Which Supply Chain Visibility Technology is Right for You?

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Are your shipments domestic or international?

What modes of transport do you use?

Do you need environmental (temperature, humidity, shock, etc.) data?

What kind of infrastructure do you have in your supply chain end-to-end?

Do you need to be able to see movement within a facility, such as a warehouse?

What is your top goal in gaining visibility?

What are Trade Wars?

Although the old British Empire has been blamed for many of the bad things in this world today, one good thing it was mainly responsible for was international trade on a global scale. Today global trade is part of everyday life with, not just most countries partaking in it, but many now depending on it for their very existence financially. It is for this dependence on international trade which makes trade wars so devastating or at least having the potential to be, so what exactly is a trade war?

When countries agree on trading between one another it is usual for them both to agree on what export and import charges will be made by each other, on each other’s products or materials. This will often afford each country’s goods preferential pricing compared to other countries goods thereby improving each of the countries sales of manufactured goods or raw materials. If there is no agreement between each country then each country can charge whatever taxes they like on the others goods. Although this will usually mean one country’s products will receive the same taxation as any other countries, allowing them equal opportunity to compete, a trade war can potentially start when one country applies extra taxes to another’s alone, making that country’s products more expensive than similar products imported from elsewhere. If a country who has had extra charges levied against their products responds in kind to the country also making extra levies, a trade war begins.

When one country is involved in a trade war with another, it is hard for either country to sell their products in the others and overall trade and businesses in both countries can suffer for this. This is the case with the latest trade war which is taking place between the United States and China. This trade war was started when president Trump placed an additional 25% tax on aluminum imported from China. Although the pretense was to secure metal and aluminum miners jobs in the US, it gravely hurt car manufacturers in the States who are highly dependent on China’s aluminum. In response to this action, China applied extra taxation to items imported from the US and a trade war began.

Once started though, it is difficult to contain a trade war to just the two countries which started it and this has been shown by American car makers having to add the extra cost of aluminum onto the cost of their end product to other countries. This in many cases goes against trade deals already made between those countries and the US and so another potential trade war emerges.

In the end trade wars are bad for most people and the reason for that is that manufacturers and importers will always pass any extra costs onto the retailers and eventually the general public and it is therefore the general public which bears the cost of the war. This knock on effect occurs in any country which is involved in a trade war and so although people may think only governments and businesses are doing battle, all of us are casualties of those battles.

Bill of Lading: Everything You Need to Know

A bill of lading (BOL) is a document which carriers use for shipping freight and whilst it is an essential document for this purpose, many shippers have questions regarding why it must be used for every consignment. Hopefully the following information will answer those questions allowing shippers to be more understanding of its need and hopefully therefore for prepared in meeting a carrier’s requirements.

Basically a BOL is a legally binding document and therefore legitimizes both the carriers’ role in the process of shipping whilst also recognizing the owner of the freight being shipped. The document therefore needs to have a comprehensive list of the consignment being shipped, the carrier’s details and also the full details of the person shipping the freight. As a legal document a BOL can be admissible in court and so can constitute a legal agreement between the shipper and the carrier and as such must be signed by authorized representatives of the shipper and carrier, plus the consignee on delivery.

Although many shippers may have their own documentation which they like completed, those documents do not necessarily have legal status in a court of law and so whilst they can still be completed in order to facilitate a shipper’s personal files it is only an official BOL which carriers will accept as a definite and binding contract.

The BOL is therefore the legal document recognized by all international authorities and can therefore, if necessary, be used as the only consignment documentation. However most shippers prefer to attach to a BOL their own documentation such as an invoice for the consignee but this plays no role in the shipping of the freight or the carrier as it a document concerning the shipper and recipient only.

As the legal document accompanying and freight, it is a BOL which customs and other authorities will ask to see on international shipments or perhaps police in any country. Most carriers will of course cater to the needs of shippers in completing or signing other paperwork but this is not an internationally required procedure as the BOL supersedes and legitimizes any other documentation a shipper may present.

The fact that a carrier must have a BOL does not necessarily mean they have to provide as a shipper may prefer to create and use their own. This is acceptable to all carriers as long as it contains the minimal details to make it legal. This means that most consignments have BOLS provided by either the shipper or a 3PL working on the shipper’s behalf. As a BOL can be created by a shipper, it can contain far more information than the carrier needs but in doing so may make life easier for the shipper as far as management of consignments and maintaining record files is concerned.

Essentially then, any number of documents may accompany any shipment but the only essential one as far as the carrier, customs and other authorities are concerned, is the one which constitutes a legal BOL.

One way to gain clarity into the management of BOLs is through the ODYN Fleet Platform where we digitize, centralize, and analyze any important paperwork in your supply chain. Contact us to learn more about ODYN can help streamline your operations today!

The ELD Mandate: Is it Good or Bad for Business?

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Are you not a happy trucker due to the new ELD mandate sweeping the industry?

