Post-Covid challenges
Post-Covid challenges facing the transport and freight industries Credit: Tom Fisk on Pexels Logistics firms must adjust to more frequent and more intense disruptions, warns Elesh Bisla, CEO of GENRIC Marine Underwriting Managers. Economic slowdown and slow recovery in the midst of the pandemic are major challenges facing the transport and logistics industry. Coupled with trade tensions and political upheaval, these factors are exacerbating the supply-chain risks facing the transportation and logistics industry. One of the key lessons learned from the Covid-19 experience is the massive interdependence of the supply chain and that disruptions are becoming more severe and occurring with greater frequency. In such an environment, the freight-forwarding sector is under tremendous pressure in terms of costs and achieving operational efficiencies, while also having to balance the risks faced in safeguarding valuable and high-risk cargoes through marine insurance solutions. Elesh Bisla, CEO of GENRIC Marine Underwriting Managers, says that while marine insurance products are conventional in nature, each policy must be customised to meet the unique needs and risk exposures of every client, every cargo and every operating environment – from simple and straightforward, through to complex and highvalue. Here, the roles of experienced marine insurance brokers and underwriters are crucial. “In an increasingly litigious environment, as well as escalating crime and weather catastrophes, it is crucial that all role-players in the supply chain fully understand the nature of freight being transported, its value, including all duties and taxes, the transportation risks whether by sea, air, rail or road, who is liable, and what exactly is covered at every point of the supply chain journey. The brokers, underwriters, adjusters, surveyors and claims handlers play a crucial role in this supply chain, and their skills and experience are increasingly in demand,” explains Elesh. Escalating overhead costs and skimping on insurance “Freight forwarding and cargo handling is a highly-competitive industry and price plays a big role. With escalating costs from fuel 50 | www.opportunityonline.co.za
LOGISTICS Elesh Bisla _________________ Elesh Bisla, CEO of GENRIC Marine Underwriting Managers, says that the freight-forwarding sector is under tremendous pressure ________________ to taxes, duties and security, there is always the temptation to cut costs and corners, including on the insurance side – often with disastrous consequences if and when things do go wrong. We’re seeing an increasing trend of freight operators taking the bare minimum of cover, exposing themselves to massive liabilities both in terms of their balance sheet and reputation. In some instances, freight forwarders are so eager to sign up new business that they do not fully interrogate the real value, risks and liability associated with the cargo they are taking on. This is where the advice and guidance of a professional marine broker is crucial in advising their clients of the inherent risks, and how and why scoping their marine cover correctly is crucial to their business sustainability,” says Elesh. Consider the implications of a logistics company that only has R500 000 damaged goods cover, but the cargo load being transported is worth R4-million. If that vehicle is involved in an accident and the load is an outright loss, the implications of a R3.5-million shortfall in cover could put the forwarder out of business permanently and liable for the damages. Escalating crime and training Escalating crime and syndicates pose another significant risk, with high-risk cargoes such as electronics, cellphones, sim cards, alcohol and cigarettes falling prey to hijackers and looters. Freight handling and loading is another important risk that requires training to ensure that drivers and transport operators know how to load and offload cargo correctly, as well as the correct storage and handling conditions of such goods – for example perishables and flammable items. In such instances, it’s important to understand whether your insurance coverage applies once cargo is offloaded and ownership or possession is transferred to another party. The consequences of skimping on insurance “It’s crucial to fully interrogate the value and nature of the goods being transported, and in turn ensure that your marine insurance limits and conditions of cover are correctly scoped. As the effects of the pandemic continue to be felt in terms of a decline in trade volumes, it means that all service providers in the supply chain are chasing a smaller pool of ships and cargo. Bespoke solutions to solve unique problems with Ctrack SMILE Ctrack, South Africa’s leading fleet management and asset monitoring solutions provider, is continuously innovating to provide its customers with the latest solutions in an ever-changing environment. With over 35 years’ experience, Ctrack continues to seek out cutting-edge solutions to provide information and insight on a wide variety of moveable and non-powered assets while providing real-time monitoring. Ctrack considers five key focus areas of asset management, namely Safety and Security (Risk Management), Driving Behaviour (Cost Management), Productivity and Efficiency, Operations Control and Compliance and Asset Management. Enhancements to safety and security of mining operations include the use of Ctrack’s unique script capabilities called SMILE. Operators can create bespoke efficiency and risk outputs that create endless opportunities to measure and solve an operator’s critical KPIs. Through SMILE, managers set up specific rules based on their needs. These could be custom-geo zones with unique triggers such as doors or switches, load limits, safe-stop areas and a myriad of other customisable parameters that address unique challenges. These actions reduce wear and tear on the vehicle, reduce warranty claims and improve risk management by offering vastly greater visibility and control. Ctrack has industry solutions to track a variety of assets including cars, trucks, trailers, containers, generators, dump trucks, front-end loaders, graders, bulldozers, water bowsers, light- and heavy-duty vehicles, which is why Ctrack is a one-stop shop for all your mining, yellow metal and asset management needs.
