Download pdf - Customer Presentation - Introduction DHL OCEAN SECURE

DHL Global Forwarding Global Ocean Freight

Introduction to DHL OCEAN SECURE

Customer Presentation

Feb 2010

2Deutsche Post DHL | PageCONFIDENTIALDHL OCEAN SECURE: Customer Presentation | Feb 2010

Agenda

Key Challenges faced by ‘Higher Value’ Customers

DHL OCEAN SECURE - The Premium Value Proposition

CSD Technology by Savi Networks

5 Building Blocks for the Solution & Operational Execution

Conclusion


Key Challenges faced by many “Higher Value” Customers

transporting their products via Ocean Freight

• Making sure “higher value” products are secure, both from theft & the elements

� Products in transit for longer period of time

� Not under as much direct supervision

� Greater value per container shipment

• Making sure you have visibility of the container within your supply chain

� Due to longer transit and larger quantities knowing where the product is at any point in time can help your inventory management and in meeting customer & market demands (e.g. Customs)

� Being confident the product within the container is in good condition upon arrival

• Combining the two above items means delivering a solution to your “higher value” products

which offers greater levels of reliability but still enjoys the benefit of shipping via ocean


Addressing the Key Challenges faced by Our Customers

in Ocean Freight Transportation

DGF OFR offers a Premium Solution with Enhanced Benefits

Source: 1) Drewery report 4Q 2007; DNV Impact Assessment Report October 2005; 2) Money-back is 2 times of the additional service fee paid by customer, terms and conditions apply

Visibility – Near-to Real-time Monitoring with GPS fixes and Geo-fences

Reliability – Day Definite door-to-door Service

Security – Physical/Electronic Seal

• More stringent SLAs with all players in the chain to offer you

• A money-back guarantee2) on DHL’s OFR day-definite door-to-door service / selected lanes

• Shift from air to sea – Air freight customers switching to ocean freight are demanding greater reliability at lower cost

• Better reliability means lower inventory holding costs and better reaction to customer and market demands

• With a GPS container security device, you have the assurance of knowing real-time where and when your container was opened; with the option of a light intrusion sensor

• The mechanical bolt seal (LSb device) is ISO 17712 compliant pull strength

• Our Control Tower/Operations will initiate immediate corrective actions via the local security response team upon a security alert

• On-Time arrival - only 53% of on-time port arrivals for container shipping1)

• Pro-active monitoring of shipping lines’ performance vis-à-vis published sailing schedules (e.g. visibility of vessel’s ‘slow steaming’/’super-slow steaming’)

• Better planning – more visibility means faster corrective actions by DGF to meet end- to-end transportation commitments to meet your or your customers needs & execute additional downstream planning if required


Agenda





Conclusion


DHL OCEAN SECURE

Our value proposition - One Product with 3 Service Levels supported by

GPS-enabled container security devices (CSDs)

Key FeaturesService Level Service Description/Benefits

• Enhanced Visibility and Security: near real time and e2e GPS tracking via GPRS network comms

• Near real time exception alerts, e.g. milestone delays or security breach of container

• Pro-actively monitor and respond to exception

events along DTD milestones

In addition to the CLASSIC Service

• Environment Sensors: near real time exception alerts of temperature, humidity, shock and/or light variations (options are device specific)

• Dry van Containers

• Reefer Containers (future)

In addition to the PREMIUM Service

• Provide day definite service

• Offers 2-times money back guarantee (selected

lanes & strict terms and conditions apply) in case promised date of delivery not fulfilled

PREMIUM

CLASSIC

TIMESURE

Humidity Monitoring

Temperature Monitoring

Container Security –Door Open Alert

Shock/Light Exposures

Global Positioning (GPS)

Day Definite DTD Reliability

Near real time corrective action


Terms and Conditions

• Valid for Danmar Lines controlled business only

• Service applicable to FCL dry van containers (require on-deck stowage)

• Service will be applicable to FCL Reefer containers in the near future

• Valid for all transport legs, e.g. D-T-D, D-T-P, P-T-D

• If central monitoring/reporting is required, the DHL OCEAN SECURE services must be supported by an existing DGF control tower or Central Ops team

• If central monitoring/reporting is not required, the DHL OCEAN SECURE services will be supported by individual DGF stations

