Traxens, the smart-container service provider, announced Tuesday the acquisition of NEXT4, a French supplier of removable and reusable shipping container trackers, for an undisclosed amount. Traxens CEO David Marchand and NEXT4 CEO Cedric Rosemont spoke with American Shipper on the company’s outlook on trade and how congestion is fueling opportunities for logistics data companies.
LORI ANN LaROCCO: This investment is just another example of thirst for real-time data. Key Traxens shareholders include ocean carriers CMA, MSC and Maersk. They are also users of your technology. Can you talk about the layering effect of data this acquisition will have in the faster dissemination of fuller data?
DAVID MARCHAND: “Importers are hamstrung by the lack of details that are available to them from carriers, ports, forwarders and other service providers. The current situation is that all these details vary quite a bit, so even though there is information, it is difficult for importers to verify these. By installing these IoT devices by Traxens and NEXT4, importers don’t need to have this uncertainty. As long as the devices are on their containers, they can know exactly where these containers are irrespective of whatever information they get from whichever entity.
“These devices offer real-time tracking about the whereabouts of the container. The only difference between the Traxens and NEXT4 devices is that the Traxens devices are permanently attached to the container, whereas NEXT4 is a portable device which makes it easier for it to be attached to any container that the customer needs to track.
“These devices transmit information of where the containers are, whether it has been opened, stopped and other unexpected deviations.
“NEXT4 offers another option for shippers and their logistics providers to track in real time the whereabouts of their cargo. Whereas the Traxens devices are permanently attached to a container, the NEXT4 is removable and can be attached to the container at the time of stuffing, and be removed when cargo reaches its destination. No need to wait for an already equipped container. This offers greater flexibility for importers, in particular at times of higher tension on the global supply chain.”
CEDRIC ROSEMONT: “Creating a digital twin of those boxes is the best way to understand [how to solve] problems. Traxens and NEXT4 solutions are both the best way to understand where, when and why a container is stopped [or] opened.
“Enabling to get precise ‘free time reached’ alerts, detention and demurrages over costs or again delivering a proof of who is responsible for a problem — this is the key success of our solutions.”
LaROCCO: How have consumer needs transformed over the pandemic?
MARCHAND: “Consumer spending has dramatically changed since the pandemic. Armed with extra cash that would have normally gone into travel, fuel and other activities restricted during the pandemic, the consumers have found the simplicity and ease of ordering goods online quite appealing.
“In our view, this realization has been the catalyst to the burgeoning demand that we are seeing. But along with this increase in demand for goods, the consumers’ demand for greater transparency and instant information about their cargo has also increased dramatically.”
LaROCCO: Have the demands and urgency for real-time data increased as we have seen the ocean carriers diversify their logistics businesses?
MARCHAND: “Absolutely. Demand for real-time data such as notifications and alerts when something unusual happens has increased. At the same time, we have seen carriers increasing their capacity of transportation on the most demanded routes at the expense of the less demanded ones. Some routes have closed in the last couple of years, whilst the size of vessels has increased.
“In the past few months, though, in anticipation of a return to more normal times, ocean carriers have engaged in a fierce battle of acquisitions, targeting terminals, freight forwarders and last-mile logistics providers. They like to extend their value proposition and offer ‘end-to-end’ logistics services to their customers. Doing so, carriers become less and less carriers, and more and more fully integrated logistics providers.
“A lot of our customers use real-time data to enhance their control tower and try to improve their lead time.”
LaROCCO:Time is money and visibility enables logistics managers to plan — what kind of visibility does this offer?
MARCHAND: “At Traxens, we talked about ‘transparency’ more than visibility since our solution is much more than some checkpoints during the cargo trip for shippers. For shipping lines, they can optimize supply with demands, by repositioning empty containers where customers need them for their next trip.
“Containers need to be maintained occasionally: It could be as simple as a new coat of paint on a dry container, a replacement of the hatch on the front door, or predictive maintenance of the engine of a reefer container. Real-time data coming out of the container helps logistics managers anticipate and minimize idle time. All movements of containers are recorded and analyzed in real time. That enables logistics managers to accurately optimize the fluidity of logistics flows across the supply chain, anticipate congestion on ports terminals, accelerate loading and unloading of vessels, and plan for the right number of trucks to move containers from a vessel to the end customer’s location.
“Empty container return can be accurately recorded to automatically trigger an invoice and a payment.”
LaROCCO: Are you seeing more containers moving to the East Coast?
MARCHAND: “If you are asking about containers moving by ship to the East Coast due to the congestion in the West Coast, our data has shown some movement although we suspect not as much as the consumers would have liked. As the Traxens solutions are also used by shipping lines, lines do move containers across states to resolve the demand for containers and reallocate … empty and unused containers from time to time.”
LaROCCO: How long are containers waiting in China on the land side? Zero-COVID trucker restrictions have gummed up the drayage of these boxes.
MARCHAND: “We can say that known port congestion is only the tip of the iceberg.”
LaROCCO: How nimble is Chinese drayage? For example, when Ningbo was partially closed, you saw containers moving to Shanghai.
MARCHAND: “Compared to other countries in Europe and to the U.S., Chinese operators are very agile and quick to adapt to changes. Where it may take several months to increase shifts on the West Coast of the United States, Chinese ports make the necessary adjustment in a blink. We have seen a concentration of trades through Shanghai in the past couple of years, and carriers have increased their capacity to and from Shanghai, in response to a skyrocketing demand. Freight rates have increased and vessels are 100% full months in advance.”