The Customers
Core Fruit is a premium quality fresh produce exporter based in South Africa, exporting around 16,000 containers this year to 265 customers, reaching 65 countries and 105 ports.
Their model is simple – linking top growers’ produce with key markets, ensuring that every grade of fruit is placed with the most suitable market, and providing the growers with sustainable returns for their crops.
Open Markets Corp is a smaller customer based in North America with a volume of around 200 containers per year. They source and import a large variety of fresh fruit, vegetables, frozen products, white and yellow corn, beans, beverages, and frozen meat from Latin American countries.
Their deep knowledge and growing network of strategic alliances with food processing companies allow them to develop the most complete line of products with the specific brand of our clients for the Hispanic market in the United States.
Our Value Protect Global Product Manager, Jane Creek, interviewed both customers to see how Maersk’s extended liability product has helped their business over the past year.
The Challenge
With any shipment, there is always a risk that something could happen to the cargo or the container, but this risk can be increased when transporting sensitive cargo, such as fresh produce, due to the commodity's nature and shelf life.
If the container has been unfortunately delayed, cargo has been damaged due to an incident on board, or if the container has had a reefer malfunction, then there is a chance that the quality of the cargo has been affected by the time it arrives at its destination.
With incidents like this, the worst-case scenario is that the cargo can be spoiled and unusable, resulting in a financial loss to the shipper. Depending on what cover, if any, the shipper has on their cargo, they may or may not be able to claim for the loss or damage of it. There are specific incidents for which the carrier is liable; however, the compensation payout is limited and does not always cover the entire cargo value. When scenarios like this occur, it can be detrimental to the shipper, and they can end up being out of pocket.
We have Marine Insurance for our entire logistics chain, as with logistics out of Africa, we've got a lot of challenges, so we have to be insured, but Value Protect gives us more value than Marine Insurance. We pay a bit of extra money, but the results we get from Maersk are huge. We cannot claim per container with Marine Insurance and need to claim for the entire vessel, so we will only use Marine Insurance when a vessel goes under, for example. Value Protect compensates us if something goes wrong per container.
The Solution
As one of Maersk’s Logistics and Services products, Maersk offered both customers our simple add-on solution, ‘Value Protect’. Value Protect is an extended liability product that will provide our customers an extra layer of security when shipping their cargo with us, bringing additional peace of mind. With a fixed pricing structure and no additional costs, the protection has been added once the charge is added to the ocean invoice.
Value Protect has 11 package types with different coverage levels, depending on the cargo value, that can be applied to all containerised shipments of all commodities. It can be used in addition to a customer’s standard coverage, such as Cargo and Marine Insurance. Simple yet efficient, it extends the liability for terms of carriage to cover aspects that are not usually included in traditional terms – whether that’s damages caused by delay or fire.
Both Core Fruit and Open Markets Corp applied one of our ‘Cool packages’ to their contracts for their reefer shipments, which are tailored for refrigerated cargo. Since then, when incidents have occurred that have been covered by Value Protect’s terms and conditions, they have used Value Protect to claim for their cargo loss.
When submitting a Value Protect claim, both customers worked directly with their local Maersk contacts, who had full transparency over their shipment and the incidents that had incurred. Our simple claims process enabled the customers to resolve their claims quicker and by providing less documentation, and despite being on the back of adverse incidents, both resulted in successful outcomes.
Last year, there was an incident on board the vessel, and we were looking at a two-week delay immediately. When working with fresh produce and perishables, we work on the clock and must get the product ASAP. Due to this initial delay, it was like a snowball effect because then we had delays in Panama, the port the ship was coming into, to go onto the Everglades; the shipment then missed that connection because of the initial delay and so on. We had no other way to handle or resolve this issue, so Value Protect it was. Since then, we have used Value Protect for other incidents.
We prefer to work directly with the South African office because it's a shorter turnaround time on answers than other lines. Maersk is by far the best for claims handling notification feedback, and since we've been using Value Protect, we've seen a quicker turnaround time on our claim settlements. Maersk will always consider and offer fair compensation, which is a significant benefit as we feel comfortable entrusting our cargo with Maersk. We don't claim unnecessarily, and you pay fairly when it's needed.
The Result
Maersk’s Value Protect has benefited both customers financially and by retaining their business relationships and for their future business. As both acknowledged, the product is only used when an incident occurs, and we know we cannot get away from these incidents, but with the measures we put in place, we work to prevent the most impact on the customer; that is what we strive for and are achieving. In addition to Value Protect, both customers use Captain Peter™, Maersk’s reefer visibility assistant, who provides complete transparency on reefer cargo throughout its journey with us. Using Captain Peter with Value Protect simplifies the shipment and claim process for the customer, as they can first check the data on Captain Peter's website to get insights before making a claim.
There's a huge benefit with having Value Protect because, in the past, we've worked with other lines that didn't have an extended liability product similar to Value Protect, or if they did, there just wasn't enough coverage. When making a claim, they didn't work with us to understand the nature of our business, so we lost a lot of money.
We use Captain Peter and Value Protect as the two major products, giving Maersk a competitive advantage in the market. These two products put you on a different level, and if we must choose between Maersk or another shipping line, we definitely will choose Maersk because we have more visibility of our shipments.
Are you ready to include Value Protect on your future shipments?
To ensure your business can also benefit from this extra protection and give you peace of mind in an unpredictable industry, enquire with your local sales or customer service representative today. You can add Value Protect to your contractual agreement or shipment when booking Maersk Spot online.
Find out more about Maersk Value Protect HERE
Find out more about Captain Peter HERE
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