In the shipping world, containers are constantly moving between ports, warehouses, and distribution centers. People involved in shipping tend to focus on what happens when moving containers. However, an area that often gets overlooked is what happens in empty container return (CER).
At first, the container return process might sound simple, but returning a container is a highly time-sensitive process. Doing the process efficiently is essential as it helps streamline the supply chain and eliminates extra costs.
In this article, we’ll look at how to return the empty container, what the challenges involved are, and the best practices. Let’s get started!
Understanding What Empty Container Return Is
This process refers to sending a container back to a specified location after the goods in it have been unloaded. The location where the container is returned to can be a port terminal, a container yard, or an inland port. One of the primary reasons for returning an empty container is to get it back into circulation for future shipments.
These containers are highly valuable to carriers, and their availability impacts how efficiently cargo can be moved. Therefore, having the right containers at the right time is critical for streamlined supply chain operations. When it comes to container return, the responsibility typically falls on those who took the containers, the consignee, or the third-party logistics provider.
Apart from that, truckers also play a role in how these containers are transported to their initial location. To return the empty container sounds like a routine and straightforward task, but without proper handling, delays can occur, which lead to additional cost alongside supply chain challenges.
As far as avoiding these challenges is concerned, having an understanding of the entire container life cycle is necessary.
The Shipping Container Life Cycle
Most businesses don’t own the shipping containers themselves; instead, they rent a container from shipping lines. We mainly discuss this type of container instead of SOC.
When it comes to the entire shipping container cycle, you should understand that one container goes through several key stages from the moment it’s packed with goods to the moment it’s ready to be used again.
In the first stage, an empty container is fetched from the shipping lines to the place where goods are stored. This place may be a shipping facility or a warehouse, where the container is loaded with appropriate goods.
After that, the container is moved to a port, loaded onto a vessel, and shipped to the specified destination.
During stage three of the process, the container arrives at the receiver’s facility, and from here onwards, the cargo is unloaded and sent to the end consumer. At this point, the container has entered stage four.
This stage is the empty container return process, where it has to be sent to a predetermined location. Common examples of such locations can be a shipping container yard, port terminal, or depot. As far as returning containers are concerned, it’s more than clearing space. The entire return process is for the effective functioning of future operations.
It’s possible for the empty container stored at the facility to be loaded with goods and be used again. However, when certain regions import more than they export, a surplus of empty containers can occur, and if that surplus is not managed properly, it can negatively impact the entire supply chain.
Empty Container Return – Where And How It’s Done?
Once a shipping container is empty, it must be returned to a designated location that’s determined by the shipping line. These locations vary depending on the carrier’s location and the local infrastructure as well. As for the process, it starts with getting confirmation on the return location.
The return location is often not the same as the pickup point. Carriers may also change return locations based on the capacity and congestion. In cases where the return location is a facility with high inflow and outflow, an empty container return slot has to be scheduled before dispatch.
In addition, there are various types of documentation that are required before a container can be returned. The paperwork may include a delivery order, container return authorization, and any other documentation deemed necessary by the carrier or the port. During the container return delivery, the shipper must ensure that the container is damage-free. If you work with a freight forwarder, they will manage the container return.
The entire process overall requires clear communication between different parties, like consignees, carriers, freight forwarders, or truckers, to ensure the container is returned properly and on time.
Why Is Timely Container Return Important?
When it comes to returning empty containers, it’s about keeping the entire supply chain running smoothly and avoiding any additional costs. For example, there are specific timelines for an empty container return, and a violation of that timeline can lead to detention fees. Detention charges occur when the container is kept outside the port for more than the predetermined time limit. While these fees may seem like minor costs, these minor costs can add up rather quickly.
Apart from financial penalties, delays in container returns can also cause major operational issues. Both ports and terminals have a limited number of spaces, and when container returns are not done promptly, it can lead to congestion that decreases the efficiency of shipping and the supply chain.
A delay in clearing out empty containers, for carriers, means that a lower number of containers are available for the next shipment. For receivers, it means that the number of spaces available is low, which can influence the overall flow of goods. So, overall, an on-time container return process is essential.
Common Challenges Faced In Returning Empty Containers
The process might seem straightforward, but it comes with different logistical hurdles that companies must be aware of. Some of these challenges include:
In some cases, depots and terminals can become packed and left with no room for containers returned, leaving shippers and carriers looking for a prompt solution, one that may not be available at all times.
Limited equipment or the limited availability of the equipment can also delay the return process and cause efficiency problems throughout the supply chain. An example is the empty container handler, which is a specialized piece of heavy equipment used to lift, move, and stack empty shipping containers.
Last-minute changes are another common type of challenge. These changes can lead to wasted transportation initiatives and increased costs.
A shortage of available trailers or drivers can make it difficult to return empty containers on time, often leading to higher transportation costs and late return penalties.
Best Practices for Managing Empty Containers
Now that you’re aware of the challenges for empty container operations, let’s look at some of the best practices that can help ensure timely container returns. These include:
Confirming Return Location – This is one of the most overlooked practices that many don’t follow since they assume that an empty container return location will be provided to them. However, in case it’s not, companies should get confirmation for it as soon as possible.
Tracking and Your Container’s Free Time – If you know when the clock starts ticking, you have a better chance of making sure containers are returned timely and that any penalties can be avoided.
Finding Reliable Partners – Working with freight partners who are familiar with local ports and procedures can be beneficial, as they are better equipped to adjust to change when needed.
Maintaining Documentation – Keeping all the paperwork, such as delivery details or receipts, can help streamline verification and acceptance.
Final Thoughts
An empty container return is a process that first-time shippers might overlook. This process seems straightforward at first, but it does come with various challenges, such as last-minute changes, limited slots, and fleet shortage.
Luckily, with prompt planning and management, these challenges can be tackled with ease, so the supply chain functions as efficiently as possible.
Frequently Asked Questions (FAQs)
What happens if I miss the empty container return deadline?
Container return deadlines should be adhered to ensure optimal functioning of the supply chain. Missing the deadline can lead to penalties.
Can I return an empty container to a different location?
Generally, there is a predetermined location to which empty containers are returned. Returning one to an unapproved location leads to delays and additional costs. While the empty container return location can change, it must be approved by all parties involved.
