The importance of moving empty containers is simple:
"It's a huge expense, a huge headache for the industry," says Neil Davidson of London-based Drewry Shipping Consultants. The net cost of moving empties is around $7 billion a year, say analysts.
The foldable container would reduce the cost of shipping the empties. However, these foldable containers cost around $4,000, or twice the cost of the standard containers. And, the
Right now, the industry is not standing still. IBM's ILOG Optimization solutions are being used to optimize the return of the empty containers. The goal of the optimization is to get empty containers to where they are needed at the lowest cost. Of course, the containers do not have to return from where they started and there are options for leasing or buying new containers.
The problem can be difficult when you start to consider such things as the different container types, the capacities of ships, the costs of different modes of transportation, and the long ocean shipping times.
Besides reducing costs, the shipping companies using this
Finally, IBM's commitment to Analytics and Smarter Planet, provides additional benefits to this problem: First, since there is variability in demand and supply, it is important to correctly set the safety stock levels for empty containers at key locations. Second, it is important to track and trace the containers so you have better visibility but also to know when a container needs to be replaced or repaired.