Reliability is crucial to The Andersons, Inc., a top-five agricultural exporter. First and foremost, they highly value the satisfaction of their customers, and secondly, if the cargo doesn’t ship on time, they pay penalties to their customers to make it right. The Andersons can’t maintain the trust of their clients, nor their market-leader position if they can’t consistently obtain container equipment and get their cargo on a vessel.
To complicate matters further, freight rates can significantly change for agricultural commodities from one month to the next. Those freight swings are often more volatile than pricing fluctuations for the commodities themselves and can make or break a deal from the get-go. Agri commodities have thin margins and, not knowing the cost of ocean freight makes it very difficult for The Andersons’ energetic traders to close future deals with certainty they’re contributing to the P&L.
The Andersons’ vision is to “grow enduring relationships through extraordinary service, a deep knowledge of the market and a knack for finding new ways to add value.” It is no surprise that they quickly found a way to utilize NYSHEX to do just that!
Contracting on NYSHEX ensured that The Andersons got space and equipment, no matter what. With that out of the way, they could move on to the next procurement objective – making the most out of market opportunities and increasing margin.
The Andersons tapped into their remarkably healthy carrier relationships to find strategic pieces of business to lock in on NYSHEX for a win-win. They routinely propose innovative solutions to their carrier partners such as mid-term programs for evacuating equipment to the places the carriers want it or utilizing a new alternate routing which helps a carrier achieve their goals. This partnership mentality combined with committed volume from The Andersons gives their carrier partners increased confidence to commit to competitive and fixed all-inclusive rates with longer validities.
Another benefit which The Andersons derived from locking in a portion of their overall annual volume on NYSHEX is their hedge against market volatility. They sleep well at night knowing they have guaranteed space they can use to prioritize their most important shipments and at a known, fixed price.
“Using NYSHEX has helped us mitigate our risk and many of the problems we experienced on direct contracts such as rolls, delays or getting a booking when we needed it. It’s given us more confidence in our carriers and allowed us to grow our volumes with them.”- April Zobel, Logistics and Export Manager
NYSHEX has become a proven complement to The Andersons’ service contracts. In fact, after mere months on the Exchange, they became one of our top trading members and a vocal advocate in the industry, willing to tell anyone just how enforceable contracts enhance carrier-shipper relationships.