Global shipping and supply chain congestion has led to Chinese furniture manufacturer and retailer Loctek becoming a shipowner.
In what is believed to be an industry first, the Shenzhen-listed manufacturer and distributor of ergonomic equipment and furniture has splashed out $32.6m on a single 1,800-teu container ship newbuilding.
Loctek said in a regulatory filing that it has signed a contract with domestic shipbuilder Huanghai Shipbuilding with delivery scheduled for March 2023.
Loctek said it has ordered the ship to enhance its competitiveness and to “accelerate the development of its overseas business”.
“Since the outbreak of Covid-19 in 2020, the efficiency of worldwide ports has been low and this has affected the supply chain. On the other hand, global ecommerce and online trading are surging.”
Loctek said its online retail business is facing exponential growth and it needs to deliver products to customers in an expedient manner.
To enable the company to shorten delivery times and improve inventory turnover rates, it plans to integrate its warehouse and logistics services with shipping.
Loctek said that having its own vessel will also enable it to have better control over freight costs.
The company is not the only newcomer to shipping from the retail and manufacturing sector, although it may be the first to invest in newbuildings.
As a result of the unprecedented disruptions in the liner trades caused by the pandemic, Swedish furniture giant Ikea and US retail behemoths Walmart, Costco and Home Depot have all chartered container ships, while soft drink manufacturer Coca-Cola has opted to carry its product on bulk carriers.