Gaining Competitive Advantage: Benefits and Opportunities with SOC Containers

Learn from Christian Roeloffs (CEO, Container xChange) and Vinod Krishna (CEO, Nerida Shipping) and don’t forget to take the SOC Assessment to test your knowledge, and get certified afterwards.

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Summary

SOC containers can help you through container shortage, ensure low freight rates, and avoid demurrage and detention. Want to learn more about SOCs? Then keep reading.

We’ve sat down with CEO and co-founder of Container xChange, Christian Roeloffs, alongside CEO of Nerrida Shipping, Vinod Krishnan, to shed more light on the perks of using SOC and COC containers. Here’s a quick recap of what we learned from their masterclass in the video above.

First, let’s determine some key terms before we dive in. Because what are SOC and COC containers?
SOC containers are also known as Shipper Owned Containers. A SOC container is a container that the shipper or freight forwarder, as the representative of the shipper, brings to the shipping line. That’s instead of booking the container offered by the mainline. So, you bring the cargo with your own box to the vessel.

A container is considered a COC container when the carrier owns the box and controls most of the transport chain. That’s why, COCs are also known as Carrier Owned Containers. Once your cargo is delivered, you no longer need to worry about the container.

Read more about the definitions of SOCs and COCs in this blog.

The benefits of SOC containers

Can you always afford to pay the “all-in fee” and let the carrier take care of the entire move? Then there’s not much reason for you to consider SOCs. But if you want to save money and get the containers that fit your needs then it would be worth your time checking out SOCs.

Here are three of the main benefits of using SOC containers:

Countering the equipment shortage
SOCs can be a help when exporting from locations facing equipment shortage. Especially now, during the COVID-19 crisis, there are not enough containers around. When you book the containers from the shipping lines they are unable to fulfill the booking, or you’re asked to bring the containers from the faraway locations and pay high tracking costs. With SOCs you might be able to save on these expenses.

Low freight rates
This is particularly true when you ship to the locations with a significant equipment surplus. The shipping lines are always happy when they don’t have to bring new boxes into these locations and then reposition the empty ones again. Usually, you’ll get a significant freight rate discount, when you bring a SOC container there.

No Demurrage & Detention charges
If you deliver a COC container a couple of days later, the overtime can amount to hundreds of dollars in d&d charges. That ruins freight rate calculation. With SOCs you don’t have that problem, as container owners charge very low per diem fees. Because when you use their containers, they save money on storage and empty repositioning.

Challenges of using SOC containers

Of course, with the increased freedom, you also get more responsibility. These responsibilities are mostly of an operational nature. For example:

  • You have to source your containers

  • You have to book the slots separately for the container

  • You have to manage separate deals through the chain of transport

For SOC user Vinod Krishnan lack of space for SOC containers on vessels is the main challenge operators face nowadays:
“Especially when the demand is high, it can be difficult to get a space from the freight forwarders and arrange the movement of these containers,” he said in the masterclass.

As a NVOCC operator, his company also struggles with meeting the dedicated time frames and free days. Something that makes the low per diem fees even more important.

But how does Vinod Krishnan then source the SOC containers he needs?
“xChange has helped me source containers from various companies. It has helped me establish contacts with more operators, carriers, which want to move their stock,” says Vinod Krishnan.

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