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INSIGHTS

FUEL IS STILL AMONG THE BIGGEST COSTS, AND

POST-2020 IT COULD BECOME AN EVEN LARGER COM-

PONENT. INATECH’S ROLE IS TO WORK WITH OPERA-

TORS AND TO PROVIDE PRODUCTS THAT HELP THEM

DEVELOP A STRATEGY FOCUSED ON EFFICIENTLY

MANAGING FUEL PROCUREMENT AND THE RELATED

EXPENSES AS EFFECTIVELY AS POSSIBLE. – Alok Sharma, Head of Global Sales at

Glencore’s Inatech

Bunker companies need to ensure the ship operator is credit worthy and also benchmark the potential risk of do- ing business with many parties. Tell us about how Bun- kertech ETRM can help manage this task.

Credit risk/credit-worthiness is a big concern for suppliers, who have to carry the burden of cost right through the supply chain. With margins tight, the cost and availability of credit, and the credit-worthiness of customers can both have a signif- cant impact on business. When it comes to managing credit

What do you see as Inatech’s role in meeting the needs of risk, it is important for suppliers to have in place robust fnan- vessel owners in a post-2020 world? cial management processes and systems. Bunkertech ETRM

To a large extent, our role will not change in a post 2020 world. offers bunker suppliers the specialist credit management func-

The main purpose of our products are to help ship operators, tionality needed to give them a way to effciently process in- bunker suppliers and physical oil traders use technology to in- voices, handle credit terms, produce cash fow forecasts and tegrate, automate and streamline processes in order to drive in- manage costs. Suppliers can combine these activities with due creased effciency, reduce costs and achieve improved margins. diligence and credit-worthiness checks of potential customers.

For vessel owners there are two choices – increase revenues or reduce costs. In today’s competitive markets boosting revenue The OW debacle certainly impacted world shipping, roiled growth is going to be a challenge and I can’t see that changing bunker markets, changed how people can get credit and, fast. So, the only variable ship owners can truly control is costs. just as importantly, changed the risk models for the bun-

Fuel is still among the biggest costs, and post-2020 it could be- ker market and its stakeholders. How so and were there come an even larger component. Inatech’s role is to work with positive outfalls from OW?

operators and to provide products that help them develop a No one saw OW coming. It happened to a large company, strategy focused on effciently managing fuel procurement and and the assumption was that such organizations were immune the related expenses as effectively as possible. That includes to bankruptcy. Remember, OW controlled around 7 percent helping management become more aware of the added com- of the global $150bn bunker business and only seven months plexity that new regulations add to the bunker buying function. earlier had undergone an IPO. It has affected the insurers’ and

Technology combined with embedded best industry practices banks’ assessment of the industry, with bunker suppliers now and decision-making systems is the fastest and most effective struggling to secure credit capacity. I believe it is something way of delivering savings. This is our role now and I expect it to that cannot be prevented from happening again.

continue well beyond 2020. Inatech works across three industry This also represents an opportunity for the industry to reas- sectors – shipping, bunkering and physical oil trading. Shipping sess how it operates. For ship operators, it’s a chance to re- faces an unpredictable future: volatile fuel prices, variable fuel evaluate the entire fuel procurement process, and counterparty quality, issues around fuel delivery, the diffculty in obtaining risk (for the frst time). For physical suppliers, it’s a chance to credit and the threat of increased regulations. recognize that too much of their exposure was tied to too few 28 Maritime Logistics Professional July/August 2017 | |