Napier Port: New logistics service proves power of collaboration

The Napier Port Logistics Service is a new collaborative business offering for Napier Port. Tell us about the service and your role as Supply Chain Network Manager.

Napier Port is the shipping gateway connecting the centre of New Zealand with the people and markets of the world. In 2021, we strengthened our customers’ connection with their markets with the launch of the Napier Port Logistics Service.

The starting point for the new logistics service was optimising container movements for importers and exporters throughout the central and lower North Island. To make this happen, we collaborated with importers and exporters, road and rail services, Manawatū Inland Port and third-party coolstore providers.

Managing an end-to-end supply chain with multiple stakeholders (including warehousing, container packing, transport and our port) can be complicated and an inefficient use of customers’ time. Our ‘site to sea’ logistics service solves that problem.

My role has been to establish the logistics service, build the team, develop end-to-end solutions for customers and co-ordinate landside transport options with customer demand and shipping schedules.

Why did Napier Port establish a logistics service?

We could see waste in the landside supply chain. Trucks and rail wagons would haul cargo to or from Napier Port but be empty on their return journey. As we can see all the containerised imports and exports before a vessel arrives in Napier, we can optimise the landside network on a large scale. As well as providing a freight solution for our customers, we are removing waste from the supply chain and reducing New Zealand’s carbon footprint.

Port congestion in the upper North Island means out-of-region customers dealing with shipping delays are using the logistics service to move cargo through Napier Port. Cargo berthed in Napier can be quickly dispatched to other regions in New Zealand with a shorter supply chain lead-time and lower total cost than importing through the closest port.

How’s the logistics service going?

The logistics service runs five days a week and includes rail services between Napier Port and Manawatū Inland Port in Longburn, near Palmerston North. Utilisation of the landside transport offering is steadily climbing, with an even mix of export and import customers.

Manawatū Inland Port is used by our shipping line customers, Maersk, Hamburg Sud, MSC and CMA. It offers flexibility to cargo customers by providing a local option for on-hiring and off-hiring containers. About 70 percent of our container movements have a link to the inland port, demonstrating the value of a service offering that takes waste out of the supply chain.

Why is collaboration important when setting up a new business offering?

Working closely with rail and road transport operators is essential to optimising a logistics service. Some supply-chain roles, for example, in the e-commerce space, depend heavily on the quality of their technology. While our logistics service uses data and technology to optimise use of the transport network and to operate the service, the main driver of our success comes down to the quality of the relationships with the people we do business with. This includes how well we understand our customers’ needs and ways of working and our simple interface for managing their requirements.

Creating situations where everyone benefits is the best way to work together. It’s not always easy to bring together competing objectives. When value is created for all parties, it’s much easier to get agreement.

How did you unlock and distribute value between the parties?

Being open and transparent is key, including being open to sharing value created between all the parties involved. We had to think of the value for every stakeholder in the collaboration. That value had to be real for them, from their perspective. Value doesn’t always need to be financial. It might instead be strategic impact, positioning, sustainability, collaborating with customers, or growing business reach.

My job has been to be a gentle driver of the process. We understand that people have different priorities and are working to different timelines. It’s up to us to understand our customers’ supply chains and to demonstrate how our logistics service adds value to them.

What are some of the challenges you’ve faced?

Each party has their own timeline for their part of the logistics service, so working together to bring differing schedules in line is an ongoing challenge. To bring people along with you, take the time to understand how they operate and what part they are willing to play. Building a relationship with and understanding the motivations of people at all levels of the business is important, so you can build a solution that respects the constraints brought by other parties.

Mindset is everything. Relationship-based roles need people skills and an open mind to test new ways of working. Selecting the right people to develop a collaborative solution is critical. Yes, technical skills are important, but personal attributes will make or break a collaboration.

Lastly, think creatively. The solution might look nothing like what you originally had in mind.

What have you learned from setting up the Napier Port Logistics Service?

Lots! Here are a few key learnings:

• The support of the customer (cargo owner in our case) is the foundation to achieving an effective supply chain. Knowing that a customer is ready to use your service really focuses the mind of everyone involved.
• Don’t underestimate the value of face-to-face meetings (when you can have them!). Spending time with key customers allows you to understand the way they operate.
• Respect other parties’ timing. 
• Plan for the long-term outcome, not a short-term win.
• Value is not always financial.
• Bring your solutions to the table.
• Connections are vital. Build on your existing relationships and don’t be afraid to use your wider network.
• It’s crucial to build flexibility into a logistics service, especially in this time of international supply chain disruption. If a ship misses its call and cargo doesn’t arrive in port as planned, the delay flows through to all other aspects of the logistics offering.

How would you advise other companies think about collaboration?

Think about the value being created for every stakeholder. If you can create value for all, it’ll work. If it’s a one-sided arrangement, it won’t. And don’t be afraid to invest in your relationships - they are the foundation of a successful collaboration.