Why Smaller can be Better

As experts in the shipping industry, we are acutely aware of the trends which affect both our clients and our business. We’ve certainly noticed in recent times, a swing towards using smaller, more focussed shipping companies and away from the larger ‘names’ – and we asked ourselves why this was.

A few years ago, as the recession started to bite, it seemed that everyone was trying to save on cost, which was understandable. It would seem that in some cases, this was at the expense of two key elements though; the speed of transit and level of service. In some cases, we’ve heard that opting for lower-cost options ended up costing clients’ more in the long run. With the economy now picking up, quality of service is once more top of the list of considerations, which is often where the smaller company can excel.

Obviously, being a smaller company ourselves, T Ward Shipping prides itself on offering bespoke shipping services and in fact, we also aim to go over and above what you might expect from a bigger company, just because we can!

We think that customers are starting to see the advantages of the small company approach; smaller businesses might not have the buying power of a larger firm but when we do win your business we are always appreciative; it’s a competitive market. As a result, it’s possible that smaller shipping companies try that little bit harder to hold on to their valued customers, by  offering an above average customer experience.

In a way, it’s easier for smaller firms to do this, as the sheer volume of clientele isn’t there in the same way it could be for a multi-national firm. Instead of having to farm calls out to a call centre or a customer service department, when you speak to a smaller company they probably only have a few people dealing with the calls on a regular basis, which gives you a chance to build up a relationship and not have to go over everything again each time you speak to a new ‘customer services adviser’.

It also means that if something does go wrong, a smaller company is more invested in making sure that it gets put right quickly. A larger company might have a whole list of complaints and issues to deal with – with a smaller firm the focus is on keeping the client happy and retaining business. Reputation is a major issue for small firms, who don’t have the budget for large marketing campaigns so rely on word of mouth and reputation for their business.

It’s almost like having a transport department of your own!

One major advantage we also identified for smaller shipping companies is that they have the freedom to offer a variety of services instead of being restricted just to their own. This opens up a wider choice for customers and gives them much more flexibility to accommodate specific requirements.

It seems that using smaller forwarder takes away all the hassle of transporting and shipping your items. Smaller firms such as T Ward Shipping can offer a tailored service, tailored to your requirements and all with a personal touch!

The shipping industry inspires imagination!

We can certainly tell a tale or two here at t.ward shipping, but although we have always thought that the shipping industry is fascinating, it’s not the sort of industry that we imagined being a setting for a suspense novel! All that has changed since we found out about the latest novel by Matthew McCleery, though.

Matthew, who knows his subject extremely well as he is also president of Marine Money International, which publishes Marine Money magazine and other ship finance publications, has written the exciting sounding Viking Raid: A Robert Fairchild Novel. The book tells the tale of ex-hedge fund manager Robert Fairchild and a Norwegian shipping tycoon as they attempt a $500 million initial public offering "but end up wedged between an American shale gas wildcatter and the energy-hungry People's Republic of China."

If that – ahem – floats your boat, then you’ll also be pleased to hear that Viking Raid isn’t McCleery’s first shipping industry themed novel. His first foray into the world of shipping fiction was called ‘The Shipping Man’ and this story explored the complex and potentially problematic connections between Wall Street and the maritime world. It did well; Forbes gave the book a good review and it garnered praise from some influential shipping industry executives. Both books are available through Amazon.

Matthew McCleery isn’t the only fiction writer who has gained inspiration from the world of shipping, either. Back in 2012, CNBC.com Managing Editor Allen R. Wastler, who covered the maritime industry for The Journal of Commerce for many years, self-published a novel called “Cargo Kills.”

The novel, which is available for download on Amazon.com sounds intriguing, that’s for sure; "Dark docks, gritty shipyards, diesel-stained trains and trucks ... cargo is a dirty business ... and a deadly business. When ocean liners mysteriously sink and a dead body floats up under a cargo pier, a young reporter finds the story of his life. Problem is, can he keep his life long enough to tell it?"

Perhaps we’re looking at a completely new genre here? You read it here first…

Clean Energy for Scotland

There’s more good news for Scotland and its renewable energy sector; it’s recently been reported that a tidal energy scheme in the Pentland Firth has the potential to provide enough power to cover almost half of Scotland's electricity needs.

Engineers from Cambridge and Oxford universities have discovered that the firth, between Orkney and the Scottish mainland, has some of the UK’s fastest tidal currents, and estimate that if turbines were placed in the water there it could generate up to 1.9GW (gigawatts) of clean energy; equal to 43 per cent of Scotland’s average electricity consumption needs.

Turbines would need to be located across the entire width of the channel to fully exploit it, something that we at t ward shipping are glad to hear, as our work with the wind turbine industry puts us in the ideal position to be able to get involved with exciting offshore projects like this.

