Over the last few years, the Partnership for Supply Chain Management (PFSCM), a nonprofit procurement agent and 4PL services provider, has improved transport planning and strengthened its collaboration with 3PLs, customs clearance agents, and in-country clients to collaboratively and systematically address supply chain complexities that increase the risk of delays and charges therefor.
Any mode of transport can incur delay-based charges or extra costs due to wastage, expiry, or loss. If air shipments are delayed at destination airports, storage fees may be incurred, while detention and demurrage (D&D) charges apply to delayed ocean freight at seaports.
D&D charges are penalties shipping lines and port authorities impose when containers are not moved within a specified timeframe. While both charges relate to container movement delays, they apply at different supply chain stages.
Demurrage charges are incurred when cargo remains at the port beyond the allotted free time after arrival. The charges accrue daily until the container is cleared and moved from the terminal.
Detention charges are levied when containers are held outside the port beyond the free period for unpacking or returning empty containers to the shipping line.
Storage fees and D&D charges are all considered delay-based costs and can escalate quickly. They increase the cost of shipping health products and strain limited budgets in low—and middle-income countries (LMICs).
Through proactive supply chain management, stakeholders can manage the risks that commonly drive delay-based charges.
Between 2022 and 2023, PFSCM achieved a 24% overall reduction in delay-based charges and a 9% overall reduction between 2023 and 2024. The most significant decrease was in Nigeria, followed by Uganda, Cameroon, Tanzania, and Côte d’Ivoire.
Delay-based charges arise due to various factors, many of which are particularly prevalent in LMIC settings. These include importation documentation errors, waiver approval times, customs clearance delays, dependence on limited human resources and infrastructure, restricted coordination among stakeholders, port congestion, logistical bottlenecks, and other supply chain disruptions caused by climate and/or socio-political events.
With 20 years of experience overseeing health supply chains in LMICs, PFSCM is adept at dealing with the above challenges and has undertaken several initiatives to address them systematically.
A view from the 4PL Director’s seat
PFSCM 4PL Services Director Ishmael Muchemenyi, overseeing PFSCM’s logistics and 4PL operations for more than 10 years, explains some of the unique areas of expertise and practices in which PFSCM has excelled.
He says that, where feasible, PFSCM uses emergency removal facilities in applicable countries, preclearance where possible, encourages blanket waivers, and issues pro-forma invoices so consignees can start applying for waivers early in the process.
Further, he explains that PFSCM maintains country-specific shipping instructions and importation process maps that clearly outline roles, responsibilities, and timelines in the end-to-end process.
“Throughout our long organizational history, we have delivered products to more than 100 countries and we have come to understand the intricacies and nuances of various importation processes, and have in some cases even helped countries to grasp their processes better; one such example being Tanzania that some years ago experienced an abrupt regulatory change that resulted in delays in customs clearance.”
He adds that PFSCM advises on specific days and times to avoid—such as weekends for cold chain deliveries and “red zone” periods during holidays or stocktaking—when warehouses are closed for regular inbound and outbound operations.
Meanwhile, Muchemenyi stresses that as a standard procedure, no product is shipped without the required tax waiver documents and warehouse approval, and each shipment is pre-alerted with the expected delivery dates proactively communicated.
In conclusion, he says that pre-planning, document accuracy, special packaging, and regulatory compliance are critical in avoiding long customs delays resulting from customs disputes and fines.
Other systematic PFSCM supply chain interventions that reduce delay-based costs
Leveraging product information early for load optimization
PFSCM is undergoing a digital transformation. As part of the initiatives to digitize and automate key processes for improved visibility, we streamline product data management activities by using a product information management (PIM) system at the start of our portion of the supply chain.
Our product portfolio includes more than 6,000 unique stock-keeping units comprising various ambient, temperature-controlled, cold chain, and frozen products of all dimensions. These thousands of products all have unique attributes that, among other factors, indicate how to pack and transport them cost-effectively and safely.
