Seeing More Clearly? Assessing the Cost-Benefit Value of Container Sensors: The TPM Breakdown

In our modern world, technology is everything. It is the driving force behind things that we do and, more importantly, what we can do. It comes as no surprise that new technologies are bringing about a serious and much-needed overhaul to the global ocean freight industry.

In 1956, Malcolm McLean invented the first shipping container, a simple invention that changed the world. However, that invention has changed little until recently. One of the newer innovations is the concept of a smart container. Rather than a simple steel box used to transport freight, a smart container is loaded with various sensors that can track and record the storage conditions of freight during its end-to-end journey through the supply chain. 

But what exactly are these sensors? What are they capable of tracking? And is it the best choice for every shipper?

Ocean Insights was proud to be a part of JOC’s TPM21 this year and we were able to discuss the matter of sensor-enabled “smart-containers” and their role in the supply chain. 

The Benefits of Container Sensors 

A sensor in its simplest form is a device that provides useful feedback on a physical process in a way that is both consistent and measurable. Smart sensors, on the other hand, go well beyond that.  

“Smart sensors are advanced platforms with onboard technologies such as microprocessors, storage, diagnostics, and connectivity tools that transform traditional feedback signals into true digital insights. These smart sensors can provide the timely and valuable data underpinnings to power analytical insights that can in turn drive improvements in cost, performance, or customer experience,” according to a Deloitte publication.

These smart sensors are not only capable of tracking a wide range of conditions during shipment, but can also transmit that information directly to a shipper, providing real-time feedback on the condition of their freight. The following is a breakdown of the most common smart sensors used on the market today: 

  • Container Geolocation
  • Temperature Fluctuations
  • Geofencing and Predictive ETA
  • Shock Detection
  • Door open/close status
  • Late in/Out site
  • Any Unusual Activity

Depending on the needs of the freight being shipped, these sensors can track the various conditions and exposures that freight might be subjected to during its transportation. 

Electronics are an excellent example of this. Being highly sensitive to any sort of electrical shock, magnetism, and moisture, a smart container would be able to collect and relay information should the freight be exposed to any sort of conditions that could affect the overall quality and function of the products being shipped. 

Sensors aren’t the Best Choice for Every Shipper

In truth, only certain types of freight benefit from being monitored by sensors, such as perishable goods, sensitive chemicals, perishable items such as food, and high-value items that are prone to theft. Otherwise, shippers might receive better value from utilizing the services of an Ocean Freight Tracking System (OFTS) instead. 

Container sensors, while good at what they do, have some noticeable drawbacks. For starters, the technology is expensive, and not only needs to be implemented but also maintained. This creates a supply chain in its own right, which needs to be managed and accumulates its own running costs. 

Additionally, unless the ship transporting them is equipped with a satellite relay or transmission system, sensor-laden containers buried under the bottom of the stack won’t be able to transmit data properly, leaving sizeable gaps in the recording and rendering the information collected spotty at best. 

Every Shipper Needs Real-time Visibility

Better visibility also translates into lower operational costs. With the ocean freight market being turbulent at the best of times, controlling freight costs is the lifeline for any company shipping freight across the ocean. 

One of the most direct costs shippers can control is the fines and penalties generated from detention and demurrage charges. D & D charges are a painful reality of shipping ocean freight, capable of quickly destroying the annual freight budget. Shippers need to have a system in place that can help to keep track of where containers get delayed during transit, which could lead to possible demurrage and detention fees.  

While container sensors provide considerable amounts of data, not all of it is relevant to every shipper. Instead, using data derived from a traditional visibility provider might be the better option in terms of both cost and functionality. Data received from visibility providers can be aggregated and contextualized into status messages from container lines and terminals which, in turn, can be turned into a predictive insight. 

This is where an ocean freight tracking system can become invaluable.

Sensors can provide helpful information, but an ocean freight tracking system can interpret information into something actionable. Not only does this reduce the risk of demurrage and detention, a massive cost-saver in its own right, but it does so in a way that is simple, intuitive, and automated. An automated system reduces or removes the need for human labor hours, which would typically be consumed during a manual data entry process. 

How Ocean Insights Can Help

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Currently, the biggest barrier to smart containers is the upfront cost necessary to outfit containers and the subsequent cost to maintain those containers. As the adoption of the technology continues the price will inevitably go down which might make it a viable option in the future. 

However, that doesn’t mean that shippers can’t start taking steps in the right direction today. If smart containers are cost-prohibitive, an Ocean Freight Tracking System (OFTS) could be exactly what your company needs, especially if you’re looking to decrease costs, increase visibility, and improve your overall operational efficiency. 

At Ocean Insights, we believe the process should be simple. Everything from an easy-to-use interface, to a dashboard that shows you exactly where your containers are, with little more than a click. Contact us today to learn more.