Auditel Consultant:
Simon Beechinor

Beware the Jabberwock or “double dip” to you…

08 Mar 2010 | Filed under: Cost management

Following on from my comments about using the logistics sector as a crystal ball to gauge the state of the wider economy, I’m delighted that there is some, arguably, good news around. I see from Lloyd’s List today that a new container sector analyst’s report suggests the deterioration in container market conditions has “clearly stopped” despite a weak finish to 2009, although “macroeconomic variables” continue to send mixed signals about demand.

In the author’s words “The whole industry is out of intensive care but will have to remain on the observation ward for a while,” don’t ring the church bells yet. For as long as 10% of slot capacity is laid up and new tonnage is still to be deployed there is a vast latent over-capacity. Bunker prices are still sky high and vessels are slow steaming all over the place – it’s a ghastly picture. Our advice to all businesses is to really screw down the lid on costs now while there’s time, as a “double dip” could be just around the corner. You might not have a vorpal sword to slay your demons but cost management is in your hands.