managing global shipping risks presented by greg j. kritz, cic vice president sctic may 27, 2008 ...
TRANSCRIPT
Managing Global Shipping Risks
Presented by
Greg J. Kritz, CICVice President
SCTIC May 27, 2008 www.roanoketrade.com
USA England Ireland China Singapore UAE Germany
3. Control the Risk
*Avoid It *Prevent It *Reduce It
U.S. Cargo Losses Exceed $18 Billion Annual Impact on U.S Economy
4. Finance the Risk [how you’ll pay for bad stuff when it happens to you]
* Transfer the risk to an Insurance Company* Retain the risk [self-insure]
Examples of Today’s Shipping Risks
CyclonesDelayProduct Recall Non-paymentEarthquakesInclement WeatherTariff Retaliation
Currency ValuationCargo TheftRegulatory SeizureEnvironmental Hurricane/MonsoonPolitical (Nationalization)
Extremes in Temperature
Ocean Carrier/NVOCC
Subject to terms of Carriage Of Goods by Sea Act (COGSA)
$500 per Customary Shipping Unit as described on OBL
Unit can be the container, a pallet, a crate, carton
International Air & Indirect Air Carriers
Subject to terms of the “Warsaw Convention”
$9.07 pound/$20 Kilo or 17 SDR Kilo if Montreal Protocol ($25 kilo)
Distribution Centers & 3PL Facilities
• Warehouseman’s Terms & Conditions
Rule Unless Changed by Contract
• Liability Typically a multiple of base rate
• 3PL’s and Forwarding Operations Often Limit Liability on Warehouse Receipts
• Reasonable Care Standard Applies
LOSS of BUSINESS INCOME:
IMPORTERS NIGHTMARE
A Property Insurance Policy Doesn’t Cover Loss of Business Income for Cargo Claims
What if these wereYours’ at Peak Season? $30M
CARGO CRIME SOARING
Theft & Unexplained Shortages (shrinkage/Leakage)
4 Easy Ways to AccessAn Ocean ContainerWithout Leaving a Trace
273 Hurricanes Hit USA1851-2005
92 Were Major Category 3,4 & 5