When the shipping market was growing at a rate of knots, watching your costs might not have been a priority.
Today, driving down costs is essential – and that’s one thing ShipServ does exceedingly well. In fact:
If you manage 20 ships, ShipServ can save you anywhere from $600,000 to $2,400,000 every year.
Here’s how:
- The average ship spends $600,000 per year on operational supplies.
- So 20 ships spend $12,000,000 per year.
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If ShipServ can help you save just 5%, that equals $600,000.
(This is far below the savings our users and members report).
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If we can help you save 20%, that equals $2,400,000 each year.
(And we often do even better than that!)
The savings come from our two services:
ShipServ TradeNet and ShipServ Pages
Let's look at TradeNet savings first:
Direct savings from using TradeNet
TradeNet generates direct, measureable savings from:
- Reduced administrative overheads
One member reported processing 53% more orders without adding any staff. - Faster ordering cycles
Our members always report improvements over 20%. One told us their req-to-order-cycle went from 11 to 6 days, a 45% saving. That’s not unusual. - Better intelligence, decision-making and negotiations
Purchasers tell us they easily shave 5-10% off unit costs (depending on the category) through TradeNet-empowered negotiations alone. Plus the Supplier Relationship Management benefits.
Indirect savings from TradeNet
These are harder to measure but our members and users tell us they’re indisputable sources of real savings:
- Fewer off-hire days
Purchasing errors can lead to downtime and that’s expensive ($100k per day or more) - Minimal dry dock over-runs
Same idea: fail to get the right supplies delivered and your ships are out of use and that’s EXPENSIVE. - Fewer lost contracts
Just one contract lost due to an unavailable ship could cost $50,000 in profit. - Fewer hand carries
Another expensive waste that better, more efficient purchasing can and does avoid. - More consolidated orders
So you save on shipments and by aggregating prices. - Lower expediting costs
Fewer rush orders means lower logistics spend.
And we’re not even counting any of these indirect savings in our calculations!
This time with Pages:
ShipServ Pages, the maritime search engine, drives down costs at the supplier sourcing stage – especially for the most time-consuming sourcing challenges such as:
- Looking for more competitive suppliers
- Sourcing parts for old or obsolete equipment
- Finding suppliers in unfamiliar ports
- Sourcing equipment repair services
In all these case (and many others) finding suppliers fast doesn’t just save you time, it saves you money.
- Buyers have told us they saved up to 40% on contracts with new suppliers found through Pages. Regular savings of 10-25% are routine.
- Some suppliers offer an added 3% discount for orders sourced through Pages.
The principle is understood by every purchasing professional: the more you can multi-bid, the better prices you get.
The bottom line.
Taken together, TradeNet and Pages drive down your costs and increase your profit margins.
We’re being extremely conservative when we talk about an overall 5% savings – and that still adds up to $600,000 saved every year for every 20 ships you manage.
With savings closer to 20% savings - still very realistic – you’re saving $2,400,000 for every 20 ships.
Add a few off-hire days that you avoided.
Add the fully-loaded costs of an extra purchaser or two.
Add the contract you managed to save.
Add the process improvements and keener contracts.
Add the time you save by not having to read ShipServ marketing any more!
(Hours a month if we’re doing our job).
If you’re not using ShipServ, you’re letting real money drip away every time you buy operational supplies.
The sooner you start, the sooner the savings start.