Service Factsheet: CLASSIC and PREMIUM Services

1) E.g. temperature, humidity or shock sensitive


Terms and Conditions

• Valid for Danmar Lines controlled business only

• Danmar controlled business (shipping with DGF selected carriers only, including customs brokerage)

• FCL containers only (on-deck stowage)

• Valid for transport legs: D-T-D, P-T-D � NOT x-T-P, i.e. D-T-P or P-T-P

• Selected lanes only and subject to detailed analysis of the entire transportation lane

• The Timesure service must be carried out via an existing DGF control tower or a dedicated operations personnel/team of an individual DGF station

• Subject to the operational terms and rates of existing OFR “named-account” contracts with specific carriers

• Money back guarantee (2 times the additional service fee1) paid) if the DTD/PTD committed transit time is not fulfilled

• Top-load on vessel is not guaranteed

• Exclusions: Force majeure and other extenuating events beyond DGF’s control

Service Factsheet: TIMESURE Service

1) Service Fee = a fee per container paid in addition to the contracted/agreed OFR transportation rate.


Agenda





Conclusion


2 types of GPS devices are available for standard dry van Containers

Tag

• Global GPS coverage (on-deck stowage)

• GPS location fix frequency is configurable (default: 30 mins)

• Cellular communication (GPRS) with back-haul frequency configurable (default: 4 hours)

• Battery Capacity: 90 days ‘all weather’

• Security: mechanical barrier seal (ISO compliant pull strength)

• Alerts: immediately upon security events

• GPS accuracy:

– 85% of time within +/- 50 meters

– 98% of time within +/- 150 meters

Features

• Same as LS devices

• Environmental sensors (inside)

– Temperature (resolution of 2 deg)

– Humidity (resolution of 2%)

– Shock/Vibration (resolution equal to a 1 inch drop)

– Alerts: immediately upon environmental events

• Optional: light intrusion sensor

• Mounting: “C-clamp” on left door

Container Security Device Technology (1/2)

LS (Location + Security) LSE (Location, Security + Environment)

3


Lock-Bar Mounting solution for reefer containers (under test)

Container Security Device Technology (2/2)3


Agenda





Conclusion


DHL OCEAN SECURE: Building Blocks of the SolutionE

lem

en

ts o

f In

no

va

tive

OF

R S

erv

ices

End-to-end

SC1) mapping

Pro-active

monitoring

& response

Device-pool

management

& logistics

Pick-upHub-Handling

GroundHandling

Customs clearance

PortHandling

Ocean Freight

PortHandling

Customsclearance

GroundHandling

HubHandling

Delivery

Processes

1) Supply Chain

Tools

GPS Device and Communications via GPRS/GSM networks Information System

– GeoView and web access

The overall solution comprises a combination of processes (E2E supply chain

mapping, pro-active monitoring) and tools (GPS device, Information system)

1

2

3

4 5

Via existing DGF Control Towers or Central Operations teams in OFR Stations

Full device-pool management and maintenance with market-leading technology provider


Full Shipment Transparency: Standard Milestones

11 standard milestones defined: Expected timings are mapped and monitored against

near-to real time information from GPS security devices

Standard Milestone Events

Container loading @ customers warehouse

A

Actual customs declaration (update by operations)

BActual arrival @ origin ocean terminal

CActual vessel departure @ port of origin

D

Actual vessel arrival @ stopover/trans-shipment port

E

Actual vessel departure @ stopover/trans-shipment port

FActual arrival in 20 miles area @ destination port

GActual vessel arrival @ destination

H

Container discharged of vessel

I

Customs clearance @ destination (update by operations)

J Actual PODK

Source: DHL Global Forwarding

1


Regular Status Report (Sample) by Savi’s Program Management

6.5 7 8 10 13(A) 15(A) 13(B) 15(B) 19 20 21 24

Container ID Status

Timestamp

Type

Container Departed

Origin Location

Container Arrived at

Port-of-Loading

Export

Customs Cleared

Vessel Departed

Port-of-Loading

Vessel Arrived

at Port-of-Call(Aqaba)

Vessel

Departed Port-of-Call

Vessel Arrived

at Port-of-Call(Jebel Ali)

Vessel

Departed Port-of-Call

Vessel has

Neared Port-of-Discharge

Vessel Arrived at

Port-of-Discharge

Container Discharged

Import

Customs Cleared

Estimated 30-Jul 4-Aug 6-Aug 22-Aug 25-Aug 26-Aug

Actual 30-Jul 3-Aug 5-Aug 15-Aug 21-Aug 24-Aug 26-Aug 26-Aug 26-AugEstimated

Actual 26-Aug 31-Aug 1-SepEstimated

Actual 28-Aug 31-Aug 31-Aug 12-Sep 13-SepEstimated

Actual

MSKU0569081 ||||||||||

MSKU6846049 |||

|||||MRKU0420795

1 E2E Transportation Chain Mapping and Monitoring

The regular status report is distributed through emails.