The team who conducted the study have already identified some of the best locations for the turbines, both in terms of their energy producing potential and their impact on the environment – so the project is looking very promising.

Prof Alistair Borthwick from the University of Edinburgh, said that the recent research built on earlier studies, and had analysed interactions between turbines and the tides more closely to come up with the figures. He explained;

"This is a more accurate approach than was used in the early days of tidal stream power assessment, and should be useful in calculating how much power might realistically be recoverable from the Pentland Firth."

The news was welcomed by WWF Scotland, who said that the sooner wind turbines could be deployed, the greater chance Scotland would have to become a world leader in developing the kind of technology needed to turn tidal power into clean, green electricity.

The project will be the first commercial deployment of tidal turbines in Scottish waters. MeyGen, who were given permission to develop the project in September last year,  said the phased project could generate enough electricity to power the equivalent of 42,000 homes, and that a second phase could see up to 400 submerged turbines at the site.

Watch this space for more updates on this interesting project; we’ll be taking a great interest in it ourselves.

Clean Energy for Scotland

There’s more good news for Scotland and its renewable energy sector; it’s recently been reported that a tidal energy scheme in the Pentland Firth has the potential to provide enough power to cover almost half of Scotland's electricity needs.

Engineers from Cambridge and Oxford universities have discovered that the firth, between Orkney and the Scottish mainland, has some of the UK’s fastest tidal currents, and estimate that if turbines were placed in the water there it could generate up to 1.9GW (gigawatts) of clean energy; equal to 43 per cent of Scotland’s average electricity consumption needs.

Turbines would need to be located across the entire width of the channel to fully exploit it, something that we at t ward shipping are glad to hear, as our work with the wind turbine industry puts us in the ideal position to be able to get involved with exciting offshore projects like this.

The team who conducted the study have already identified some of the best locations for the turbines, both in terms of their energy producing potential and their impact on the environment â€" so the project is looking very promising.

Prof Alistair Borthwick from the University of Edinburgh, said that the recent research built on earlier studies, and had analysed interactions between turbines and the tides more closely to come up with the figures. He explained;

"This is a more accurate approach than was used in the early days of tidal stream power assessment, and should be useful in calculating how much power might realistically be recoverable from the Pentland Firth."

The news was welcomed by WWF Scotland, who said that the sooner wind turbines could be deployed, the greater chance Scotland would have to become a world leader in developing the kind of technology needed to turn tidal power into clean, green electricity.

The project will be the first commercial deployment of tidal turbines in Scottish waters. MeyGen, who were given permission to develop the project in September last year, said the phased project could generate enough electricity to power the equivalent of 42,000 homes, and that a second phase could see up to 400 submerged turbines at the site.

Watch this space for more updates on this interesting project; we’ll be taking a great interest in it ourselves.

Why Smaller can be Better

As experts in the shipping industry, we are acutely aware of the trends which affect both our clients and our business. We’ve certainly noticed in recent times, a swing towards using smaller, more focussed shipping companies and away from the larger ‘names’ â€" and we asked ourselves why this was.

A few years ago, as the recession started to bite, it seemed that everyone was trying to save on cost, which was understandable. It would seem that in some cases, this was at the expense of two key elements though; the speed of transit and level of service. In some cases, we’ve heard that opting for lower-cost options ended up costing clients’ more in the long run. With the economy now picking up, quality of service is once more top of the list of considerations, which is often where the smaller company can excel.

Obviously, being a smaller company ourselves, T Ward Shipping prides itself on offering bespoke shipping services and in fact, we also aim to go over and above what you might expect from a bigger company, just because we can!
We think that customers are starting to see the advantages of the small company approach; smaller businesses might not have the buying power of a larger firm but when we do win your business we are always appreciative; it’s a competitive market. As a result, it’s possible that smaller shipping companies try that little bit harder to hold on to their valued customers, by offering an above average customer experience.

In a way, it’s easier for smaller firms to do this, as the sheer volume of clientele isn’t there in the same way it could be for a multi-national firm. Instead of having to farm calls out to a call centre or a customer service department, when you speak to a smaller company they probably only have a few people dealing with the calls on a regular basis, which gives you a chance to build up a relationship and not have to go over everything again each time you speak to a new ‘customer services adviser’.

It also means that if something does go wrong, a smaller company is more invested in making sure that it gets put right quickly. A larger company might have a whole list of complaints and issues to deal with â€" with a smaller firm the focus is on keeping the client happy and retaining business. Reputation is a major issue for small firms, who don’t have the budget for large marketing campaigns so rely on word of mouth and reputation for their business.
It’s almost like having a transport department of your own!

One major advantage we also identified for smaller shipping companies is that they have the freedom to offer a variety of services instead of being restricted just to their own. This opens up a wider choice for customers and gives them much more flexibility to accommodate specific requirements.

