Đề tài Logistics basic knowledge and logistics activities of Indochina Logistics & Trading JSC

erve customers in forwarding industry, they have our strong arm of logistics. The strong and close relationship with port authorities, customs department, and state owned inspections has allowed their company to grow in a strategically sound manner and with business expertise. Plenty of containers and all kinds of cargoes are smoothly and efficiently imported and exported to deliver customers punctually every year Indochina Logistics is known for its ability to quickly respond to customer needs and provide knowledgeable assistance with individual concerns. - Management structure: Management Board (Hai Duong office) Sales & Marketing Department Operation Department Accounting & Administration Department Oversea Department Overland Trucking Department Ha Noi office Hai Phong office Each department has its own tasks. In this report, I only focus you on three main departments in Indochina Company. Those are Management Board, Sales & Marketing Department and Operation Department. – Management Board: owner of the company. They run the company and carry out the strategic goals, manage the company such as: meeting, marketing, delivering quality and services. *Responsibility: They have a responsibility to Support operations and administration of board by advising and informing Board members. Oversees meeting with partners, marketing, delivery and quality of programs and service. In addition, they recommend yearly budget for Board approval and prudently manages organization’s resource within those budget guidelines according to current laws and regulation. Effectively manages the human resources of the organization according to authorized personnel polices and procedures that fully conform to current laws and regulations. Assures the organization and its duty, programs and services are consistently presented in strong, positive to the partner. *Authority: They employment and fire employees, separate of make effective recommendations to separate employees, making decision on the company’s finance, having authority to make some independent decisions to the business. – Sale & Marketing Department: In any kind of business, marketing always plays an important role. “The purpose of marketing is not necessary to promote consumption, its real purpose is to identify and understand customers, and they can themselves consume”; in details, Indochina also its own marketing strategy, especially, marketing sales. The sales executives make the needs of customers become their wants. To be a sales executive, the seller must understand exactly what their customer’s need and try them best to satisfy those. There are several ways to please customers, but the most efficient way to satisfy those needs by the most competitive price and the comfortable services. In Indochina, sellers take an important part. The market share of the company depends on how the sellers target customers. By their art of marketing and sales, their customers believe o their services and let Indochina to take care their cargoes. One important process in selling services is to make quotation. The quotation is not fixed time by time but depended on some certain issues such as schedule, transit time, fee of shipping lines (air lines, sea lines). For a certain destination, sales executives choose the best receiving agent following criterions such as good services, close relationship, quick payment. It is fact that Indochina services fees can be divided into many kinds following up the place of shipment and place of destination. Door to door service is the most completely service of Indochina. In this quotation, Indochina quotes their customers the freight of local export (import) handling services charges, freight charges (air freight, sea freight) and then local import (export) handling charges. As per this main quotation and the order of customers, Indochina divides Door to Door services into many smaller terms that are suitable to the terms of shipments on the business contract of customers. For example, Door to port services, port to port services, port to door service, to door service, ect, ... . – Operation Department: Operation department starts to open file upon receiving the instruction from Sales and Marketing department, the Operation department will start open file basing on invoice, packing list from customers, Indochina issues HOBL (House Original Bill of Lading) for customers. This Bill of Lading is considered as the contract between Indochina and customers. In the next step, Indochina makes chipping instruction and then sends to shipping line. It contains following information: container number, shipper name, consignee name, port of lading, port of discharge, weight of cargo, quantity, etc. Shipping line issues MOBL (Master Original Bill of Lading) basing on this shipping instruction. After cargo