What is the difference between SOC and COC? | BOXXPORT

What is the difference between SOC and COC? | BOXXPORT.com

The shipping container is universally hailed as one of the greatest inventions that completely transformed the way trade and businesses were done early, before the 1950s.

They have truly globalized the world and making the world a smaller place. In shipping industry, you may find people using terms SOC or/and COC elongated as Shipper Owned Containers and Carrier Owned Containers.

When we talk about SOC and COC, it’s mostly about owning rights. In this article, I will take you the proper definition of both terms and the advantages and disadvantages associated with them.

Generally, shipping containers are owned either by -Manufacturers -Traders -Carriers -Leasing Companies -Freight Forwarders, and -NVOCC What is SOC? SOC or Shipper Owned Containers are the containers that are solely owned by shippers. A shipper is a person who is entrusted with the responsibility of freight transportation and looks after the shipment until your goods reach the destination. But for a carrier, the shipper could be either direct a cargo owner, freight forwarder, or an NVOCC.

What is COC? When the containers are owned by the carrier itself, it is called COC or Carrier’s Owned Containers. A carrier can also be a VOCC (Vessel Operating Common Carrier).

A general question can hit your mind that..why would shipper have their own shipping boxes when carriers already have ample number of boxes. The answer could be summed up in a single sentence- Just like one would prefer to have his own home instead of living in a rented house and shift again and again.

Though a carrier has a plentiful of containers, they are either sold or leased to shippers for a specific time. And when you exceed the defined time frame, they levy charges called demurrage and detention which can exceed up to 20 times the original value of your freight.

Fearing this, shippers who are most of the time in need of shipment prefer to keep their own boxes called SOC containers instead of hiring from the third party (carrier).

For example- Few containers loaded with cargoes needs to be shipped in a remote location for mining work. Usually, in such remote areas, the receiver does not have a good storage space to store cargoes until the set-up of projects. The only option receiver would have to store goods will be to keep the containers loaded with goods until the completion of the project. Since the carrier provides a specific time frame under which he is liable to return the containers to the carrier’s port. Or else they will start charging extra charges called demurrage or detention with each passing day multiplying with the number of containers.

Demurrage amounts may differ based on terminal or carrier and often increase after an initial period of time. Daily demurrage charges can typically range from $75 to $150 per container per day, but that's just for the first 5 days or so.

Now imagine the total charge imposed on a shipper if he made a ten days delay to return if he had total 10 boxes. Fearing this, shippers who are most of the time in need of shipment prefer to own their own containers instead of hiring from the third party. In such cases, buying shipping containers comes to be more economical than paying a hefty amount to carriers.

Advantages of SOC: With Shippers Owned Containers, you save on demurrage and detention cost. It takes time for loading time, customs clearance, drayage, port congestion, etc. Since the container is your property, you are not obliged to return them as per the carrier’s fixed schedule. You can use it for a week, a month, or a year- with no liabilities.

Another attractive thing about SOC is that you can control supply. A SOC allows for control, flexibility, and independence. You wouldn’t need to take permission from your carrier.

Generally, for remote areas, carrier companies charge high rates. Since you are the owner

and you can use it for the shipment to any geo-location. You can source your box on your own.

Disadvantages of SOC: There are no such disadvantages of using SOC. The only thing you need to do is analyse your project and the number of containers required. Another thing you need to arrange beforehand is the storage space. Since a 20ft or 40ft shipping containers needs good space. You should have that space for storage.

Advantages of COC: COC container is the best way when goods can be unloaded or reload not far from the container terminal. It also comes to be beneficial when you are very much sure about how long you need the container. For the short term, COC is the best option.

Once the move has been completed, you do not have to bother about the container nor the storage space. After the delivery of freight, the box is returned to the carrier’s depot and you have no further obligations to comply with.

Disadvantages of COC: Using a COC means, that shippers can use it only for a limited period of time, called free-time. And if you hold container over free-time, you will have to pay demurrage and detention- which is its biggest disadvantage.

To save Demurrage and Detention is the key reason to use SOC containers. This also means you must put the time into finding the right partner for every step along with the transport.

At BOXXPORT, one can easily avoid demurrage and detention charges-by buying SOC Containers online. The use of SOC equipment helps you to save these costs. You can just sell the container on BOXXPORT.com after your cargo has been unloaded from it.

During this tough time of COVID-19 imbalance of containers is a major concern amongst freight forwarders, shippers, etc. A huge number of shipping boxes are stuck around the world. There isn’t enough container to keep world trade moving. This is leading to a shortage of COC boxes. All this speaks why you should buy SOC Containers. Readout our other article which talks in detail with facts and figures that why having SOC Containers can keep your freight moving regardless of the situation right now.