If so, you’re not alone. A new satisfaction survey gathered by trucking authority Coretex concludes that most distance truckers struggle with the electronic logging device mandate implemented in late 2017.

Here’s an overview of the mandate and how it benefits both truckers and fleets, as well as how it curbs their flexibility.

The ELD Mandate: What Is It?

On December 16, 2015, the Federal Motor Carrier Safety Administration published a mandate for commercial long-distance vehicles. This new ELD regulation states that commercial vehicles must be fitted with an electronic logging device in order to accurately track a driver’s time on the road.

The mandate is supposed to reinforce the hours of service limit. Currently, drivers can’t log more than 14 consecutive hours of driving.

Under this rule, most affected vehicles had to implement the requirements by December 18, 2017. Certain vehicles were given a two-year extension if they had an automatic onboard recording device installed. Furthermore, vehicles whose engines predate the year 2000 are exempt altogether because their engines can’t link to an AOBRD or an ELD.

What Truckers Fear

Though the new electronic device mandate makes logging less of a hassle and helps drivers stay productive, many are afraid of its implications. ELD’s log everything and cannot be edited. This can cause strain between a trucker and his freight company, for instance.

Also, ELD’s are very expensive to install. While the FMCSA implemented this mandate, the government won’t carry that cost.

The Difference Between ELD’s and AOBRD’s

Both electronic logging devices and automatic onboard recording devices are installed into a commercial vehicle. They both rely on connectivity through the vehicles’ engine. also, they both log the vehicle’s activity, but the similarities end there.

Automatic onboard recorders are much less sophisticated. they don’t display specific logging information; they just give a general overview of the truck’s distance driven. they can also be controlled by the driver and edited.

ELD’s are much more thorough in what they display. These computers can function as shipment tracking devices as well as trucking data logs. they cannot be altered by the driver in any way.

The drivers whose vehicles were exempt due to outdated engines still have to log their data. They can choose to write paper logs or use mobile software via phones and tablets to stand in as ELD’s. The paper logging was largely discredited by the industry. It can be tampered with when fleet managers or drivers are scrambling to complete loads on time or make more money per load.

The Benefits Of ELD For Business

The resistance to the ELD rule is due to unwanted expenses and confusion about the guidelines. Both truckers and freight companies are not sure what the mandate means for them. Once this confusion is clarified, the benefits of the system are obvious:

  • Less time spent on logging data means more time to drive.
  • A universal rule for all commercial vehicles means fewer issues with compliance.
  • Companies can easily track their trucks and provide accurate shipping to their customers.

Aside from the above business benefits, the mandate will achieve it’s main purpose: keeping consecutive driving hours in check. this should contribute to fewer commercial trucking accidents, resulting in a win for companies and truckers alike.

Are You Tracking Your Fleet?

Do you feel more confident about the ELD mandate and how it affects your trucking business? Ultimately, you can benefit from the new ELD regulations and increase the productivity of your fleet. Learn more about fleet tracking and other trucking regulation standards by contacting us or browsing previous blog posts.

Inventory in Transit 101: Everything You Need to Know

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How well are you tracking your shipments? If you have to pause before answering this question, chances are this is an area for improvement.

Inventory in transit can sometimes lead to accounting- and financing-related dilemmas if you don’t effectively track it.

This is why we’ve compiled a comprehensive guide on everything you need to know about inventory in transit and why tracking is a must.

Let’s jump in!

What Exactly Is Inventory in Transit?

Inventory in transit refers to goods that are going from certain companies to other companies — for example, wholesalers to retailers — but that haven’t reached their destinations yet.

These transactions can take a while to occur, particularly if manufacturers are shipping large numbers of items to wholesale suppliers or retailers.

A major question that might crop up when goods are being transferred is at which point the ownership of the goods is transferred from party A to party B.

There are two types of transfers of ownership:

One is called freight on board, or FOB, shipping point. In this situation, party B takes ownership of the items at the place from which they are shipped.

The other type of transfer is called FOB destination. Here, party B takes ownership once it receives the goods at the intended destination.

Accounting Implications

The kind of transfer that takes place has an impact on how your business records that particular transaction.

In the FOB shipping point situation, the transaction can be recorded as a business sale starting from the shipment day.

Meanwhile, in the FOB destination situation, you must wait until the recipient takes ownership of the goods sold at the appointed destination.

This is especially critical to get right if it means that a transaction started in a certain month or year may end up being completed in the following month or year.

Financing Implications

Inventory in transit can also have financing implications.

For instance, let’s say that a buyer tries to use purchased goods as collateral for gaining financing to complete extra business operations.

A lender may decide to issue a loan with the expectation that the appropriate amount of goods will reach the buyer at a certain time. However, the lender must first do its due diligence to make sure that this will actually happen. Otherwise, the buyer may end up defaulting on the loan.