delivered, the site staff makes shipping advise is the notice of local or foreign buyers that shipment has occurred with details of backing, routing, ect. A copy of invoice is usually enclosed and sometimes a copy of bill of lading. This document helps receiving agent receive goods quickly and actively. Bill of Lading is a very important documentation in logistics field. Bill of Lading is a principal transportation document by which a carrier acknowledges receipt of the freight and sets forth a contract of carriage. Bill of Lading may be negotiable or non-negotiable. Every Bill of Lading must contain at least the following: 1- Date of issue 2- Name of consignor 3- Place of original consignment 4- Place of delivery 5- Statement of whether goods are to be delivered to a specific person 1.3 – SERVICES: 1.3.1- Custom clearance services: Indochina Logistics will solve all confuse task of Customs declaration services for importation and exportation of moving consignment the fast and efficient as possible: Filling the Customs Declared Form. Customs Declaration and Tax Code Application. Carrying out procedures of Commodity Control or applying for Extra commodity control. Dealing with parties concerned to comply with all sub-formalities upon the requirement of Customs house including: Cultural control, Geology control, Quarantine of botanical – animal – foodstuffs, fumigation, etc.... Carry out of formalities to apply for Certificate of origin (C/O) Forms A, B, C, D ... 1.3.2- Ser freight services: Indochina Logistics offers its customers flexible service options for ocean freight transportation. Our sea freight services encompass capabilities for handling less-than-container load (LCL) and full-container load (FCL) shipments, break bulk cargoes and charter services. FCL/LCL import/export. Door to door transportation. Issuance and verification of documentation. Export and import customs clearance. Packing and crating. Warehousing and distribution. Part & full vessel charter. Conventional shipments. Transport insurance 1.3.3- Multimodal transport: Inland transportation of your cargo (FCL/LCL) by trucks from any ports of Hai Phong, Quang Ninh to Industrial processing Zones within Viet Nam Northern City and other neighboring provinces. Domestics and Import/ Export transportation under method “Door to Door” and under other request of yours. Combined transportation at your request: sea – air, air – air, rail, river and road combined whichever the most appropriate. 1.3.4- Ship booking and Chartering: Sale and purchase of vessels: New building/ Second hand. Ro-Ro and Dry bulk chartering, Deadweight ranges from 1000 mt to 30000 mt for transportation Agricultural products, Rice, Wheat, Salt, Fertilizer, Cement, Clinkers, Coal, Steel and Truck/ Car... Liquid bulk chartering for transportation crude oils, clean petroleum products, chemicals, acids, liquid gas and veg oils... 1.3.5- Customs consultancy services: Customs clearance of import & export shipment can be particularly difficult, is not applicable under the same practices and standards in every country. Especially, if documentation is not prepared properly and carefully, any and all discrepancies can result in delays, extra costs and/or penalties. Indochina Logistics can help its customer how to solve the above problems, including guidance in customs clearance in Viet Nam as well as in other countries where your goods should be exported. Indochina Logistics’ Customs Consultancy Services include the following: Customs formalities of all kinds of imports and exports including commercial goods, aid shipment, project cargoes, transit cargoes, exhibits, temporary export/re-import, temporary import/re-export, non-commercial goods. Consultancy on customs declaration, tax access and other relevant tax & duty policies. Consultancy on customs formalities and clearance in other countries. 1.3.6- Customs brokerage services: Prompt and effective clearance of international cargoes is critical to the successful supply chain. As a total logistics solutions provider, Indochina Logistics deploys one of extensive customs brokerage operations. Indochina Logistics incorporates a team of professional customs brokers, import and export specialists. Indochina Logistics’ Customs Clearance Services include the following: Legal valuation of merchandise. Classification of goods. Proper tax & duty assessment. Import/export procedure. Temporary Import/export procedure. Port clearance. Maintenance of record. Consultancy services. 1.3.7- Air freight services: Sensitive and valuable goods are often subject to extreme time pressures and deadlines for every one involved. Therefore, our air freight department provides comprehensive air freight services to meet our customer's specific. Our Air Freight Services offer all types of transport option, including: Import and export air freight. Packing and crating. Door-to-door service. Customs clearance. 