Pro-active Monitoring of Alerts & Timely Response

DGF Control Tower or Central Operations teams are enabled with GPS

container tracking technology

2

1) For data upload into the web server

Web Server

� Configures devices and geo-fences

� Collects data from all devices

� Raises alerts in case of exceptions

GPS Devices with GPRS

Communications

• Determine position via GPS• Sends data back via GPRS (mobile phone

network) when in reach• Monitors environment (e.g. temperature)

Pro-active Tracking and Exception Management

� Consist of existing DGF Control Towers or origin and destination personnel

� Receives exception notification and determines corrective actions

� Interacts with customer if necessary

DestinationOrigin

Current Limitations

• Container needs to be stowed on deck to keep GPS contact

• GPRS (GSM) connection1)

only available in vicinity of shore (no CDMA: JP/KR)

TECHNOLOGY BACKBONE

• All services are supported with GPS devices for near-to real-time tracking

• Containers will be mounted with device on door for entire DTD journey

• Status updates incl. security alerts, location, environmental events will be transmitted via the GPRS (GSM) global communications network


Actual collected data shows that GPRS coverage, shown below in purple and green, has been excellent on land and has extended up to 20 miles (30 km) offshore.

US SnapshotSource: Savi Networks

GPRS Coverage – Container Movement4


GeoView of GPS Locations and Heartbeat Data5


• New data points are added for changes greater that 2ºC or 2% (not at a regular interval)

• Alerts are triggered when measurements exceed pre-set thresholds

• Full sensor histories are available in Excel format after shipment conclusion

Example:Temperature Graph Depiction

Source: Team, Savi


Agenda





Conclusion


OFR FCL is ready to perform (further) Proof of Concept trials with our

existing customers to demonstrate benefits of new services

DHL OCEAN SECURE - Introductory Offer

Offer valid until Q1 2010 – Extended!

• Free customer trials (1st 20 customers) for up to 6container security devices each

• Money back guarantee is not part of introductory offer

Key Criteria for Offer

• DANMAR controlled OFR business

• Minimum volume of 15 FCL containers per month

• D-T-D or P-T-D lanes only

• Existing control tower, central operations team or supply chain coordinators monitoring OFR shipments

• High value and/or highly sensitive cargo

�Subject to final approval by OFR Global FCL


BACKUP


540

ALL FIGURESARE ESTIMATES

Source: DP DHL Inhouse Consulting; Based on study from Prof. Hau Lee – Study for SST (Smart and Secure Tradelanes); 1) Effect distribution to Transparency, Reliability and Transit time estimated

Independent studies have shown if customer can address

transparency, reliability & lead time, savings can be achieved

Savings Potential from each Service for Customer

Assumptions

• Average value per

container is $100,000

• Transportation cost on

trans continental route is

$ 2,000

• Variability of lead time

reduced +/-4 to +/-2

days and transparency

increased

• Lead time reduced from

47 to 42 days

– in $ per container –

Transparency1)

239

Reliability1)

237

Transit time1)

250

130

80

40

40

Total savings

64

Value proposition for Customers’ E2E Supply Chain

EXAMPLE STUDY

Safety stock

Pipeline inventory

Pilferage & loss

Admin labor

Service charges

24

Shock Alerts

Extreme*>120 G>153

3.9 ms5 in.117 G149

4.3 ms4 in.98 G130

4.7 ms3 in.81 G112

5.5 ms2 in.55 G86

6.8 ms1 in.32 G63

Insignificant*<25 G<55

Impact DurationDrop HeightImpact ForceRaw Data

*sensor accuracy decreases beyond this point

• The shock sensor reports a 0 unless it measures a force greater than 25x gravity (equivalent to a drop of ~3cm)

• SaviTrak displays shock measurements in the raw data sent from the sensor module

• Any shock reported by an LSE tag will add an environmental alert

– This will send an email to users configured to receive them

– Alerts are also displayed in the Container Visibility & Event Management pages