Carrying high-value goods on the road: challenges and requirements
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As the risk of theft of cargo is ever-present whenever goods travel on the road, shippers and carriers have sought ways to either alleviate or completely eliminate the risk of goods, especially high-value ones, going missing. As e-commerce volumes continue to rise, and more high-end brand items are carried on the road, and the risk for shippers is continuously growing.
While high-value goods is a broad term, it can be narrowed down to branded fashion garments, ranging from designer sweaters and sneakers, cosmetics and perfumes, electronic devices such as phones, tablets, and computers, to pharmaceutical products. Such automotive parts as catalytic converters can also be considered as high-value goods. In general, road transport companies have inner policies in terms of what is considered a valuable shipment, defined as the total price of goods that are loaded onto a trailer and can range anywhere from a five-digit number to several million euros.
The reason why such goods are sought after is that they can easily be resold on either underground marketplaces or on classified ad websites. While phone makers, such as Apple, have put in safeguards to essentially disable the phones in case they go missing, they are still of interest to second-hand buyers for parts. For fashion manufacturers, there is little hope to control the second-hand market of stolen goods, thus controlling the process to prevent theft is the only option for some.
Thefts on the rise
One could have thought that due to a wave of restrictions and lockdowns across the world due to the situation with COVID-19, cargo thefts were on the rise.
According to the Transport Asset Protection Association (TAPA), a supply chain resilience and security association, there were more than €172 million of products stolen during the road transport process across Europe, the Middle East, and Africa (EMEA) in 2020. That means that on average, more than €471,000 worth of goods disappear when they are transported between loading and unloading sites. Surprisingly, as per TAPA, “74.6% of all incidents recorded by TAPA EMEA involved cargo thefts in the United Kingdom and Germany, with 3,100 and 1,727 crimes respectively over the 12-month period.”
Even then, the association believes that the reported crimes were “only a fraction of the losses.” TAPA highlighted that the “total loss for 2020 is based on only the 65.1% of reports to TAPA EMEA’s IIS which shared financial data.”
“2020 will go down in history as a year like no other. At a time when most businesses were focused almost entirely on a fight for survival, and law enforcement agencies faced the added pressure of policing new government lockdowns, traditional channels of cargo crime data were, as expected, also severely impacted,” remarked the President & CEO of TAPA EMEA Thorsten Neumann.
Per a Sensitech report, pharmaceutical products were not exempt from cargo theft. The company pointed out that the underreporting of the theft of such cargo was “a serious and prevalent problem.”
“Across the board, pharmaceutical manufacturer security personnel, risk managers, product security representatives, supply chain distribution specialists, insurance experts, and law enforcement, all agree that underreporting is a significant occurrence,” concluded Sensitech’s paper.
The European Commission (EC) appointed the Cross-border Research Association (CBRA) of Switzerland and TAPA to create a security toolkit for the road freight transport industry in Europe. In an abridged version of the document, the risk of cargo theft was by far highest whenever a truck was parked in an unsecured parking location. However, even driving the vehicle or loading and unloading posed risks to the security of the cargo, as the risk matrix showcased.
A shipper‘s homework
A shipper, or the one who is sending out his cargo, can lay the groundwork to ensure the safety of his cargo.
For example, the same EC report indicated that “the loading and unloading points are most risky for deception, meaning that a truck driver with a fake identity picks up a load from the consignor (and disappears with it), or a warehouse worker with a fake identity directs the truck to a fraudulent unloading point (and ultimately steals the cargo).” As a result, it is important to make sure that the carrier you hire to transport your high-value goods can pass your due diligence check.
If working with a logistics partner that outsources the road transport process, it is also important to make sure that they only dedicate the actual carriage of your cargo to a trusted operator that can provide adequate security to prevent the theft of high-value cargo. One of the ways to check whether a carrier has introduced sufficient measures is if they are a Good Distribution Practice (GDP)-certified road transport company, or have passed a TAPA audit. The scrutiny of a company by a third party ensures not only an independent inspection of a carrier but also showcases that they adhere to common standards, rather than a pot of atypical characteristics that logistics providers are judged upon. For instance, GDP standards are overlooked by the European Medicines Agency (EMA), a decentralized agency of the European Union (EU), and they include regulations about the transportation process of pharmaceuticals.
To ensure the safe transportation of high-value goods, shippers can also hire security companies to escort the cargo domestically, such as for shipments between two regions in Germany. However, international transportation of such goods adds additional complexity, as getting stuck at a border could result in a troublesome scenario.
Ensuring smooth deliveries
To ensure the efficient delivery of high-value cargo, carriers also have to make preparations.
In addition to acquiring such certificates as GDP or the TAPA TSR level 1, supplementing your road transport offering with additional safety measures will only make it easier for shippers to choose your services.
“Since Girteka Logistics has the status of a customs carrier, this helps us to ensure uninterrupted transportation of goods between the European Union and countries within the Eurasian Economic Union (EAEU). Essentially, the status provides us with such advantages as a prompt passage of the EAEU border, transportation of expensive goods without a long wait for an escort, no additional costs for escorting and also provides a financial guarantee,” says Zigmas Mikoliūnas, the Chief Operating Officer of the Russian Business Unit at Girteka Logistics.
“Transporting high-value goods is an important part of Girteka Logistics daily business activities, as we take great responsibility towards our customers. Listening to our customers allowed us to develop individual and effective solutions, improving our road transport services. We want to make sure that our customers’ cargo reaches its destination safely as whatever the industry, our customer always comes first,” comments Pavel Kveten, the Chief Operating Officer (COO) of Girteka Logistics European Business Unit.
According to Kveten, the fact that Girteka Logistics has a fully-owned fleet of trucks and trailers provides an advantage, as the company is able to have full control of the road transportation process. “We also strengthen the full control of our road transport services with our monitoring center, which immediately reacts to any kind of issues when goods are carried on the road, as the company also provides real-time visibility of a delivery. Since Girteka Logistics is a GDP-certified company and has a TAPA TSR Level 1 certificate we are able to safely carry high-value goods,” says the COO of the company’s European business unit.
“We are constantly improving and changing together with our customers’ needs and thus, sales and transport processes have been united under one umbrella, making our services more efficient, as well as allowing us to go the extra mile for our customers much easier,” notes Kveten.
Equipping TAPA safety locks on the road transport provider’s box trailers has helped to improve the safety KPI of the company, as together with other measures, the company-wide security KPI was 99.9% in 2019.
“Together with experienced professionals at Girteka Logistics, we cooperate with our clients who carry high-value goods by planning the route together, making sure that our drivers stop at secure parking locations and take the most optimal route to ensure a smooth delivery of their cargo,” concludes Kveten.