January 9, 2023
Anders Carlsson

A layman's guide to going digital with a Statement of Facts (SoF)

A layman's guide to going digital with a Statement of Facts (SoF)

How Port Agents can go digital with their Statement of Facts

Shipping dry bulk cargoes requires coordination of a highly complex and fragmented business. But the teams managing the shipments spend much of their time on low value, low complexity work via email, spreadsheets and PDFs, manually entering and re-entering data. 

Figuring out how to simplify these arrangements to avoid costly mistakes and speed up the process necessary to make supply chains more efficient has become the main focus for Enqlare.  

For every moment a ship is not in transit it is generating cost but not necessarily in a position to earn revenue. A ship will of course need to spend some time in port, loading and discharging cargo but this needs to be kept as short as possible so that the vessel can continue on its way.

Improving the efficiency of the different steps in the supply chain will, reduce the time needed to move drybulk cargo and lessen the likelihood of paperwork mistakes that create delays and can be costly.  

For every moment of time that is saved in the supply chain process it will reduce costs, and boost potential profit margins.  

A Statement of Facts

At the end of the stay in port, the assigned port agent will draw up a ships Statement of Facts (SoF), setting out a log of all the events during a ship's stay in port signed by the master and the shipper or receiver of the cargo.

The SoF is a single source of truth for logging information relating to a ship’s port-to-port, vessel movements. It covers all the events during a ship's time in port, in chronological order and is used for the calculation of laytime. 

The period of time when a charterer remains in possession of a vessel after the time normally allocated to load and unload cargo (the laytime), is referred to as Demurrage. The details contained in the SoF are used to calculate the demurrage.

The SoF has usually a standardised format as per the example that is sourced from BIMCO. The document is typically completed by the port agent or the shipmaster. 

A standard Statement of Facts document recommended by BIMCO:

Source: The BIMCO (THE BALTIC AND INTERNATIONAL MARITIME CONFERENCE) 

BIMCO is one of the largest of the international shipping associations representing approximately 60 percent of the world's merchant shipping tonnage and that it has members in more than 130 countries, including managers, brokers and agents. 

The SoF lists things such as the ship’s arrival and departure time, the time at the berth, when cargo is loaded or unloaded, weather and other conditions that may affect the time at port, whether tugboats are used, preparing the loading and unloading operations, the actual loading and unloading operations, unmooring and departure, etc. 

How is a Statement of Facts (SoF) used?

Charterers have the right to nominate a port agent to prepare the SoF, making sure that the ship has been properly managed. The agent will be accountable for recording all activities during the ships time in port. 

The port agency are then responsible for flagging and recording any issues that delay the vessel, to identify the cause and duration, plus track and check facts for all concerned parties. 

The SoF is ultimately used as a reference for the laytime calculation to determine if or how much demurrage is to be paid. 

It is quite common for disputes to arise because of delays; hence the SoF provides the opportunity for notes and comments to be entered that can be referenced in the laytime calculation. 

By providing the stakeholders with a breakdown and status of a ships time in port, all concerned parties have a chance to review and question the details before the ships departure.

For example, adverse weather conditions (e.g. in the event of rain), or days that are considered public holidays, stoppages resulting from breakdown of machinery, industrial disputes and suchlike all need to be logged as they have an impact on the time that a vessel will spend in the port.

Productivity problems with the traditional SoF format 

SoF documents are traditionally created by the agent logging information by pen and paper, with the details then manually entered into an excel spreadsheet and transposed into a PDF form and shared via email.

Stakeholders who receive the information then transcribe the PDF into their version of a laytime spreadsheet and key the data into their own business systems for evaluation.

Having to repeatedly enter data manually, means hours tied up by key resources who could be working on other activities to enhance revenue rather than administration. And frequently mistakes can happen, with lots and lots of retyping, transcribing work multiple times across different systems and along the value chain means there is a risk of transposing figures or just missing important facts or entries.

By compiling the SoF information incorrectly it can mean failing to make sufficiently clear what the cause of a particular delay was or not capturing events that have an impact on timing prior to berthing. Often the process of compiling a SoF can vary from port to port and agent to agent so there can be inconsistencies in how the SoF is administered. 

Plus, data cannot be captured automatically if there is only a manual entry on a printed document that is then scanned for distribution.

Ultimately input mistakes or data missed can mean the Charterers lose the right to make deductions or lead to costly disputes.

Creating smart documents -  Enqlare’s digital SoF

Sharing shipping documents in a traditional PDF format can limit data capture and create unnecessary re-processing of information by the multiple stakeholders. Enqlare’s software enables the creation of digital formats, for example digital SoFs that stakeholders can edit and capture information directly from.

So, port agents and stakeholders can avoid a lot of unnecessary manual re-typing into spreadsheets and laytime calculations, capturing valuable data that can be utilized for value added insights. By having all the information in one place it reduces the risks of missing a task and makes one less point of friction to meet deadlines and focus on priorities.

Users of Enqlare software are also able to share an online link that takes clients and suppliers directly to view a digital SoF, and with everybody on the same page there are less chances to miss important information and it is easy to use for laytime calculations. 

Being able to build reports and dashboards to analyze and assess changes in your business performance is a competitive advantage for an agency to offer as a service.

Enqlare have a cloud-based and secure SaaS solution that can be deployed in minutes not months, as a part of a push for digital transformation.

The Enqlare software offers a digital solution that can dramatically improve the performance of your business through automation and utilizing smart documents designed to help you scale profitably, unlock process improvements, and consistently save time and money.

By making sure the latest information and updates can reliably reach the necessary port actors, the smart documents provide transparency on the time in port, with the data all in one single place for ease of access.

There is great value to be gained by unlocking access to the data that the digital SoF provides, helping to enhance the ability to make better business decisions.

Laytime calculations are time-consuming and a small mistake can easily result in a significant loss but if data is available and accessible early enough to flag an impending issue, action could be taken to avoid demurrage costs. Often without having information readily to hand operators may miss time bars and lose claims altogether.

The Enqlare Laytime module can be integrated into your risk and invoicing systems and help you migrate to a digital SoF to unlock performance insights.

The ecosystem of Enqlare software modules is designed for the shipping industry to help teams create more accurate laytime calculations, speed up the work and avoid costly mistakes by utilizing the digital SoF.

Process laytimes using Enqlare’s digital Statement of Facts

Experience has shown that when you employ a laytime solution, savings can be made (as an estimate it can be >$100K over 100 shipments).

Book your Enqlare Laytime or Port Calls demo.

If you have more questions, contact us at info@enqlare.com or visit our FAQ page to answer your questions.

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Anders Carlsson
Anders Carlsson
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