Inatech launches its Optimizer to add smart decision making for fuel purchasing to its cloud-based management solution for the entire fuel procurement process.
The company explains that Optimizer helps ship operators take the guesswork out of their fuel purchasing decisions by providing real-time guidance on the three key factors of quantity, location and price strategy-how much fuel to buy for each ship in their fleet, the best port to bunker at and the right price strategy (spot versus contract).
In ongoing proof of concept evaluations for large shipping companies, Inatech's Optimizer has been shown to deliver real-world fuel cost savings of up to five percent. With an average shipping company spending around $400 million a year on bunkering that saving could add some $8million to their bottom line.
How Optimizer saves fuel procurement costs – a typical scenario
The value of Optimizer is best shown in a typical scenario of a vessel that burns 75 tons of fuel a day for around 270 days each year. At $625 per ton, the ship's operator will spend approximately $12.7 million a year on fuel.
A shipping company utilising Inatech's ShipTECH fuel procurement solution can already achieve savings through streamlined procurement. This is made possible firstly through a systematic workflow that avoids last minute purchases, secondly supports negotiations through an in-built "best buy" process and finally ensures accuracy of both quality and quantity of fuel through integrated operations and claims handling.
ShipTECH also has advanced dashboard reporting built in which delivers immediate decision support. With specific dashboards for Strategic, Tactical and Operational decisions - ShipTECH dashboards convert data into action-oriented knowledge.
Optimizer now takes this process to the next level to offer savings of an additional 2–5 percent. This is because Optimizer adds a smart layer of business "predictive intelligence" (source - Gartner Evolution of BI, 2012) that makes accurate recommendations for the exact amount of fuel to purchase as well as taking into consideration port arbitrage factors relating to both fuel availability and price trends - this is a crucial aspect of the cost saving process due to the widespread variation of fuel prices (often $40 per ton or even more) both from port to port and within ports.
Companies can achieve the higher limit of savings by adopting business process changes across their bunkering, operation and supplier organisations. Inatech finds that C-suite support is central to ensure that the entire fuel ecosystem embraces the fuel procurement strategy.
Ultimately, the overall saving on the fuel bill can range from 2-5 percent, which translates to savings of between $250k – $630k per vessel per year. This contributes directly to vessel yield and in the tough shipping market helps deliver the competitive edge that CEOs are seeking.
"Ship operators are coming under ever increasing pressure to minimize their fuel costs, hence the trend towards measures such as slow-steaming. With Optimizer, Inatech now offers a smart solution to achieve very significant fuel cost savings that could make the crucial difference between running at a loss and profitability", says Jean-Herve Jenn, CEO of Inatech.