A global chemicals company overcomes the Red Sea disruption with Maersk’s multicarrier intermodal solution.
Global disruptions can make supply chains vulnerable
When there’s an entire world of oceans to move global trade, the closure of a 30km strait might not seem that huge of a concern. However, when the Bab-el-Mandeb was shut due to geopolitical tensions in the Red Sea region, global trade routes were disrupted leading to shipping lines rerouting vessels around the Cape of Good Hope significantly impacting shipping schedules and operations. So, what happened to businesses that primarily relied on the Red Sea route? Such is the story of our key customer, who found themselves in the throes of this major disruption.
Identifying when it’s time to pivot
Our client is a global chemicals company operating in petrochemicals, fertilisers, and specialty chemicals, with a strong presence in the Americas, Europe, Middle East, and Asia Pacific. Their reliance on the Red Sea route for a sizeable portion of their exports was affected due to the uncertainty in shipping schedules leading to:
- Delayed deliveries of about three weeks leading to loading and transportation delays.
- Disruptions in inventory management, export volume planning, and lifting.
- Lack of visibility into the full supply chain affecting tracking and managing shipments.
- Increased transportation costs due to rerouting and potential bottlenecks.
With export volumes only 50% of the target, as the year-end approached, the situation was further exacerbated by rising freight rates. The potential loss of revenue from the remaining 50% of impacted volumes posed a substantial threat to the customer's profitability. This was the time to pivot and find a new direction to keep their journey going.
Overcoming disruptions with a ready-to-say yes approach
It was critical for our customer to find an alternative way to make their exports reach the right destination. And we were ready to help them achieve this with our always-say-yes approach. In order to turn things around, we worked together to find an effective solution with our integrated logistics capabilities. We focused on:
Proactive communication
Alternative route development
Supply chain optimisation
As partners to our key customer, our priority was to ensure minimal disruption to their supply chain despite the unexpected challenges in the Red Sea. By collaborating closely and leveraging Maersk’s global capabilities, we were able to quickly implement alternative solutions and maintain the flow of their critical exports. Our proactive approach and commitment to operational excellence helped safeguard their business during a crucial time.
Removing every roadblock from achieving year-end targets
With this partnership and our ready-to-say yes approach for every challenge, our customer was able to optimise their overall supply chain and navigate the challenges posed by the Red Sea disruption. They experienced streamlined operations and reduced workload, enabling them to focus on their core business while maintaining business continuity. We offered:
These solutions prevented our customer from losing out on 50% of their forecasted sales volume during the crisis. As a result, they could demand more from their supply chain even in the face of unforeseen challenges, maintain a competitive advantage in the market, and achieve their year-end targets.
It’s a YES to transforming your petrochemical supply chain
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Nick Glenville
Lead Logistics Product Manager SAA
nick.glenville@lns.maersk.com
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