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GLOBALLOGISTICSMANAGEMENT:THECASEOFABCCEMENT
ABCCEMENTisaFrenchmultinationalandgloballeaderinCementinbuildingmaterialwithastrong presenceintheeasternpartofIndia AsapartofourbrownfieldexpansionatJamshedpur,wehadorderedtheVerticalCementgrindingmill withLoesche,Germany. Rotarycomponentssuchasdrivegearbox,grindingrollers&tableweremanufacturedatHamburg, Germany.(Volume625cum&Netweight417tons) StaticcomponentssuchasMillstand,baseplateweremadeatShanghai,China(Volume433cum &Netweight150tons) Somecomponentssuchasseparatorfixedplateetc.,wereoutsourcedbyLoescheinChennai,India.

ThetaskathandwastotransportthematerialsafelyfromLoeschesworksatShanghaiandHamburgto Jamshedpur,India. ThemiscellaneousconsignmentfromChennaiwasmuchsimplerandthereforehandledbyusthrougha localtransporter. WhenweanalyzedthemodalityofshippingtheconsignmenttoIndia,werealizedthatwedidnothave muchexpertise/knowhowonthefollowing Importformalitiesanddocumentation Indepthknowledgeofthecountriesinvolved. Knowledgeofthecarriersandroutes Risksinvolved Consignmenttrackingandmonitoring

Q.<WHATCOULDABCCEMENTINDIADO?>
ITL,Dr.DSinha,IIFT,KOLKATACAMPUSCASESTUDY:ONLYFORCLASSROOMDISCUSSIONS

2 Therefore,wedecidedtoengageaThirdpartylogisticserviceproviderwhomeetsthefollowing requirements PresenceinGermany,China&India Knowledge/Expertiseonimportformalities,routes,carriers,territories,infrastructurelimitation, appropriatematerialhandlingtechniquesandmachinery Crediblepastrecord&experienceinhandlingsimilarconsignment Resourcesandinfrastructuretohandleajobofthisnature. HastheITcapabilitytotracktheconsignmentonacontinuousbasisusingGPStechnology.

Afterevaluatingvariousoptions,wefinalizedonM/s.Kuehne+Nagel,whoarebasedoutofGermanyand havingglobalpresenceinAmericas,Europe,Asiapacific,MiddleeastandAfrica.

Q.HOWWOULDABCCEMENTINDIAPVTLTD.EVALUATETHEPERFORMANCEOFM/s. Kuehne+Nagel?
ITL,Dr.DSinha,IIFT,KOLKATACAMPUSCASESTUDY:ONLYFORCLASSROOMDISCUSSIONS

3 Followingwerethekeychallengesfacedinthetask.PerformanceoftheThirdpartylogisticproviderwas evaluatedbasedonthesame. Safetyofconsignment(Accidents/damagesetc.,) Securityofconsignment(pilferages,lossofdocumentetc.,) TimelyshipmenttoJamshedpursite. Crossborderlegalissues Repacking/correctionifreqd Continuousmonitoring/tracking CoordinationandnetworkingwithmultipleagenciesEquipmentmanufacturerandtheirtransporter,third partyqualityinspectors,Customs,Carriers,Inlandtransporters. InlandtransportationEasiestandsafestroute,infrastructurelimitations(Bridges/raillinecrossing/ narrowroads,Congestedandthicklypopulatedareasenroute Manageenvironmentalissues&liaisonwithcustoms,railways,villagers,highwayauthorities,local administrationenroute,policeetc., Allocationofresponsibilityatvariousstages Executionoftheactivityatminimumcost

Q.WHATISROUTINGPLANOFABCCEMENTINDIAPVTLTD.?
ITL,Dr.DSinha,IIFT,KOLKATACAMPUSCASESTUDY:ONLYFORCLASSROOMDISCUSSIONS

Q.WHATSEAROUTETHECARGOWOULDFOLLOW?
ITL,Dr.DSinha,IIFT,KOLKATACAMPUSCASESTUDY:ONLYFORCLASSROOMDISCUSSIONS

GLOBALSEAROUTES (ROUTEDESCRIPTIONATANNEXURE)

