'Project Cargo' vs 'project cargo'
Lars Martin Greiner
Recognised leader in Ports and Logistics. Inspiring sustainable teams designing innovation
I believe it is now time for us to clarify the terminology in the Logistics and Transport industries, and boy, this is actually a big job. Some companies use FFE (forty foot equivalent) while some still use FFU (Forty Foot Unit) there are dozens of these, even the term 'logistics' is way too loosely thrown about, not to mention 3PL or 4PL, many do not even understand what these are, but thats another story.
So i am going to try and start small, even within the logistics industry, we cannot agree on what 'project cargo' is, while actually, this should be cut and dried. A project cargo, is cargo related to a particular capital project, it will be multiple shipments, made up of both containers, non containers and probably a couple of out of gauge shipments. Shipments will take place over a couple of months or even years and will likely require dedicated staff and potentially even on-site, or in transit storage or consolidation points. It is a multi million dollar adventure, with high risk to the service provider, who takes on significant risk, and normally a margin of credit, to the project owner. Compliance, Health, Safety, Quality and enviromental aspects all need to be present, with expert involvement on this as well as the planning, loading and handling of cargos.
On the other hand, too often, people talk of project shipments, when it is a single large out of gauge shipment. while this is also technical and requires expertise, this is an out of gauge and/or a heavy lift shipment, and not a project. While it requires much planning and preparation, and whilst you may consider this a project for your team. This is NOT a project in terms of the the cargo itself. It is a heavy lift shipment.
Why is this important, simple; Experience! Unfortunately in Logistics, there is no barrier to entrance, so anyone can say they do logistics, or even project logistics, and there is no way to prove their knowledge, except to ask for a cv and see what projects they have done. It is strange as in many projects, the engineering companies are at pains to ensure the degrees and qualifications of the engineers, but then try to save costs on logistics without knowing what they are getting.
You see, the experienced logistics professional, with many years and project under his belt, has to compete on every project with the inexperienced rookie, on the same battlefield, he is not compensated for his learning period, as an engineer would be, and that pulls down the level of the project as a whole on projects.
Just a thought, comments welcome.
A-Bar-C Services Lead Technical Consultant - SERVING THE LOGISTICS COMMUNITY
6yExcellent initiative Lars, Respect!!To me KISS.For a port terminal operator, PORJECT CARGO, is any cargo loaded onto or off a vessel that requires more than the standard rigging and/or handling.If you cannot use the usual 20'/40' spreader or gear normally used to work a vessel, then it can be referred to as a project.Simply because, it now requires more than normal operations management and skill sets.Even on a multi=purpose quay.
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6yHi Lars, there is a lack of understanding of the clear formal terms when it comes to such issues.. What I have seen practically is that if it is containerised cargo, it is referred to as a 20' or 40' container, but the minute it extends to OOG alongwith a few pieces of conventional cargo, then it gets a bit tricky and becomes a "project cargo" in the minds of many customers.. In my opinion, the formal definition of project cargo would be "any cargo in any shape/size/mode of transport even, linked to a certain project whether it is short term or long term".. For example if it is a power plant project, the company could engage a few suppliers for supply by sea, by air, by road, by rail, by drone depending on their capability and suitability.. Say for example the power plant project started in 2000 and the plant was commissioned in 2008.. If the contract or tender covered the supply of material/equipment till the commissioning of the plan and contracts were given to various suppliers as above based on their capabilities, then all of them may be considered as project cargoes for that particular project.. Usually the project should end once the commissioning of the plant or project is done and anything done after that maybe considered replenishment orders..
Recognised leader in Ports and Logistics. Inspiring sustainable teams designing innovation
6yMy main point in the article remains the same, the specialised knowledge required and acquired for projects is not being given the value it should in the market, because of the way projects are looked at; as normal cargo but slightly bigger. this means many without the necessary experience, think they can get into this 'easily.' Imagine, Thomas, if someone who had never loaded a cargo before tried to stow the cargo of your last post, well this is what is happening from a commercial, pricing point of view on door to door moves, and it not only lowers the income while increasing the hidden costs and risks, but also seriously undermines the integrity of our industry with its clients.
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6yNot agreeing 100 pct. A project cargo is cargo which is for a specific project. Can be mix of different cargo types or all of the same type. That is not specified in any term. Also isn‘t there a specific time period somewhere specified as from which duration we talk about project cargo or normal voyage charter. If, for example, charterer xyz has the project named abc which consists of the installation of one oog tank. Then it is in my world project cargo. I would define project cargo as cargo which is as such declared by the charterer. Further project cargo should involve a certain amount of planning and engineering and maybe penalties involve for late arrival. Rest is either heavylift/oog or breakbulk. My 10 cents into this