05%

3.77%

1%

2.13%

0.00%

0.50%

1.00%

1.50%

2.00%

2.50%

3.00%

3.50%

4.00%

shippers carriers others all

What they think the market expects

Transport rate changes in Dec 2011

• 58% expect no change

• 20% expect an increase

of up to 2% no change

• both shippers and carriers

believe the market expects

a rate increase of up

to 5%

© Zsolt Kosinszky

1% 1% 4%

20%

58%

8%4% 3% 1%

0%

10%

20%

30%

40%

50%

60%

70%

What shippers expect

61%

28%

55%

71%

25%

50%

0%

10%

20%

30%

40%

50%

60%

70%

80%

rate increase no change rate increase of up to 5%

What shippers and carriers think

the market expects

Changes in carriers’ costs in Dec 2011

• 75% expect higher costs

• 25% expect no change

• 33% expect an increase

of between 5-10%

• both shippers and carriers

foresee a cost increase of

up to 5%

© Zsolt Kosinszky

0%

33%

25%

17%

25%

0% 0% 0% 0%0%

5%

10%

15%

20%

25%

30%

35%What carriers expect

57%

14%

50%

67%

25%

42%

0%

10%

20%

30%

40%

50%

60%

70%

80%

cost increase no change cost increase of up to 5%

What shippers and carriersthink the market expects

Transport capacity in Dec 2011

• while shippers rather

expect no change (40%),

46% of carriers

believe it will be less

than in November 2011

• carriers also believe

the market expects less

capacity (55%), while

shippers are rather

undecided

© Zsolt Kosinszky

25%

40%

35%

23%

31%

46%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

more unchanged less

What shippers and carriers expect

31%

37%

32%

27%

18%

55%

0%

10%

20%

30%

40%

50%

60%

more unchanged less

What shippers and carriersthink the market expects

Volumes in Dec 2011

• both shippers and carriers

are rather positive about

business expectations

• both shippers and carriers

foresee that the market will

grow, although opinions

about no growth or

decreasing business results

are also strong

© Zsolt Kosinszky

40%

20%

25%

46%

8%

30%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

volume increase no change volume increase of up to 5%

What shippers andcarriers expect

37%

32%

22%

46%

15%

38%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

volume increase no change volume increase of up to 5%

What shippers and carriers think

the market expects

Thank you, sharing, next survey, contact

Firstly, if you are one of the 535 respondents who took this survey, thank you for your time!

In case you found this survey useful and/or interesting, please feel free to share it with anyone.

The January 2012 survey questions will be accessible from December 15, 2011.

If you would like to get in touch with me, please write to kosinszky.zsolt@gmail.com or contact me via LinkedIn http://be.linkedin.com/in/zsoltkosinszkyor feel free to join the Collective Transport Sourcing group on LinkedIn:http://www.linkedin.com/groups?about=&gid=4128642

© Zsolt Kosinszky