Forwarding outside the square

What does a freight forwarder do when one of their clients requests a re-negotiation on their existing contract?

The options are to buckle down and put the thinking cap on, or possibly loose a valuable and long-term contract to a competitor.

This was the dilemma facing Paccon Logistics Ltd when existing client Laminex NZ Pty Ltd were looking at the margins that originally consisted of 1600 container movements annually, plus the road freight contract from factory to wharf.

“We’ve had a really good relationship with Laminex but we knew that if we were going to keep this contract, we had to pull out all stops and think creatively about it,” says Ian Robson, managing director, Paccon Logistics Ltd, New Zealand.

The product involved is MDF board, manufactured by Laminex in NZ for shipping to Ballarat and Gympie in Australia.

Since reviewing the contract, and with the help of the revolutionary Tynecat loading/unloading system, Paccon Logistics Ltd has been able to manage on time delivery with virtually no damage and at a reduced cost.

In 31/2 years Paccon Logistics Ltd has reduced the damage rate to 0.0014 per cent while their competitor, Toll NZ, sets their acceptable damage rate at five per cent.

The Tynecat loading/unloading system has also resulted in a reduction of OH&S claims.

In addition, Paccon Logistics Ltd achieved a reduction in the number of shipped containers by reconfiguring the loads and having their road freight contractors invest in lighter vehicles able to handle heavier loads up to the legal road limits in NZ and Australia.

Further costs reductions were gained when Paccon Logistics Ltd introduced webbing and ratchet tie downs in place of the old metal strapping. The webbing costs are around $60 a container over 12 trips as opposed to the single use metals straps costs at approximately $56 a container.

Additional benefits are also made in OH&S and the environment as metals straps can flex when cut and are discarded after a single use.

“In the three years since Paccon introduced the Tynecat loading system to us, this unique piece of equipment has significantly reduced damage to product through both load securement flexibilities and ease of moving product in and out of containers,” says Kerry Kinnane, National Transport Manager, The Laminex Group.

“Another unexpected but most welcome surprise was the minimisation of hazards associated with loading and unloading through a major reduction in the need for human intervention.”

The Laminex Group has just renewed their contract with Paccon Logistics Ltd for another three years.

This is what an open book partnership can achieve.

The result is a win win for both companies, a big win for the insurers, and a small victory for the environment.

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