This vast amount of product information is maintained in our PIM tool to ensure accuracy, completeness, and timeliness. Our logistics teams leverage product and order data to automatically identify high-volume, high-freight cost orders for load optimization or packing review. The process also considers clients’ special packing requirements, for example, what kind of pallets they prefer using, the product classification, and the container type used.
The review process often reveals opportunities to amend product, pallet, or container packing configurations for improved use of valuable space and to avoid double handling where products require repalletization at the destination.
If a compelling opportunity for improved loading is identified, we engage the appropriate stakeholders and collaborate closely to implement the best load optimization solution. Working with stakeholders, an optimization solution may entail a change as simple as stacking pallets differently to more complex initiatives like pursuing entirely different product packaging.
Load optimization solutions help us pack and load products optimally to reduce the number of containers needed. Fewer containers can be cleared faster, and transported and offloaded at warehouses more efficiently, reducing the overall risk of delays that may result in additional charges.
Load optimization ensures cartons, pallets, and shipping containers are packed optimally while still meeting clients’ receiving and warehousing requirements. Optimal packing means cartons, pallets, and containers are loaded in configurations that use the packing area entirely or with the least amount of unused space. This minimizes the number of containers needed, reduces shipping costs, and lowers the logistics carbon footprint.
Skilled logisticians with country-specific experience
PFSCM employs a large group of experienced logisticians, many of whom have worked at private and humanitarian freight forwarding companies before. The more than 30-person-strong team combines logistics and 4PL specialists who collaborate to coordinate the strategic movement of health products.
The planning activities include load and route optimization, mode selection (road, rail, air, or sea), carrier management, cost control and freight budgeting, and regulation compliance. The teams combine niche expertise and leverage technology, such as PFSCM’s One Network Control Tower and PIM tool, to analyze data, track shipments, and make informed decisions that improve service levels and operational resilience.
In addition to their technical expertise and advanced tools, our logisticians rely on diverse critical skills. Strong analytical abilities enable them to interpret complex data, optimize routes, and forecast demand accurately. Effective communication and negotiation skills are essential for coordinating with suppliers, 3PL, and stakeholders, ensuring seamless operations.
Adaptability and problem-solving capabilities allow them to respond swiftly to unforeseen challenges, maintaining supply chain continuity. Proficiency in project management ensures that logistics initiatives align with organizational goals and timelines.
Moreover, a deep understanding of regulatory compliance and risk management is crucial for navigating the complexities of humanitarian logistics. These combined skills empower PFSCM’s logistics team to actively address the underlying supply chain inefficiencies that drive delay-based charges.
Strong partnerships with expert 3PLs and customs clearing agents
PFSCM works closely with a trusted network of 3PLs and customs clearing agents to minimize delay-based costs. By serving as a central communication hub, we streamline complex supply chains, enabling swift issue resolution and promoting transparency with all stakeholders.
Our proactive approach ensures timely identification of potential delays and the continuous improvement of procurement strategies. We carefully select logistics partners based on regional coverage, service specialization (e.g., cold chain, hazmat), and use of advanced tracking technologies, recognizing that no single provider fits all needs.
Through open, competitive, and transparent contracting, we build a resilient and agile 3PL network tailored to navigate country-specific importation challenges. These strong partnerships allow us to move beyond daily operations and take on a strategic advisory role.
By maintaining open communication, aligning on goals, and leveraging each partner’s strengths, we help optimize the supply chain end-to-end. This collaborative approach improves efficiency and reliability and significantly reduces costs linked to extended container or port usage.
Unique orchestrating position for coordination and oversight
As a 4PL solutions provider, PFSCM meticulously oversees the performance of 3PLs throughout the end-to-end supply chain.
We continuously monitor key performance indicators by establishing clear service level agreements and using tailored data intelligence tools. This routine performance monitoring allows us to identify and address potential bottlenecks or inefficiencies early on.
Further, our orchestrating role enables the implementation of performance-based work allocation. This incentivizes partners to maintain high-performance standards, directly contributing to reducing delay-based charges by ensuring timely deliveries, accurate order fulfillment, and efficient customs clearance processes.