How We Can Help

We offer top-of-the-line shipment tracking software that provides the total end-to-end shipment visibility your company needs. Our goal is to help you to easily track and analyze how your shipments are moving across the globe.

We use a combination of public, private and proprietary datasets to get the job done.

For example, we look at weather data to determine how the environment may impact your business’s supply chain. We also look at warehouse management system data to determine the behavior of your business supply chain’s nodes. And even the performance of carriers in your supply network.

Get in touch with us to find out more about how we can help you to stay on top of your inventory in transit.

Your Complete Guide to Incoterms

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Incoterms sets out rules for selling physical goods that need to be transported.

These rules first cropped up in 1923 but did not become known as Incoterms until the Internation Chamber of Commerce (ICC) published them in 1936. And they have since been revised over the years.

In 1953, 1967, 1976, 1980, 1990, and 2000 they were amended. There was an eighth version– Incoterms 2010 — published on January 1, 2011. A new set of revisions, known as Incoterms 2020, is currently in the works.

What do the Incoterms Rules Focus on?

There are two main aspects to Incoterms rules, which are as follows:

1. Who is responsible for arranging and funding the transport in question?

This essentially asks whether the seller or the buyer should make the arrangements. “Arrangements” includes any loading, unloading, importing and exporting and the insurance of the goods being transported.

2. When does the responsibility shift from the seller to the buyer?

This is very important, in case the goods are lost or damaged mid-transit (which is where tracking is crucial).

The 11 Incoterms Rules

There are 11 rules in the current Incoterms layout.

The first 7 Apply to Any Mode of Transport:

1. EXW Ex Works

The individual selling the goods must deliver them to the buyer. The goods in question are then at the buyer’s disposal. Arrangements here must be made between the two parties. The place at which the goods are delivered is to be arranged between the two parties. eg: At the premises of the seller or another location agreed by both.

2. FCA Free Carrier

The seller delivers the goods to the carrier or another person nominated by the buyer at the seller’s premises or another named place.

3. CPT Carriage Paid To

The seller delivers the goods to the carrier or another person nominated by the seller at an agreed place and that the seller must contract for and pay the costs of carriage necessary to bring the goods to the named place of destination.

4. CIP Carriage And Insurance Paid To

The seller delivers the goods to the carrier or another person nominated by the seller at an agreed place and that the seller must contract for and pay the costs of carriage necessary to bring the goods to the named place of destination.

It is also up to the party doing the selling to arrange the appropriate insurance.

5. DAT Delivered At Terminal

The seller must deliver the items, take them from the method of haulage and leave them under the entrustment of the buyer. And this must be at a location disclosed by the buyer and agreed by both.

6. DAP Delivered At Place

The seller must deliver the items, take them from the method of haulage and leave them under the entrustment of the buyer. And this must be at a location disclosed by the buyer and agreed by both. The seller is responsible in the delivery and movement of the goods.

7. DDP Delivered Duty Paid

The seller delivers the goods when the goods are placed at the disposal of the buyer, cleared for import on the arriving means of transport ready for unloading at the named place of destination. The seller is responsible for the financial and potentially troublesome issues involved in delivering items to the agreed-upon location.

They are also responsible for ensuring the items are legally signed off for haulage and to cover any costs or any customs procedures that may apply to the transportation of the items.

The Final 4 Apply to Sea and Waterway Transportation:

8. FAS Free Alongside Ship

The seller is entrusted with delivering items at the ship requested by the purchaser at the shipment location. Loss or damage to the items is the responsibility of the buyer when the transaction is completed.

9. FOB Free On Board

The seller is entrusted with delivering items at the ship requested by the purchaser at the shipment location. Loss or damage to the items is the responsibility of the buyer when the transaction is completed. In this case, the transaction will see the goods put on board the vessel.

10. CFR Cost and Freight

The seller ensures the items are placed on board the ship; or procures the items that have been offloaded already. Loss or damage to the items is the responsibility of the buyer when the transaction is completed. In this case, the transaction will see the goods put on board the vessel. All freight costs are the responsibility of the buyer.

11. CIF Cost, Insurance and Freight

The seller ensures the items are placed on board the ship; or procures the items that have been offloaded already. Loss or damage to the items is the responsibility of the buyer when the transaction is completed.

In this case, the transaction will see the goods put on board the vessel. All freight costs are the responsibility of the buyer. The seller is also responsible for insurance.

Incoterms Rules Round Up

Incoterms rules were devised initially to promote the use of containerized goods, but today they are used for practically all cross-border transit.

A major example of why these rules were put into play in the first place was the Japanese tsunami of 2011 when many exporters suffered losses which could have been avoided. Their containers were destroyed whilst in the container terminal.

Also of note is that Incoterms rules do not cover all aspects of a commercial agreement and these are to be arranged independently.

If you are looking for help optimizing your in-transit inventory (or just making sure that your shipments are doing what they’re supposed to be doing), then get in touch for more information.