Though the World Container Index has dipped slightly in recent weeks, it’s important to note the large-scale growth the WCI has seen in recent years. According to Drewry, on May 12th, 2022, “The composite index decreased by 0.9% […] but remained 33.7% higher than a year ago.”
With demand growing despite continued supply chain uncertainties, it’s more vital than ever for a business’s ocean contracts to reflect the complex realities of contemporary logistics. As the effects of COVID-19 continue to obstruct the global supply chain, it’s time to re-evaluate the way ocean contracts are written, managed, and fulfilled.
In a post-COVID global shipping economy, the traditional expectations around volume and timeline are proven nearly impossible to meet, resulting in a greater number of broken contracts and disrupted logistics than ever before.
By embracing a more modern contracting model, both parties can ensure they keep their obligations to their customers and their bottom line.
In a fully globalized economy, it’s almost inevitable that a given ocean contract will involve a number of different parties from around the globe. While this cultural diversity is essential to the global shipping ecosystem, it can also be a source of potential misunderstanding when dealing with ocean contracts.
By utilizing a third-party contracting technology, both sides of an ocean contract can rest easy knowing that their interests have been accurately conveyed and that they have a full, nuanced grasp of their contractual obligations.
Although recent dynamic pricing innovations have allowed for a greater degree of flexibility within the ocean freight industry, they’ve also introduced a degree of instability to businesses.
Stronger contracts, overseen by contract performance technology, can mitigate the uncertainty of dynamic pricing structures while still maintaining the vital flexibility of the present-day ocean contract. By limiting the extent to which the specific figures within an ocean contract can fluctuate, dynamic contracts can provide the best of both worlds.
There are times when contract failure is inevitable. Hurricanes form, engines break down, and crew shortages occur. In other words, things happen. When ocean freight contracts are breached, the next, and most frightening question, is ‘what now?’
With contract performance software, no business needs to fear ‘what now?’
The six points below show how modern contract management technology can take the uncertainty out of an ocean contract.
Today’s global economy is more connected, and by working alongside a contract performance company, equipped with the latest in supply chain technology, logistics companies can ensure that they’re ready for anything.
Request a demo with NYSHEX today – one of the fastest-growing companies in contract performance technology – to find out how our contracting software can work for your company.