Shipping lines can save money by sharing or pooling containers, reducing the need for empty container repositioning, according to a logistics specialist.
Lalith Edirisinghe, head of the Department of Logistics and Transport at Sri Lanka’s CINEC Maritime Campus, is working on a ‘virtual container inventory’ (VCI) system, which he argues is similar to existing mechanisms for sharing shipping space or slot exchanges. His model enables the exchange of boxes between lines with an excess and those with a shortage.
“Other solutions try to reduce repositioning cost. This approach tries to reduce the need for empty container repositioning, if you cannot eliminate it.”
In Edirisinghe’s system, carriers would exchange containers on mutually agreed terms but continue to control their own inventories.
“As pooling is done virtually, physical storage of containers is not a cost,” he explained, presenting his model at the Colombo International Maritime Conference on 26 September. “On the other hand,” he added, “VCI expands inventory of carriers beyond their existing individual capacity.”
Empty container repositioning in Sri Lanka, which imports more than it exports, costs about USD100 million annually, “which is finally paid by consumers”, Edirisinghe noted.
This post was sourced from IHS Maritime 360: View the original article here.