THIS question often provokes a wide range of answers or, more accurately put, speculations from container lines as to what is at the top of every shipper's wish list.

At the heart of this debate is the quandary over whether service or price is what matters most to these BCOs.

Following the suicidal rate drops in early 2006 on the Asia-Europe trade lane, we asked numerous shipping lines why they dropped rates despite high utilisation levels. A number of them answered in a rather alarming fashion.

General consensus among the lines was that the situation was uncontrollable. Ill-advised carriers believed there was to be a major supply glut in 2006 and 2007. In response to this scare, a few carriers dropped their rates in order to gain market share. In a bid to remain competitive, others lines responded.

Regrettably, they failed to recognise that there is only one thing you can be assured of when pricing becomes your core strategy in besting your rivals: nobody wins.

The root cause of this collapse was not just a belief in faulty forecasts. Rather the situation went from bad to worse due to a profound misunderstanding, on the part of many carriers, as to what their customers truly wanted.

"You can talk all you want about maintaining freight rates, but in reality the shippers only care about getting the best price," one Hong Kong managing director of a major carrier told us.

However, this is not always the case. In fact, a majority of shippers we have spoken to say they are willing to pay more for better service. If the carriers focused their attention on providing better service they would not have had to sacrifice their profits by competing on rate.

This is a message we have often repeated in the pages of this publication. The answer is simple: compete on service and not on price.