It seems that using smaller forwarder takes away all the hassle of transporting and shipping your items. Smaller firms such as T Ward Shipping can offer a tailored service, tailored to your requirements and all with a personal touch!

Confidence in Shipping Industry at a six year high

The Moore Stephens Shipping Confidence Survey report is certainly encouraging; the results showed that confidence in the industry rose to the highest level in six years. There was more good news for freight; rates are set to improve or at the very least maintain their existing levels over the year, and an increase in private equity funding is very likely to have a significant impact.

On a scale of one to 10, respondents to the survey reported that their confidence in the markets in which they operate averaged 6.5 in February 2014, the highest score since 2008 when the survey was first launched.

Probably due to this increased confidence, respondents also reported that they were just as likely to make a major investment in their business or a significant development over the next year as in the previous year. Other issues that had an impact included tonnage supply, operating and supplanted fuel costs –no surprises there!

There was more good news from the freight sector with a higher level of optimism about rate increases reported in the dry bulk and container ship sectors.  In the dry bulk sector there was a two per cent increase in the overall numbers of those anticipating rate increases - the highest figure recorded since the survey was started.

34 per cent of respondents from the container ship market think that rates will increase over the next year, more than last year.

The conclusions of the survey are mostly encouraging for shipping companies.  Although it might be a little too early to talk about the downward cycle of recent years being over, it does look as though things are beginning to improve, and the next 12 to 18 months are looking optimistic.

The future of the freight markets is looking brighter than it has done for some years, partly due to worries about over-tonnaging being allayed by increased scrapping and a practical approach to expanding businesses.

In the world of shipping finance, there has been and continues to be a significant level of interest and investment from the private equity sector, which replaces the more traditional bank finance which has been harder to source in recent years. Although some respondents were pleased about this, others did feel that it could depress rates in the long run, potentially delaying recovery, or in some cases enabling people to put expansion plans into place without thinking them through.

One respondent said, “The over-supply of tonnage, together with private equity investment, will continue to depress rates and delay recovery.” Another noted, “The flood of private equity funding, which must be spent before it reaches its sell-by date, persuades previously sensible operators to ignore basic economic principles. It’s happened before.”

The cost of impending regulation didn’t seem to impact on the respondents too much – maybe because the cost of complying with legislation like the Ballast Water Management (BWM) Convention and the proposed new regulations governing emissions control aren’t yet quantifiable.

One leading ship owner has recently estimated that the industry as a whole will have to find US$80 billion to achieve BWM compliance – so it will be interesting to see whether respondents are feeling so positive in the next survey.

Exciting times ahead for the shipping industry

The shipping market is as always erratic and uncertain* and in the changing times of power generation the UK coastal ports are needing to think. On the East coast especially, the offshore wind turbine market is emerging and as the necessity to find suitable port facilities to handle the capacity of large vessels and land which this industry requires there is even more thinking going on. Cockenzie (the old coal fired power station) is being looked at as a new facility as an alternative to established ports which lack sufficient capacity to cope with the new vessels which are employed in the manufacture and shipping for the offshore wind farms.

New facilities are being sought and the Humber is an example of where new ports can and are being developed – Cockenzie has the promise of a nascent port for the new industry as well as present oil and gas business and the future of offshore rig and platform decommissioning. It can be developed to ‘go out’ into deeper water to gain the capacity that these emerging trades require. The land where the power station and coal storage area used to be can take some of the manufacturing space to build some of the blades, tower, nacelles, castings and gearboxes that are land hungry. Other options at other potential ports and sites are being considered.

Many thousands of turbines will be built and many hundreds of offshore platforms will be decommissioned over the next 5 to 20 years and the size of the component parts simply mean that ‘nothing’ can move by road. Some of these parts can be manufactured and handled in existing ports but the assembly of the structures need very large facilities to cope. One can look across the Forth from Edinburgh to Methil and see the size of the Samsung turbine, this is in shallow water and they will get larger as the industry develops, we are going deeper and bigger – it is the new oil and gas industry starting all over again. The picture is quite similar, offshore structures producing oil and gas with a pipeline running to the shore as opposed to wind turbines producing electricity with a cable running to the shore.

These are fascinating and exciting times for shipping companies. The evolution of alternative energy is upon us and will change what we know, just as the shale gas industry is turning the US energy market upside down with compounding affects of that knowledge across the globe. The cost of all this generation of power is always part of the discussion, but all energy supply is fiscally adjusted as we are becoming to learn so clearly. Put that into the context of Shale, Nuclear and Wind (and other energy sources) and it gets your spreadsheets combusting.

As a US economist said when asked – ‘How big is shale gas?’ he replied ’About as big as the world wide web.’ Oh if I was only 30 years younger – what fabulous opportunities and what fun!

There is something that is certain* in the shipping industry and that is change. My company, t. ward shipping ltd  have always relished it and being quick on our toes we are reacting.