Every third container being moved is empty. That’s at least 60 million empty container moves every year. We’ll dig into the reasons for this massive number and look at how you can minimize your empty container repositioning costs.
If you Google “reduce empty container repositioning costs” tons of different options come up with as many ideas as to how you can reduce your costs. All container owners and companies are different. However, regardless of your company size and goals, we can help you reduce your empty container repositioning costs with ease.
On Container xChange’s digital platform, we connect you with 1,500+ vetted logistics companies around the world. We are the world’s first neutral online platform for trading and leasing containers globally. Our platform offers a range of services that can help with empty container repositioning, including container tracking, trading, container interchanges and one-way leasing.
With real-time tracking, you can monitor your box and effectively plan your container movements. This ensures that containers are in the locations where they need to be, and all your operations flow smoothly.
You will read more about how your business can make the most out of our other benefits and save money on repositioning empties in a few minutes. But first, let’s quickly understand the meaning of empty container repositioning.
What is empty container repositioning?
Empty container repositioning refers to moving empty containers from an area with a surplus of containers to a location with a deficit. For container owners, empty container repositioning has a substantial economic downside. Every year, moving empty containers costs the industry more than $20bn. That’s more than 12% of operating costs for shipping lines. And that’s probably the reason you’re here trying to figure out how to save money on these costs.
Let’s imagine this scenario: You have 200 containers in Hamburg. The boxes must be moved to, let’s say Shanghai, to carry export cargo. None of your northern European customers need these boxes for exports though. That leaves you with having to move your empty containers from Hamburg to Shanghai. It becomes both time-consuming and very expensive when you have to pay for handling charges at terminals and ports. Storage and maintenance at warehouses, as well as inland transportation, and seabourn repositioning are also costly.
You might have been in a similar situation at some point. And you’re far from being the only one.
Empty container repositioning is a widespread and real problem in the shipping industry. And it seems to have gotten worse in recent times because of the rapid growth and regional differences. European and American ports experience a high surplus of empty containers, and at the same time, Asian ports face severe shortages.
What causes empty container repositioning?
There are 170 million containers being moved around the world via different methods of freight, and of that number, an additional 50 million boxes are empty. Many things can contribute to empty container repositioning such as:
- Trade imbalances
- Structural imbalances
- Time specific imbalances
- Company specific imbalances
It’s a never-ending cycle of moving your empty containers to where you need them. This is also why container interchange between carriers has become a way for many to save money.
Many container owners swallow the empty repositioning costs because it seems too unmanageable, at times, to do anything differently, but it doesn’t have to be.
What if we told you that there was an easy way to find trustworthy container users who’d move your containers? You wouldn’t have to spend any money moving your container – and could skip lengthy contract negotiations.
Try our search function here to find partners for free container repositioning! All you have to do is choose “I want to supply containers” and fill out where you have containers and want them dropped off. You’ll get a list of container users in your desired locations who are ready to use your boxes almost instantly. Check it out for yourself!👇
Now, let’s get back to the problem at hand. Why is empty container repositioning such a big problem in our industry?
Trade imbalances and inefficiencies
Around 2/3 of all empty container moves come from trade imbalances between regions. The remaining 1/3 of these repositioning costs are related to carrier-specific inefficiencies that can be difficult to overcome.
Revenue generation
It takes several weeks to find a new customer to export cargo, load the container, and bring it back to the port. All that to earn profits of approximately US$800. That’s why container owners rarely wait for export loads to be available. Instead, they often reposition their empty containers back in the Asian region. By doing this, container owners can generate a profit of US$3000.
Manufacturing and leasing costs
If the costs of manufacturing new containers or leasing boxes are cheaper than repositioning them, the containers can accumulate. Sometimes, it’s even cheaper to sell containers in surplus locations and buy new units in Asia. So, when it costs more to manufacture or lease containers, the amount of empty container repositioning also goes up.