Finally, we focus on fostering long-term partnerships built on clear communication, mutual goals, and trust. This ultimately leads to improved service and cost performance, including reducing costly delay-based charges.
Country scenarios
PFSCM Logistics Lead Luan Greeff and Logistics Specialists Maria Bitonte and Lucas De Aguira explained how PFSCM collaborated with partners in Nigeria, Tanzania, and Uganda to resolve supply chain complexities that could result in delay-based costs.
Nigeria: a long partnership where incremental improvements resulted in a significant impact
Nigeria is PFSCM’s top country in terms of the value and volume of goods ordered and delivered.
Over the years, we have encountered unique importation hurdles and have taken several actions to help our clients navigate the complex importation environment to prevent health products from getting delayed at or beyond ports and incurring delay-based charges.
Between 2022 and 2024, we have achieved an 85% decline in delay-based charges.
Some of these actions that contribute to this ongoing success include:
- Process mapping: We identify key stakeholders and prepare detailed shipping instructions.
- Checklists: We help ensure all required shipping documents are in order.
- Online tracker: During times of intense change (e.g., the adoption of an Import Duty Exemption Certificate or IDEC), we monitored the paperwork and exemption certificates needed for importation using an online tracker.
- Accurate data: We ensure accurate and complete data, which expedites the approval of exemption certificates (product registration or tax waivers).
- Understanding processes: We educate supply chain stakeholders, including suppliers, so they are aware of the importation processes and requirements.
- Triple-check information: We verify information in importation documents to prevent delays.
- Use automation: We encourage and support clients to leverage the electronic applications available to accelerate importation and clearing processes.
- Communication and collaboration: We build relationships with all parties to ensure smooth operations.
- Contingency planning: We understand and document processes and systems for effective contingency planning.
Lucas De Aguir explains that PFSCM has a dedicated team and an in-country advisor helping recipients, clients, suppliers, and 3PLs to navigate importation procedures to reduce lead times and ensure fast clearance of urgent shipments for Nigeria.
“This team collaborates with stakeholders to open channels for proactive communication, thereby improving the flow of information and empowering stakeholders to make sound decisions and solve problems before they result in additional costs,” he adds.
Importing health products into Nigeria involves navigating a complex regulatory landscape designed to ensure the safety and efficacy of medical goods entering the country. The National Agency for Food and Drug Administration and Control (NAFDAC) plays a pivotal role in this process, overseeing the registration and regulation of food, drugs, medical devices, and related products. Importers are required to provide comprehensive documentation, including detailed product information and descriptions of manufacturing facilities, to obtain necessary approvals.
Additionally, the Standards Organisation of Nigeria (SON) implements the SON Conformity Assessment Programme (SONCAP), which mandates that imported products meet specific Nigerian standards before shipment. This program is crucial in maintaining the quality of goods entering the Nigerian market.
For humanitarian aid and donated health products, certain waivers and exemptions are available to facilitate their swift entry into Nigeria. The Import Duty Exemption Certificate (IDEC) is one such provision, allowing for the duty-free importation of qualifying goods. To obtain an IDEC, organizations must apply through the Federal Ministry of Finance, providing evidence that the imported items are intended for humanitarian purposes. NAFDAC may also grant product registration waivers for donated medical products, streamlining the process to ensure timely distribution to those in need. However, these waivers are subject to strict scrutiny to prevent the influx of substandard or counterfeit goods.
Despite these provisions, importers often face challenges due to overlapping regulatory requirements and procedural intricacies. Coordinating approvals from multiple agencies, such as NAFDAC and SON, can be time-consuming and may result in delays, particularly if documentation is incomplete or standards are not met.
Moreover, while waivers like the IDEC aim to ease the importation process for humanitarian goods, obtaining these exemptions requires meticulous compliance with application procedures and criteria. Understanding and adhering to the specific mandates of each regulatory body is essential for the efficient importation of health products into Nigeria.