1.3.8- Warehousing & Distribution services: Indochina Logistics offers storage facilities at key destination of Viet Nam. All goods are properly protected so that they can remain in our warehouse for as long as the customer deems necessary.Our warehousing and distribution systems will pick, pack, store and distribute consignments anywhere in Viet Nam by efficient mode of transport. Our Warehousing and Distribution Services include the following: Receiving and inventory. Sorting and segregating. Forklifts and cranes. Pick and pack, labeling. Crating. Delivery and emergency parts distributions. Security. Insurance. 1.3.9- Fairs & Exhibition services: Indochina Logistics offers comprehensive exhibition forwarding services to/from international trade fairs and exhibitions. Our Fair and Exhibition Forwarding Services include the following: Planning & preparation. Inland freight arrangement. Cargo consolidation. Customs clearance. Ocean & air freight arrangement. On-carriage to show ground. Unloading at show ground. On-site assistance. Storage arrangement. Return & on-forwarding. 1.3.10- Removal Relocation: You need to move your personal effects and household goods to the news location, what must be packed? Which transportation route is the most favorable? And the price? And the security, insurance, customs clearance and a lot more - that are the questions, but Indochina Logistics will assist you to solve the problems. Indochina Logistics will take full and complete responsibility for the immensely important task of moving your personal effects and household goods to a new home-wherever the destination. Every step of your move will be planned to meet your wishes and no request is ever too much trouble. Our Removal Relocation Services include: Free surveying. Packing and crating consultancy. Transportation consultancy. Packing & transportation planning. Packing & crating. Documentation. Warehousing and trucking. Customs clearance. Air and sea freight Insurance 1.3.11- Project cargo handling: Indochina Logistics offers project management, all associated planning and implementation services, whether you are moving an individual heavy lift or complete industrial plant from various origins to remote construction sites. Our Project Services include the following: Transportation consultancy. Feasibility studies. Road studies. Budget calculations. Project flow description. Cargo supervision during loading and unloading. Full/Partial charter by ocean and air. Consolidation, packing and containerization. Transport insurance. Oversize cargoes transportation. Heavy loads. Barge service. Module movement. Heavy cranes and forklift 1.3.12- Railway transportation: Besides trucking services, Indochina Logistics specializes in railway transport. We provide scheduled group age, full wagon load and less than wagon load, especially international transportation to/from China and OECD area. Our Railway Transport Services offer the following: LCL & FCL services. Assembly positioning of load units. Reliable door-to-door transportation service. Conventional railway transportation using variety of rail wagon suitable for break bulk and oversized shipment. International transportation to/from China and OECD. Customs clearance. Warehousing and distribution. 1.3.13- Overland transportation: Road transportation can not be excluded from supply chain of logistics services. Indochina Logistics provides its customers with scheduled group age services, part load and full truck load transportation. Our Trucking Services include the following: Assembly positioning of load units. Reliable door-to-door transportation service. Transportation of heavy lifts, over-sized, bulk and sensitive Cargoes. Special transportation of household goods and personal effects. Transportation of transit cargoes. Transportation of temporary admission cargoes. Warehousing and distribution. Chapter 2: Logistics basic knowledge and logistics activities of Indochina Logistics & Trading JSC. 2.1- Logistics basic knowledge: The verbatim definition of logistics in a course book of ESCAP (Economic and Social Committee in Asia and the Pacific) in 2000 says, “Logistics/ Supply chain management is the synchronized movement of inputs and outputs in the production and delivery of goods and services to customers.”  Also in the documents of ESCAP, another definition is raised: “Advanced logistics and Supply chain management means: The concept of synchronizing the operations of different organizations in logistics chain and giving necessary feedback to organizations in production and/or to material distribution divisions in a real time with the help of information technology and digital communication network.” So, here are some highlight points: This is the synchronized movement of materials and products. The definition refers to the movement of both inputs and outputs. The point which needs special attention is that logisticians need to make use of digital communication to give necessary feedback to producers, distributors, and consumers.  