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What are the Advantages and Differences Between SOC and COC Containers

Shipping containers from China

What is a SOC container?

A shipper-owned container (SOC) is a metal shipping container owned exclusively by an individual or business. Typically, the shipper maintains full ownership of the cargo container and arranges for its transportation by purchasing space on the carrier’s vessel.

In most cases, large importers that handle large volumes of regular cargo (such as IKEA, Walmart, and others shipping from China) typically own SOC containers.

In addition, SOCs offer a tailor-made approach that enables shippers to use them as needed, consistent with their specific transportation schedules and cargo requirements.

What are the benefits of SOC containers?

SOC containers have the potential to reduce freight costs for shippers or businesses with stable shipping needs by eliminating container rental fees.
In addition, SOC containers help avoid unforeseen demurrage (DEM) and demurrage (DET) costs caused by customs clearance delays, port congestion, etc.
The use of SOCs becomes critical in areas where carriers are unable or unwilling to offer containers or offer them at exorbitant prices. Shippers can use it to independently source goods in remote areas
SOC enables shippers to reduce their dependence on external container providers and increase operational autonomy across the entire cargo movement.

What is a COC container?

COC, also known as carrier-owned container, refers to a shipping container owned and managed by a container liner company or carrier. Unlike SOC, COC containers belong to the carrier’s container fleet.

When using a COC, the shipper pays the carrier an all-inclusive rate for transporting the cargo from point A to point B, and the carrier handles intermediate processes, including providing the container.

Once delivery is complete, the COC container is returned to the carrier, who then leases it to another shipper.

It is important to note that, depending on the circumstances, additional charges may be incurred when using COC containers, such as demurrage and detention charges.

What are the advantages of using COC containers?

Carrier-owned containers are typically used for standard shipments on high-traffic routes, providing shippers with the flexibility of FCL and LCL shipments.

If shippers and carriers reach a fair agreement for end-to-end container shipping with COCs, it could be more cost-effective and simpler. Because the shipper only needs to pay the carrier the freight for the international transportation of the goods.

On the other hand, if a carrier has an ample supply of containers, there is little incentive to use them.

Additionally, the shipper returns the COC container to the carrier upon delivery of the cargo, eliminating the need to manage empty containers. It relieves shippers of container maintenance, repair and regulatory compliance responsibilities.

What is the difference between SOC and COC containers?

First, looking at ownership:
SOC containers are fully owned by the shipper or cargo owner, while COC containers belong to the carrier or shipping company.

Secondly, regarding operations:
When using SOC container transportation, you should find a suitable container and submit its certificate information to the shipping company in advance to apply for transportation. After the container arrives at the destination port, it is returned to the designated yard according to the instructions of the container leasing company.

On the contrary, for COC containers, you only need to go to the designated yard to pick up or return the container according to the carrier’s manifest or return list. Additionally, the container and cargo hold are integrated, requiring no additional application or operational steps.

Third, regarding the cost impact:
Generally speaking, it is more economical to pay for the cargo space of SOC containers than to use COC containers. However, the extent of cost savings depends on the space required by the customer, the availability of the carrier’s containers and the fees associated with container returns.

Is it worth buying your own containers?

Owning a SOC container can be advantageous for businesses that transport freight frequently, especially on specific routes or if the volumes are consistent. Additionally, for goods stored in containers for long periods of time, using SOC may be cheaper because there are no demurrage and detention fees to pay.

However, purchasing a SOC can come with significant fees. A used 20-foot container may cost between $1,500 and $3,000, while a used 40-foot container may cost between $2,500 and $5,000. Additionally, there are maintenance, storage, and management costs associated with SOC containers.

Evaluating the cost-benefit of purchasing a shipping container is critical. To do this, you can calculate potential savings by taking into account shipping frequency, rental costs, and the expected life of the container.

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