Specific customer demand
Sizes and types of available empty shipping containers don’t always match what the customers are looking for. Maybe they need different container types (reefers, open-tops or high-cube containers), and container conditions (cargo-worthy, food-grade, or newly built units).
No clear visibility on costs
Usually, the logistics team manages empty container repositioning globally. A procurement team controls costs on a vendor-based level. That can lead to situations where carriers know total costs, but the drivers behind these costs remain unclear. Their fleet management systems don’t answer questions such as how many containers were moved, or why were these containers moved.
Carrier network
A row of issues within a shipping line’s network can cause empty container moves and high storage fees. Such issues can be a delay, the absence of direct vessels, or an inland network link between locations.
Unreliable forecasting
Often, container owners over-forecast demand. Their analysis often relies strongly on agents and gut feeling. And it’s not exactly easy to include port congestion, labor strikes, or the weather. The same goes for changes in seasonal and trade demands. Low accuracy of economic forecasts means that these forecasts are less helpful when container companies plan their container stock. This also leads to unnecessarily high head-haul volume.
Headhaul volume
Sales teams contribute to a high number of unused containers. They focus on increasing head haul volume rather than optimizing container flows. In a highly competitive shipping market and due to demanding customers, the sales forces concentrate on container availability to sell units to the customer.
How to avoid empty container repositioning
Sharing equipment globally is a popular way of avoiding empty container repositioning. Hinterland triangulation sends import containers directly to export customers of the same company. At the same time, container interchanges reduce the number of empty containers through partnerships with other carriers.
Container xChange is the biggest platform for container interchanges with more than 1500 shipping companies. We let container owners, like you, find partners that move their containers from surplus to deficit locations. We also allow you to downsize your equipment pool.
You can benefit from that on a number of levels:
| Lower capital expenditures | Capital expenditures refers to the money used to maintain fixed assets. The lower the CapEx, the better it is for you. |
| Reduced consumption of resources | Reducing consumption of resources increases sustainability. |
| Reduced costs for depot storage and terminal space. | Less costs for storage means you get more for less. Storage space for lower charges. |
So, our online platform, Container xChange helps you:
- Reduce your empty container repositioning costs
- Find trustworthy partners
- Skip the hassle of lengthy contract negotiations, background checks, and endless emails
Avoid empty repositioning charges with one-way containers on Container xChange
As much as container interchange can aid you with empty container repositioning, it can’t entirely help avoid this problem, especially when the global market is facing trade imbalances.
But what if you could get someone to move your empty containers to the destination to help stabilize the trade imbalance? You wouldn’t have to pay to move the containers and you’d be free of the administrative hassle of figuring out slots on the vessel, trucking, and so on.
Using your boxes as one-way containers can help you save money on empty container repositioning. One-way containers are also known as cabotage containers. The container user leases your container for one-way journeys, e.g. from Los Angeles, US to Shanghai, China. That’s it. You get your container moved for free and they get their cargo moved too.
On our platform, one-way moves can become your reality to eliminate container imbalances and, thus, curb empty container repositioning. So, come on over to our platform and scroll through container users interested in moving your boxes for you. You’ll be able to see peer reviews from former partners – and see who they’ve worked with so far. When you find a company you like you can send them a message and negotiate terms such as free days and per diems. These will all be based on the standard contract you’ve filled out beforehand. Making your negotiations smoother and your work faster.
Want to see how easy it is? Click on the banner below, and our hands-on team will be more than happy to help.
Empty container repositioning: Common FAQs
What is empty container repositioning?
Empty container repositioning refers to moving empty containers from an area with a surplus of containers to a location with a deficit.
How do you reduce empty container repositioning costs?
Sharing equipment globally is a popular way of avoiding empty container repositioning. Hinterland triangulation sends import containers directly to export customers of the same company.
What causes empty container repositioning?
Empty container repositioning can be caused by a number of things, some of them being trade imbalance, structural imbalance, time specific and company specific imbalances.