ITL,Dr.DSinha,IIFT,KOLKATACAMPUSCASESTUDY:ONLYFORCLASSROOMDISCUSSIONS

SEAROUTEFROMHAMBURGTOMUMBAIPORT

SEAROUTEFROMSHANGHAITOMUMBAIPORT

ITL,Dr.DSinha,IIFT,KOLKATACAMPUSCASESTUDY:ONLYFORCLASSROOMDISCUSSIONS

Q.ISTHISTHEBESTROUTING?WHATAREFACTORSFORCHOOSINGAPORT? INLANDTRANSPORTATIONROUTEFROMMUMBAITOJAMSHEDPUR

Figure:Inlandtransportationroute (MumbaiPortThaneNasikDhuleBandaraRajnandGaonBhilaiRaipurRaigardhGumla RanchiJamshedpurJojoberaCementPlant)

Q.CANTHEREBEALTERNATEMODEOFTRANSPORT
ITL,Dr.DSinha,IIFT,KOLKATACAMPUSCASESTUDY:ONLYFORCLASSROOMDISCUSSIONS

Break Bulk Import cargo operation and documentation flow (India)

KUEHNE + NAGEL Projects 2010

Process Steps

Customs Process

Logistics Service Provider Sea Freight project & Import Department

Importer

Prealert

Prealert received from Origin office.Notice of shipment sent to Consignee.

Based on the documents submitted by the carrier's the customs approves the IGM

M Filing and B/E processing

Copies of Master B/L ,House B/L.Invoice and Packing List sent to carrier for filing of IGM .Carrier files the IGM with customs prior arrival of shipment at port

The consignee forwards the invoice and pac to K+ N for filing of Bill of Entry with custom shipment is under some special licence it i handed over to K+N.

Customs checks the Bill of Entry advises discrpancy ,if any.

K+N files prior Bill Of entry and arranges to send check list to cnee for confirmation about duty amount.After confirmation from cnee KN arrnange for assessment of Bill Of Entry with customs.

Arrival of shipment at destination.

Shipment arrives at destination and consignee is sent arrival notice.Delivery Order is picked up from carrier after paying all charges and surrendering of the Carrier B/L

Consignee surrenders the duly endorsed House B/l.

ITL,Dr.DSinha,IIFT,KOLKATACAMPUSCASESTUDY:ONLYFORCLASSROOMDISCUSSIONS

Physical examination of cargo by Customs.Duty figure is confirmed after completion of i ti

K+N takes permission from customs to open pkgs for physical examination of the cargo in port.

Delivery of cargo

Once duty is paid the Bill of Entry is endorsed by customs and cargo is released..

K+N picks the Demand Draft for the duty from the consignee and pays same to customs.

Consignee arranges for customs duty payable by Demand Draft once K+N confirms the duty figure.

K+N pays the port dues if any and gets the gate pass from port Authorities.K+N arranges trucking for delivery cargo to consignee premises.

Cargo received by consignee's at their premises

K+N raises invoice on the consignee for the services as per agreement and sends same to consginee for payment.

Consignee's arrange for payment of charges as per K+N invoice.

Upon receipt of all charges from the consignee's K+N arranges to send the Original Bill Of Entry to the consignee's as this is required by them for disbursement of foreign exchange

Upon receipt of Original Bill of En from K+N the consignee's procee complete their disbursement of foreign exchange.

ITL,Dr.DSinha,IIFT,KOLKATACAMPUSCASESTUDY:ONLYFORCLASSROOMDISCUSSIONS

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CHOICEOFCARRIER

Figure:Inlandtransportcarrierandunloadingplan

ITL,Dr.DSinha,IIFT,KOLKATACAMPUSCASESTUDY:ONLYFORCLASSROOMDISCUSSIONS

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CONSIGNMENTTRACKING

Figure:Webbaseddashboardforvesseltracking WebbaseddashboardforcargotrackingInland ITL,Dr.DSinha,IIFT,KOLKATACAMPUSCASESTUDY:ONLYFORCLASSROOMDISCUSSIONS

12 Actual date
Sr.No. of arrival (At Port) Package No. LR NO.

Sample -ABC- CEMENT India Pvt.Ltd - Cargo Tracker Sheet

2nd Lot - Antwerp port to Mumbai port - Total 45 Packages
Vehicle numbers Type of Vehicle Vehicle Position State Place Total Distance from Distance covered Mumbai port to Site (Kms) from Port (Kms)

1 2 3 4 5 6 7 8 9 10 11 12 13

19.09.09 19.09.09 19.09.09 19.09.09 19.09.09 19.09.09 19.09.09 19.09.09 19.09.09 19.09.09 19.09.09 19.09.09