There are many different definitions of logistics service, however, each definition focuses on a certain aspect, for example one definition says, “Logistics is the process of planning, implementing and managing efficiently the cost of flow of materials, inventory and finished-products ...” There is also the definition: Logistics is the process of delivering the right products to the right place at the right time. All of these definitions aim to the ultimate requirement of logistics service, which is to ensure the essential quality. 2.2- Logistics activities of the company: Indochina Logistics & Trading JSC is an international provider of integrated logistics services including over-land transport, worldwide air and sea freight and associated logistics services. Indochina provides its customers with professional, personalized guidance in the export and import process. Indochina is known for its ability to quickly respond to customer needs and provide knowledgeable assistance with individual concerns. Even though the most profit of Indochina comes from commercial companies but it its fact that Industrial Zones is long term target of Indochina. Currently, there are some customers in Industrial Zones that Indochina has targeted. Some Industrial Zones using Indochina logistics such as: Phuc Dien Industrial Zone Tan Truong Industrial Zone Dai An Industrial Zone Nam Sach Industrial Zone KEN MARK Industrial Zone STT Company Industrial Zone 1 Brother Industrial Vietnam Co. Ltd Phuc Dien Industrial Zone, Hai Duong 2 Regent Garment Co. Ltd Nam Sach Induatrial Zone, Hai Duong 3 UMC Electronics Vietnam Co. Ltd Tan Truong Industrial Zone, Hai Duong 4 Sumidenso Vietnam Co. Ltd Dai An Industrial Zone, Hai Duong 5 KEN MARK Industrial Co. Ltd KEN MARK Industrial, Hai Duong 6 MACRO MAX Co. Ltd KEN MARK Industrial, Hai Duong List of customers in Industrial Zones With the customers in Industrial Zones, Indochina must target in long term. Indochina set target into steps. The first step, Indochina contacts with persons in charge (the person who will decide the transport provides for the cargo) and then making good relationship with them. After the first time of targeting, Indochina must give them the best quotation that they need. For the first time of providing services, Indochina must try their best to make all things go smoothly. Any way, in order to sell services to this kind of customers, Indochina must take time to persuade that they are really caring about business. Beside the above customers in Industrial Zones, Indochina targets other sources of customers. Each group above needs a different way target. The report will show you the art that Indochina used to target. Turn to the second group, Ltd companies are the potential customers of Indochina. Even though this group of customer does not bring the biggest profit but it takes an important role in Indochina financial statement. In comparing to the customers in Industrial Zones, the groups do not have many goods to deliver but in each consignment the amount of goods is very large. The profit per consignment is also bigger in comparison with the profit comes from the Industrial Zones group. It is because the fact that Industrial Zones are very potential ones for logistics companies. It is difficult for Indochina to complete without a nice pricing policy. One important group business partners of Indochina are agents. There are many agents that Indochina has built good relationship. Below are some best relationships that Indochina has built. List of agents of Indochina JAPAN JAPAN TRACY CORP NAIGAI NITTO CO. LTD TAIWAN AST FREIGHT SERVICES CO. LTD UK EXCEL AIRFREIGHT LTD SIGMA ASL LOGISTICS LTD It is fact that when building relationship with agents, Indochina must make an agency agreement. After the agreement, Indochina and the agent will make the transaction. When receiving requests for pricing of Indochina, agents will immediately send Indochina the best price Indochina has. And then, Indochina sells its customers for using services. The process consists of two steps as follow: Step 1: Indochina’s customers want to deliver goods -> they will contact with Indochina and ask for price and other terms -> Indochina contacts with its agents in the country that goods are delivered -> Indochina ask agents for pricing and any other necessary information such as shipping line, name of carrier and transit time, ect -> Agents will inform Indochina all necessary information -> Indochina informs to its customers -> deliver goods. Step 2: Agent will deliver goods into destination port -> send Indochina a debit note -> Indochina collects charges from its customers -> In the end of each months, Indochina will clear the amount with its agents. It is the fact that, the agents system makes transportation go