The Power of Simplicity

A Man on the Moon When John F. Kennedy became president in January 1961, Americans had the perception that the United States was losing the Space Race with the Soviet Union, which had successfully launched the first artificial satellite, Sputnik, almost four years earlier. The perception deepened when in April 1961, Russian cosmonaut Yuri Gagarin […]

Why Do Freight Rates Change So Often?

In the previous post “Pricing Challenge for Container Shipping” we mentioned that it’s not an easy task to manage freight rates. This is because the transportation costs consist of up to 25 various charges, and shipping companies have to put up with enormous rate volatility – up to 50 rate revisions per year. Looking at the whole transportation process, it […]

Pareto Principle in Container Shipping

Over 100 years ago, Italian economist and sociologist Vilfredo Pareto noticed a few recurring distribution patterns, which led him to discover that 80% of results come from 20% of causes. This phenomenon was called the Pareto Principle or the ’80/20 Rule’. The 80/20 distribution patterns are so universal, that they apply practically everywhere, for example: […]