Performance guarantees: Why we want to provide them to our customers

Availability and performance guarantees are based on a simple idea that can be extended in various dimensions based on the customer’s needs. To start the discussion, we can begin at the first level – the rental business. Instead of selling machines, we lease them to our customers, ensure the machines are available and maintained according to a defined schedule, and deliver the required spare parts. At the next level, we can, for example, commit to providing spare parts within X hours or days.

When we expand our concept of availability guarantees, things become a bit more complex, but we also increase the level of value that we bring to the customer. In this scenario, it is up to us at Kalmar to calculate what size fleet we need in order to ensure the required number of operational machines at all times. The key point for both parties is to realise that once we have responsibility for not only the machines, but also their connectivity, optimisation and maintenance, we can offer (and guarantee) higher levels of performance and availability than with traditional maintenance models.

When we expand the concept, things become a bit more complex, but we also increase the level of value that we bring to the customer.

Finally, the ultimate aim – and one that we have already been discussing with many of our customers for some time – is a performance-based business model, in which we get paid not by the number of container handling machines we sell or lease, but on the basis of their performance, such as completed container moves per hour. This is something that won't be achieved overnight, but it is a long-term goal to which we are committed.  

It is important to bear in mind that despite this vision of running a moves-per-hour container handling business, we are not looking to become port operators, or to edge in on our customers' territory. On the contrary – our role will be to bring more value to our customers’ operations through our own experience and expertise, so that they can concentrate on their own business.

This is not a simple path to follow, and we understand that it may not be for every customer. Some will prefer a traditional contract model and we will of course cater to them too. However, for those ports and terminals that are willing to take the next step in developing their operations, we are ready to discuss and negotiate from a stance of mutual understanding of each other's strong points and business goals.

Our industry has worked with transaction-based business models for over 100 years. Now it's time to go further. Are you ready to think in a new way and to take the performance of your terminal to the next – guaranteed – level? If you are, we will be there for you, ready to meet the challenge.

Antti Kaunonen
President, Kalmar