smoothly. With many agents around the world, Indochina can not only choose the cheapest shipping line for customers but also make its business go fluently and efficiently. Indochina Company has reached achievement. Indochina business partners are variety. There are many kinds of business that Indochina targets. Those activities bring profit for Indochina. But the most profitable one is coming from commercial enterprises. Below are some tables that show the result of Indochina activities. Unit Jul. (unit) Aug. (unit) Sep. (unit) Oct. (unit) Nov. (unit) Dec. (unit) 20'DC 652 727 864 993 1,136 1,079 40'DC 821 960 1,091 1,128 1,432 1,314 Package 1,452 1,596 1,736 1,972 2,234 2,019 Pallet 30 69 92 74 89 62 Total in ton 302,470 421,102 453,659 478,692 502,127 485,845 Volume of goods delivered at 2nd half 2008 We can see that Indochina services activities develop stable time to time. There is one point slows down is on December of the year. From the August to November of the year, the demand for delivering goods is very large, but it is smaller on December and some next months. Financial report Term 2007 2008 1st half 2nd half 1st half 2nd half Turnover 13,00 12,00 19,00 16,00 (Billion VND) 25,00 35,00 Profit 1,62 1,34 2,42 1,76 (Billion VND) 2,96 4,18 In the financial report, we must consider two main indictors: turnover and profit. Indochina’s turnover increased remarkably each year, especially for from 2007. This trend is still kept for 2008. As per the financial report we an see that the percentage of increasing in profit between 2007 and 2008 is 41%. This means that, in the 2008 the company has improved its technology and method of going business so that Indochina can save cost and internal management expense for increasing the profit. Chapter 3: Some recommendations to services of Indochina Logistics & Trading JSC and developing logistics Market in Viet Nam at international economics integration progress. 3.1- Services development in the Indochina Company: It can be realized from services of Indochina company, although there is little or no change in their unmodernized communication with clients and information technology has not been widely applied, have covered the essentials of logistics service such as acquisition, handling, storage, transportation and delivery of goods, custom procedures, other documental procedures, client consultancy services, packaging, labeling or other goods-associated services. In order to develop logistics services, the following actions are highly recommended. The company needs to improve their equipments and infrastructure. Logisticians are required to enhance the consolidation to come up with good solution irrespective of the source and destination of goods. The system of oversea consolidation agencies also need to be enhanced for the smooth goods carriage without any difficulties relating to customs formalities, legal procedures or transportation. There is the urgent need that logistics businesses be equipped with digital information technology, with which, businesses can keep close track of goods in and goods out, warehousing, inventory, giving feedback on goods circulation to importers, exporters, producers and distributors. Apparently, information technology requires a considerable investment; however, it should not be avoided. 3.2- Logistics solutions in Vietnam: Logistics is a kind of service, which can bring huge benefits for society. So, Vietnamese government should set up logistics strategies and put forward policies to attract more investment in logistics. Firstly, the government should improve the transportation infrastructure of Vietnam in order to meet the international standards. For example, the high way needs to be rebuilt to meet international standards TEU (ISO 668), for 30.5 tons and 40 feet container. At present, this high way can only be used for less than 30 tons containers. Besides that, the government can support logistics enterprises in term of high technologies or capital to rebuild or enhance their equipment for logistics like warehouse, yard and IT (Information technology) system. Secondly, the government should offer tax incentives to logistics services and logistics providers. For example, the government can reduce the income tax for logistics enterprises or reduce export and import taxes when they use logistics services of local logistics enterprises. This method will stimulate the Vietnamese logistics provides to develop their service. Moreover, companies do not have necessary understanding of international laws and the laws of the nations that Vietnam’s logistic services may concern. Misunderstanding of international laws and cases may put Vietnam logistics enterprises into troubles. Those problem need to be overcome so that enterprises can follow up the development of logistic industry. Finally, the government needs to develop human resources for logistics service. At present, Vietnam has