PFSCM has extensive experience advising our clients on how to navigate the importation complexity for Nigeria.
Contact us to learn how PFSCM can support your health program, project, or initiative with our 4PL services.
Lagos Port Complex also referred to as Premiere Port (Apapa Quays).
Tanzania: simultaneous shipping and waiver processing, a testament to reliable processes and partners
In Tanzania, which is also one of PFSCM’s larger clients, we have achieved a 91% decline in delay-based charges between 2022 and 2024.
Maria Bitonte explains that the success can be attributed to a multipronged approach, which included negotiating with the 3PLs for more free storage days at the port of entry, contracting 3PLs who have professional clearing agents who can manage the tax and product registrations efficiently, and carefully coordinating inspections if required either in-country or at the supplier’s production facility.
“The waiver application and approval process has become so efficient in Tanzania that it is possible to ship health products while the waivers are being completed.
“For many countries that still face slower processing times, the green light for shipping is only given once the waivers are ready, but naturally, this extends lead times somewhat,” she concludes.
In 2019, when the country faced an abrupt regulatory change that resulted in severe importation bottlenecks, PFSCM collaborated with stakeholders to remap the extensive importation process and saw lead times reduced back to under 10 days and delay-based charges decreasing by 86%.
Uganda: managing an overland journey, leveraging depots, and monitoring documentation closely for risk management
For Uganda, which is another prominent PFSCM country, we have achieved an 88% decline in delay-based charges between 2022 and 2024.
Luan Greeff explains that importing health products into Uganda presents logistical and regulatory challenges that can lead to additional costs.
“While Uganda benefits from relatively generous free container days, delays can still snowball into significant costs.”
In addition, as a landlocked country, Uganda relies heavily on the port of Mombasa in Kenya, followed by overland transport via truck.
Greeff says this second leg is prone to delays, and shipments are typically routed through inland container depots at border posts, where a second round of customs clearance occurs.
“Any misalignment in documentation or procedural delays here can extend the container turnaround time and incur extra charges.”
Further, he notes that several administrative processes also complicate the process.
“Various documents – especially for humanitarian aid shipments exempted from import taxes – need to be processed promptly, and extensive coordination is required between various regulatory agencies and government departments.”
He adds that importers also need to keep a close eye on their Taxpayer Identification Numbers, which need to be renewed every year, highlighting this step as an often-overlooked area.
Greeff stresses that even a single clerical error, unavailability of key signatories, or misclassification of goods can trigger cascading delays.
To minimize delay-based charges, PFSCM takes the following actions:
- Coordination: We communicate proactively with suppliers, 3PLs, customs brokers, and donors to prevent small issues from becoming major cost drivers.
- Use of transit warehouses: We store goods temporarily at bonded or transit warehouses, which allows containers to be returned promptly, stopping D&D accrual while giving time for final inland distribution.
- Access to specialized warehousing: We engage and book space with pharma-grade warehouses in advance, especially when large shipments are expected. This prevents bottlenecks at central warehouses.
- Staggering shipments: We split large volumes across staggered shipments. For example, spreading 22 containers over multiple arrivals can avoid warehouse congestion and allow manageable daily offloading, reducing truck and container idle time.
- Planning around calendar constraints: We factor key shutdown periods into import timelines to avoid getting stuck in peak periods.
In conclusion, Greeff stresses the key to avoiding delay-based charges in Uganda lies in careful supply chain planning, timely documentation, strategic warehousing decisions, and close stakeholder coordination—each action preventing minor issues from spiraling into costly delays.
Between 2017 and 2021, PFSCM and Freight in Time (FiT) managed a transit warehouse in Uganda to store health products and reduce delay-based charges while the new Central Medical Stores were being built. Delay-based charges would have reached $3 million if the transit warehouse solution had not been implemented.
Learn how this partnership ensured service continuity and avoided costs.
Contact us to learn how PFSCM can support your health program, project, or initiative with our 4PL services.
Yantian port, shenzhen city, China.
