How dsm-firmenich Strategically Manages Its Ocean Freight Business
Optimizing process management and cutting inefficiencies with a control tower solution
Bringing two companies together required the dsm-firmenich logistics team to identify and leverage all strategic and technical synergies in a unified global supply chain. This case study illustrates how an innovative control tower solution, originally delivered to Royal DSM, and a full range of ocean contract management services provide significant benefits to the company today, including improved process efficiency, cost management, exception management, and full visibility.
Next-Level BCO With A Freight Forwarder
dsm-firmenich’s Challenge: A Changed Market and New Business Needs
Ten years ago, a transactional booking model for ocean freight was sufficient. But today, like many other companies, dsm-firmenich expects much more as the market has changed and so too have business needs.
In addition to negotiating its ocean freight rates directly with carriers – typically using a beneficial cargo owner (BCO) model for its Tier 1 locations – the company sought expert support from a freight forwarder to enhance execution of its standard operating procedures. Dave Coenen, Head of Network Strategy and Design, Global Logistics, dsm-firmenich explains “Booking agent was off the table! We wanted a strategic partnership!”
DHL Global Forwarding’s Solution: Ocean Contract Management (OCM)
DHL Global Forwarding collaborated closely with the company to develop the required Ocean Contract Management solution. This comprises access to a full suite of services – transport management, exception management, procurement services, allocation management, freight audit and pay, visibility and innovation, metrics and reporting, import and export, trade compliance, and customs brokerage – along with operation of a 24/7 data-driven Ocean Contract Management control tower.
The backbone of this solution is an enhanced operating system, supported by capabilities such as Smart ETA, allocation management, and a detention and demurrage tracking tool. These ensure exceptionally reliable data and state-of-the-art reporting.
Achieving Valuable Benefits
While this solution allows dsm-firmenich to continue negotiating ocean rates and capacity agreements directly with shipping lines, it also delivers the highest level of process automation, reducing manual work through electronic data exchange. Accessing a single data platform for all carriers, the company has detailed dashboard capabilities and analytics extending well beyond simply tracking physical locations.
Benefits for dsm-firmenich include optimized process management, which boosts efficiency and cost management; exception management, which helps identify and eliminate inefficiencies; and full physical and process visibility of the entire supply chain.
What dsm-firmenich Has to Say
There is no one-size-fits-all solution to ocean contract management. We realized it all starts with establishing strategy. In our case, with the BCO model, we wanted to have direct leverage and have control of the freights we procure, full transparency on what we’re paying for, and management services. With that we are in full control of our spend.
Bram Thuis, Procurement Lead, Global Logistics, dsm-firmenich
We were looking for a strategic partnership with a 4PL with the intention of jointly working together to achieve strategic KPIs. The relationship is foundational – it starts with a willingness to do business together and develops into valuable proactivity and shared goals.
Dave Coenen, Head of Network Strategy and Design, Global Logistics, dsm-firmenich
About dsm-firmenich
2023
Merger of Royal DSM & Firmenich
~30,000
TEU per annum
~8 million
KG per annum
~250,000
Outbound shipments per annum
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