Block train? Next station, Europe
Published by Sam Cage on 21 September 2018
Block train services are winning new business with Maersk customers, showing the benefits of brands working together to provide more comprehensive and flexible solutions.
In November, a block train arrived in France full of sporting goods from China for retailer Decathlon’s stores. Now, just a few months and several block trains later, Damco’s rail team has won new business with clothing retailer H&M, and is doubling A.P. Moller - Maersk block train volumes. Photo: Jesper Schwartz
It started with a single train.
In November, a block train – booked by a single customer and shipped from the same origin to the same destination without being split up or stored en route – arrived in France, full of sporting goods from China for the retailer Decathlon.
Now, just a few months and several Decathlon block trains later, the rail team has won new business with clothing retailer H&M, doubling A.P. Moller - Maersk’s block train volumes. This comes on the back of additional wins within the chemicals, fast-moving consumer goods (FMCG) and lifestyle sectors, with customers including Syngenta, Wyeth, Testrut and Levi’s.
The ultimate aim for the team is to run a weekly block train service with Maersk Line containers between China and Europe. In this scenario, customers would buy space on Maersk’s trains individually. This in turn would bring them even more flexibility.
“With the block train, we have identified and defined a service that is in genuine demand by our customers. As we – Damco and Maersk Line – are working together more frequently on rail, we are now beginning to see real results in the market with current and potential customers. These results are also creating a positive appetite for rail throughout the organisation,” says Kasper Krog, Global Head of Rail for Damco.
Damco CEO Klaus Rud Sejling also sees the success of the close working partnership with Maersk Line and the block train service so far as critical to taking rail to the next level, particularly in terms of commercial efforts.
“To make good on our ambition, we will need to sharpen our focus on winning over more customers and to strengthening people’s understanding around the benefits of block train,” says Rud Sejling. “Clearly, we have the experts and expertise in this field, so I’m confident we can look forward to bringing tangible results to more businesses with rail.”
The block train service is an example of how collaboration across the A.P. Moller - Maersk businesses is benefiting both customers and the operator company.
“Rail is an increasingly important option for our customers, so it’s great that we’re able to cooperate to meet their needs,” says Lee Sissons, Maersk Line’s Head of Trade and Marketing in Greater China Cluster. “We can see clearly that our customers are asking for rail in addition to their ocean freight business, so it is in our interests as a group to offer both. Maersk Line and Damco are benefiting from this cooperation, which also emphasises our approach to developing new ways of supporting our customers’ businesses.”
The service gives customers more flexibility in their supply chains. As the entire train is dedicated to a single customer, the containers do not have to be transported from a distant port or railhead to the warehouse.
“Moving from where we are today to establishing a weekly block train service is definitely an ambitious goal. But we have a great team of experts who have spent years getting the service to where it is,” says Kasper Krog.
“We have listened to the customer, watched the market and become smart at the way in which we market ourselves. It’s a fantastic rail journey, and we’re all looking forward to reaching the final destination.”
Multiple advantages for businesses
- The 10,000 km block train service from China to Europe offers multiple advantages for businesses. In addition to saving some 21 days of transport time, the service also brings tangible financial, operational and environmental benefits.
- Aside from costing less than air freight, the block train is substantially faster than sea freight. This means businesses can expand and mix multi-modal options according to their needs.
- With sustainability becoming an increasingly important consideration for many businesses, the comparatively lower carbon emissions that rail offers can be attractive for firms with sustainability targets to meet. Rounding off the service is the minute-by-minute visibility that we can deliver to businesses via GPS tracking and daily reports on the cargo.