7 44,3,25 8,9 1 13,35,39 26,11,40,5 27,28,12,17 10,29 2,6,20,33 30,23,22,19,4 31,24,21,18,34 42,32,14,16,36

3084 3085 3086 3087 3088 3089 3090 3091 3092 3093 3094 3095 3096

RJ01GA-4604 16 Wheelers - Low bed volvo Maharashtra CG04JA - 6916 MH-06 AQ-2397 MH 43U-566 NL-01D-2629 NL-01D-1039 NL-01D-2669 RJ-06G-5247 MH-06AQ-320 PB-06G-6664 CG-04JB -2074 MH-06K-3520 CG/04/JA/4621 Semi Low bed Low bed Hydrolic Exel Semi Low bed Semi Low bed Semi Low bed Low bed Semi Low bed Semi Low bed - 3 Exel Semi Low bed - 3 Exel Semi Low bed Semi Low bed Maharashtra Maharashtra Maharashtra Maharashtra Maharashtra Maharashtra Maharashtra Maharashtra Maharashtra Maharashtra Maharashtra Maharashtra

BHUSAWAL Raipur MP- MH Border Aurangabad Pathalgaon Pathalgaon Pathalgaon AKOLA Raigarh Raipur Raipur Bhandara Amravati

2050 kms (Appx) 2050 kms (Appx) 2050 kms (Appx) 2050 kms (Appx) 2050 kms (Appx) 2050 kms (Appx) 2050 kms (Appx) 2050 kms (Appx) 2050 kms (Appx) 2050 kms (Appx) 2050 kms (Appx) 2050 kms (Appx) 2050 kms (Appx)

600 Kms 1150 Kms 1050Kms 450 Kms 1400Kms 1400 Kms 1400 Kms 700Kms 1300 Kms 1150 Kms 1150 Kms 950 Kms 700 Kms

19.09.09 15,35,38,41,43,45SP1

Q.WhatelsecouldbetheMISSTRUCTUREforABCCEMENTPVT.LTD.
ITL,Dr.DSinha,IIFT,KOLKATACAMPUSCASESTUDY:ONLYFORCLASSROOMDISCUSSIONS

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ANNEXURE
Circum Equatorial Route. With the expansion of the Panama Canal expected to come online in 2014, a relative parity will exist for the first time between the Panama and Suez canals. In such a setting, maritime shipping companies may elect to establish circum equatorial routes in both directions with the usage of high capacity (8,000 to 12,000 TEU) containerships. This high frequency "conveyor belt" could support a significant share of global east-west freight movements in a cost effective way. This does not imply a homogeneous service as several different configurations of ports of call are possible along this route, particularly if a 300 nautical miles deviation is considered. This enables different circum equatorial network configurations. North-South Pendulum Connectors. These connectors reflect existing commercial relations, namely for raw materials (oil, minerals, agricultural goods), such as South America / North America, Africa / Europe or Australia / Asia. For container shipping, they are mostly based on the rationale that there is not enough volume to support transoceanic services, so cargo is collected / delivered along a latitudinal sequence of ports. This conventional network will be expanded with transshipment Opportunities with the circum equatorial route. Transoceanic Pendulum Connectors. Connect through pendulum services selected ports of the facades of large oceanic masses. The three main transoceanic connectors are transpacific, Asia-Europe (through the Indian Ocean) and transatlantic. The industrialization of Asia (China in particular) has made the Asia - Europe and the transpacific connectors particularly important. Growth within the BRIC countries (Brazil, India and China) favors the emergence of a new connector in the Southern Hemisphere between the east coast of South America, the Cape of Good Hope and to Southeast Asia. Transshipment Markets. They connect regional port systems to transoceanic and circum equatorial routes, mainly through hub-and-spoke services. The relay function between long distance shipping services performed by those markets is also significant. The most important are Southeast Asia, the Mediterranean and the Caribbean. They are referred as markets because the transshipment function can be substituted to another port. Therefore, a group of ports in a transshipment market are "bidding" for port calls as this type of traffic is difficult to anchor. The development of circum equatorial routes is thus likely to expand the opportunities of transshipment, including interlining between these routes.

ITL,Dr.DSinha,IIFT,KOLKATACAMPUSCASESTUDY:ONLYFORCLASSROOMDISCUSSIONS