—
Picture this.
Imagine a customer places a custom order on your website to buy a product. Then to process this order, you ordered some raw materials from your supplier overseas. Based on previous experience, you expect the package to arrive in less than one week. But somehow, you’ve waited for more than two weeks, and you still haven’t gotten it.
Each time you reach out to them at the port to request your package clearance, they respond with a message stating that your cargo is still under inspection and verification.
How would you feel hearing this? Completely devastated.
Well, who wouldn’t? Cargo delay is not in any way a nice experience.
This post wants to address the common reasons for cargo delays and ways legal entity identifiers can help sort them out. Sit tight and learn.
Common reasons for cargo delays
1. Changes in weather conditions
When there’s a shift in the weather conditions at sea, it’s normal for ships to change their routes temporarily until stable weather is attained.
Unfortunately, route swift may result in delays in ship arrival times. This delay can be as long as a week or two. If the sea storm is so huge that it causes damage to ships, expect the delay to run for longer.
2. No space at the berth
As you can imagine, some ports are just naturally busy, especially at seasonal times. Ports like Rotterdam, New York, and Shanghai are some of the busiest ports in the world. If you have shipments coming from these angles, expect to wait longer than usual.
Although, recently, many of these ports have started adopting the latest technologies to hasten things up. If your cargo is aligned with these technologies, you can expect your delivery to arrive on time.
For example, one of such technologies is the digitized legal entity identifier (LEI) number. If your brand has secured an LEI registration number, it will be easier for port officials to verify your cargo, thereby making it faster to discharge your shipment.
3. Too many pending cargos
During and after the pandemic, many ports suffered from hefty berth traffic as more and more shipments arrived due to increased demand for e-commerce products.
Unfortunately, the pandemic has claimed a significant fraction of many ports’ workforce, causing what’s known worldwide as a global shipping crisis.
If you’re expecting a shipment around this time, you should expect a delay in delivery because there are too many cargos waiting in line to be cleared.
How LEI can help your cargo beat the crowd at the port
So far, we’ve mentioned the legal entity identifier, LEI a number of times. For the benefit of those who don’t know what LEI is, let’s take a quick look at it.
What is an LEI?
LEI, or legal entity identifier, is a global reference code — like a bar code — used across industries to uniquely identify businesses.
When you have an LEI code for your business, it makes it easy for anyone to quickly find everything they need to know about your business.
So, how does LEI help to get your cargos cleared at seaports?
Generally speaking, cargo clearance entails a multi-document screening process, wherein port officials have to skim through many documents to ascertain to who a cargo belongs. Traditionally, this process used to take a number of hours to execute. With the impact of COVID, the process has gotten a lot longer.
Luckily, businesses that have secured legal entity identifiers are able to beat the crowd because LEI may help cut through the red tape. Instead of port officials needing to check four, five, or six documents to verify a cargo, an LEI code allows them to do the same in just a few seconds. This is called data consolidation, and here’s an article from the Asian Development Bank that backs up this claim. Here’s another piece from Forbes supporting the claim that LEI number can get attached to products (cargos), thus enabling quick product verification around the world.
By inputting a cargo’s company name on the official legal entity identifier site, port officials will quickly see that the cargo belongs to a reputable company. With this information, they will have fewer reasons to doubt your cargo’s legitimacy, thus reducing the number of checks required to clear it.
4. Technical faults at ports
If your shipment is coming from developing countries, it’s not uncommon to have instances of faulty equipment causing a delay.
This happens almost every time. Due to the fact that many of these ports still run on outdated machinery and poorly-skilled employees, mistakes and faults are not always farfetched.
Unfortunately, when a technical fault arises, cargo owners are usually on the receiving end of the disappointments because it is they who won’t receive their shipments on time.
5. Issues with custom
Sometimes, cargo delays might come from customs officials. They may want to inspect your cargos or other cargos because they have a suspicion regarding the entire freight. It may take longer than usual to complete your delivery when this happens.
A good way to exempt your cargo from lengthy custom checks is by getting a legal entity identifier number. As we said earlier, LEIs go a long way in reassuring people (business partners and government agencies) that a brand is credible. When custom officials see a legal entity identifier number they can link your cargos to, it helps assuage some of the suspicions they may have.
6. Lack of clarity
If there is a lack of clarity at any point in the supply chain – whether from you, the logistics company, or a freight forwarder – expect your cargo delivery to take longer than usual.
Lack of clarity can come in the following forms:
- Insufficient cargo description
- Inaccurate or poor quality shipment labeling
- A change in the destination address
- Wrong exchange of information between you and the many parties involved in the delivery chain.
The best way to ensure your cargo doesn’t get delayed for this reason is to use logistics management software. This will help you keep track of every important detail. Also, logistics management software can help to discover discrepancies in the cargo delivery chain before they cause major hurdles.
7. Transshipment
Sometimes your cargo may be coming to you via indirect voyage. Indirect voyage, or transshipment, is when cargo has to first arrive at an initial port before being sent on another ship to its final destination.
You can expect your cargo delivery to experience some unforeseen delays before it gets to you when this is the case.
The best way to ensure this doesn’t happen is to determine whether it’s possible to get your cargo delivered in one straight voyage before applying with a freight forwarder.
8. Criminal activities
Even if you’re using the most secure shipping line to get your shipment across, you must remember that humans still run these lines. As such, it’s not impossible to find smugglers, pirates, and thieves amongst the ship workers.
As much as this reason might seem like the least possible one, it’s not one you can just look past. Over the years, we’ve heard reports of shipments getting lost because ship workers decided to help themselves to stuff.
The best way to ensure your cargo doesn’t become a victim of circumstances is to research the shipping line or logistics forwarder you’re using beforehand.
Last words
A delay is inevitable if you don’t do your due diligence to get your cargo delivered by a trusted company. Many of these companies out there might promise you cheaper deals, but it comes at the expense of your delivery time.
Be careful who you work with.
—
