The New “BAF” Program | Accurate & Transparent Marine Fuel Management with Breakthrough
March 7, 2019
Since our inception in 2004, Breakthrough has been the pioneer in helping shippers accurately manage their transportation energy spend. What started in North American over-the-road fuel management has now expanded to an array of transportation landscapes—as shippers recognize the value of managing fuel across varying modes of transportation.
With new international maritime (IMO) regulations set to take effect in 2020, the industry is fundamentally changing, making the maritime shipping industry one of the most critical landscapes to manage fuel. Sentiment in the industry convenes over these two salient facts—that the market will remain volatile in 2019, and that both shippers and carriers need more accurate and transparent fuel management solutions.
Solution: Marine Fuel Management With Breakthrough
Overcoming these distortions in your maritime strategy is possible with Breakthrough Marine Fuel Management. Our robust and data-driven program aligns with Breakthrough’s core principles of achieving transparency, removing distortion, and establishing fairness in our clients’ supply chains. Here’s how we unlock this value:
To understand the underlying costs associated with your ocean freight movements, Breakthrough will work with your organization to uncover the realities of your current BAF programs. We analyze your data to isolate distortion and inefficiency, forming our recommendations based on your network realities.
Once you gain visibility into your marine fuel cost dynamics, Breakthrough then develops a consumption-based fuel reimbursement strategy with you, accounting for the necessary geographical, fuel, and regulatory considerations. Throughout this process we move shippers from a quarterly BAF program toward a market-based program that accounts for accurate and timely fuel prices.
The resulting marine fuel management program can then be used to replace existing BAF programs with a market-based strategy that is fair and accurate for both you and your carriers. By removing price risk premiums and avoiding unnecessary emergency surcharges, a more competitive landscape is created for both parties, allowing carriers to focus less on fuel and more on the service they are providing.
With drastic regulatory changes on the horizon, and a host of different strategies that carriers will use to adapt to them, fuel will remain a significant portion of shippers’ marine spend for the foreseeable future. As complexity in the marine landscape grows, shippers who implement a program that allows them to clearly see and evaluate their fuel spend will have a competitive advantage in the marketplace.
To learn more about how Breakthrough Marine Fuel Management provides unmatched value to shippers operating on the high seas, please visit our solutions page.