Arctic express: a marketplace offering food for crews is now available in the Far North ports
Murmansk based company Union Service has launched Russia’s first ship chandler services on express supply of products for crews of ships. Marketplace Unimarine.store operating from the end of 2021 offers a simplified delivery of products to the ports of Russia’s Far North. The company estimates its market in Russia at about RUB 30 billion per year with a potential growth to be driven by the increased cargo flow in the Arctic by 2024. However, slow satellite internet connection hinders the development of ship supply technologies.
Before 2021, Union Service established in 2014 by Aleksandr Krasov, Vasily Shaitanov and Maksim Belov was mainly engaged in organizing rotation for foreign crews in remote Arctic areas and supplying non-food cargo, equipment, materials and spare parts to shipping companies.
It also used to have some customized orders. According to Maksim Belov, co-founder of the company, the clients occasionally ordered food delivery. It was normally arranged through a long exchange of e-mails that made the supply process slow, he says. Hence the idea of establishing a Unimarine.store platform — online store of products for ships.
It took about 9 months to develop the platform and the company started with the first test orders in early autumn 2021. The first clients of the service were — Boskalis, Deme Group, GAC Marine, GAC Shipping and Logistics.
The point of the service is to ensure a single window format — the website’s storefront displays all the products available at the selected port, with photos and descriptions in Russian and in English. Foreign crews can encounter misunderstanding of local product items, additional explanations are needed sometimes. “Our favorite example is Lyubyatovo flakes. How can foreign crewmembers know what it means? They normally had to guess what products were listed in the table before ordering food”, Union Service explains.
According to the company representative, several million rubles was invested in development of the website and its CRM system, improvement of the search system and introduction of artificial intelligence. Union Service has no storage or production facilities but it has a well organized logistics of cooperation with its partners. Products are delivered by both federal retailers and local food stores. So far, Unimarine.store deals only with food products but sees a demand for household goods as well.
Union Service estimates the market of food supplies to ships at RUB 29.6 billion per year taking into account the calls of foreign ships to Russian ports.
According to SPARK-Interfax, revenues of Union Service in 2020 rose almost 2.5 times to RUB 258.9 million, net profit — almost 6.6 times to RUB 12.2 million.
Supplying of ships in its traditional way is a very long process, tells Konstantin Fokin, Unimarine.store Project Manager. Selection of products by crews and coordination of delivery can take up to several days not including the delivery itself: at first, a crew provides a list of products to its ship agent who sends requests to intermediaries and ship chandlers for spreadsheets in Excel format. Then goods are chosen and a ship chandler has their availability and prices confirmed since they can change during the time needed for approval. Then final cost including logistics is sent to a client for approval.
Within the marketplace, information about products is updated online, all products available in the selected port can be ordered. Product selection is automated through involvement of the artificial intelligence: a computer assembles a basket of goods taking them from the base.
“Phase-by-phase exclusion of humans from assembling a basket of goods considerably reduces labour input and accelerates the supply rates”, say the service developers.
Thus, ordering time has been reduced to one hour. Taking into account logistics in Murmansk and Arkhangelsk, it takes one day to deliver products to the port. As for Sabetta, a closed rotational settlement, minimal time of delivery has been cut to 72 hours, say the specialists. Online orders are also accepted for deliveries to other points, such as the ports in the Gulf of Ob, Yamburg and Utrenny.
“The service offered via Unimarine.store has been in demand for a long time. Shifting of ships supplies to the digital space lets considerably facilitate the process from orders to deliveries on board the ships and make it as transparent as possible for a customer. It is especially vital for the Far North ports where any similar task is a challenge”, emphasizes Andrey Dmyanyuk, Commercial Director, GAC Russia (works with Union Service under partnership agreement).
Maxim Belov says the website is available via satellite Internet connection. Therefore, crews can send orders from the sea and have the ordered goods delivered to the port by the time of arrival. Ship owners can conduct operational control of crews’ orders via their personal accounts on the website.
Average weight of one order is about 300 kg (20 crewmembers for 12 days). Frozen meet, fresh vegetables and fruit are often ordered in the beginning of voyages while sweets and soft drinks are normally added in the end of voyages.
Given the target of 80 million tonnes set for cargo traffic on the Northern Sea Route by 2024, the number of calls in the Arctic will almost triple, expects Union Service. The company says this dynamics will entail the need for acceleration of servicing in ports.
In 2022, Union Service is going to launch its service in one of the country’s largest ports, Great Port of Saint-Petersburg. However, further developments are hindered by the absence of high quality connection: the speed of satellite Internet in the Barents and Kara seas is only 0.5 Mb/s. If the situation does not improve, it will be difficult to introduce advanced technologies for servicing ships, says the company.
By Sophia Vinarova
More industry-related content is available on our social media pages: FaceBook, YouTube, Telegram, Twitter, Yandex Zen