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Purch-lympics Entry #3 - Round #3
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Daniel Haakuria
Materials Manager - Supply Chain, Windhoek, Namibia
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"The Logistics division (Supply Chain) was tasked to have the next batch of tires delivered expeditiously as the operation was facing bleak production delays. The lead time for the heavy mobile equipment off-road tires is a minimum of 120 days.
The shipping route is Perth, Australia, Cape Town, South Africa and then transshipped on a feeder vessel to Walvis Bay harbor, Namibia and finally road freighted from Walvis Bay to Rosh Pinah, Namibia. The distance from Walvis Bay to Rosh Pinah via road is 1,300km.
To shorten the delivery period and hasten the availability of the consignment, we opted to contact the shipping line in Cape Town and effect a COD (change of destination) by re-routing the consignment direct to another port, Luderitz, which is 280km from Rosh Pinah where the operation is based. Here we had to deal with 5 parties (the shipping line in Cape Town, the port authorities in Walvis Bay and Luderitz, the cartaging agent via road, the contracted road haulier from Luderiz and the operations Mining Department). The COD would cost US$100. We paid the penalty of US$100 to the shipping line, re-routed the containers to Luderitz and uplifted the consignment onto our dedicated haulier which returns empty on the return leg from Luderitz after having delivered the zinc to the harbor for export to Europe.
In conclusion, we reduced the transit time by 4 days in total, paid a penalty of US$100 to the shipping line to change the COD, curtailed the possible production losses to Mining but saved a massive US$6,036 ([N$47,000] where 1 US$ = N$7.786) which is the road freight leg from Walvis Bay harbor to the southern mining town of Rosh Pinah. The consignment was duly delivered and accepted for issuing to Mining in record time.
Lessons learned: a good understanding of shipping schedules and nascent negotiation skills and taking advantage of opportunities when these becomes available, and not being "penny-wise pound foolish" (incurring a penalty of US$100 but saving US$6,036 in the process)."
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