L – 2 Global SCM Partners / Channel Design and management

TOTAL COST CONCEPT The total cost Concept is the key to effectively managing the processes. The goal of the organization should be to reduce the total cost of logistical activities, rather than focusing on each activity in isolation

MAJOR COST HEADS Place / Customer Service Inventory Carrying Costs Transportation cost cost Low quantity costs Warehousing costs Order processing and information costs

MODE International air freight forwarding International ocean freight Multi-modal transportation Trucking / solutions Rail network

Concepts Air Consolidation Road /rail Indian customs procedures Ocean freight –Containerization –Types of Vessels – B/bulk, Ro-Ro, Bulk, Combi Tankers / LPG/CNG –Port operations –CFS /ICD

Model links Out Bound – Exports Factory Stuffed Dock stuffed In Bound -Imports Dock De-stuffed Factory De-stuffed Along Wharf

Customs Clearance Heads Basic duty – 10% (Depends on the product) Addl. Duty – 8 % or 4 % ( Value + Duty) Education cess – 2 % Sec &High Education cess – 1 % Customs education cess – 2 % Customs Sec. & High Education cess – 1% Sp. Addl. Duty – 4 %

INBOUND CLEARANCE PROCESS

Original HBL, Invoice & Packing List, certificate of origin, catalogue,. Clearance Dept. Manifest the Documents in System Bill of Entry is Generated Bill of Entry is uploaded on Indian Customs Site ICE GATE Bill of Entry Number is Generated in EDI System of Customs Bill of Entry is forwarded to the concerned Appraiser on his screen From here the process is divided into Second Check & First Check

SECOND CHECK Bill of Entry assessment by the Group Appraiser Bill of Entry Passed by the Deputy Commissioner of Customs TR6 & Bill of Entry Print Out taken Cargo is traced at nominated CFS Customs Duty is Paid Delivery Advice is collected from the Consol Dept. on Submission of the HBL

Delivery Advice, Bill of Entry & TR6 Submitted to the Shipping Co. Shipping Co. Chgs. & 0.1% Stamp Duty on Assessable Value & Customs Duty is paid & Delivery Order is Collected Shipment Received Order is taken from the CFS Forwarding is taken from the Shed Appraiser Sealing Cutting Permission is taken from CFS for FCL Shpt. Examination by Shed Appraiser

Examination Report is punched & print command given. 5 Copies of Bill of Entry & Examination Order is Printed & Signed by the Shed Appraiser CFS Charges are Paid & Delivery Taken

FIRST CHECK. Group Appraiser Disagrees with the Value/Custom Tariff Classification/Description of Goods, he issues First Check Examination Order & Bill of Entry is Printed Delivery Advice is collected from the Consol Dept. on Submission of the HBL Delivery Advice Submitted to the Shipping Co. Examination Delivery Order is Collected from the Shipping Co.

Shipment Received Order is taken from the CFS Forwarding is taken from the Shed Appraiser Sealing Cutting Permission is taken from CFS for FCL Shpt Examination by Shed Appraiser.Examination Report is punch in the Customs System & Bill of Entry forwarded to the Group Appraiser Group Appraiser Assess the Bill of Entry on the Basis of the Examination Report

Bill of Entry Passed by the Deputy Commissioner of Customs TR6 & Bill of Entry Print Out taken Customs Duty is Paid Bill of Entry & TR6 Submitted to the Shipping Co Shipping Co. Charges & 0.1% Stamp duty on Assessable Value + Customs Duty is paid & Delivery Order is Collected

Shed Appraiser is approached for Out Of Charge. 5 Copies of Bill of Entry & Examination Order is Printed & Signed by the Shed Appraiser CFS Charges are Paid & Delivery Taken

Mumbai Port 20’FCL 40 FCL THC Factory DestuffingINR 5060INR 7400 Docks Destuffing Non HazINR 9565INR Docks Destuffing HazINR10555INR JNPT PORT 20’FCL 40 FCL THC Factory Destuffing INR 3900 INR 5970 Docks Destuffing Non Haz INR 6395 INR Docks Destuffing Haz INR 6945 INR 11670

Delivery Order ChargesINR 2000 PER HBL Washing Charges INR 450/- PER CONT. INR 900/- PER CONT. Survey Fees INR 350/- PER CONT 450/- PER CONT. LCL Rs. 750 Per Ton/Rs.450 Per CBM Container Detention charges 20’ feet First 5 days free US $ 8.50 Per Day/Per Cont. for 7 days there after US $ Per Day/Per Cont. for next 7 days US $ Per Day/Per Cont. for the next 7 days there after US $ Per Day/Per Cont. there after Double for 40’

Port Trust Charges if shipment arrived at Mumbai port First 6 Days Free INR 30/- Per Day/Per M.T for the first 20 days there after INR 45/- Per Day/Per M.T for the next 20 days. INR 60/- Per Day/Per M.T there after % wharfage on assessable value. CFS Charges JNPT port Ground Rent 1 st to 7 th DayINR 150/- Per Day/Per TEU 8 th to 15 th DayINR 250/- Per Day/Per TEU 16 th to 30 th DayINR 500/- Per Day/Per TEU 31 st Day on wardsINR 650/- Per Day/Per TEU

LCL First 4 weeksINR 75/- Per week/Per CBM (Minimum 5 CBM) There afterINR 90/- Per week/Per CBM (Minimum 5 CBM) Bonded Cargo First 4 weeks INR 85/- Per week/Per CBM (Minimum 5 CBM) There after INR 100/- Per week/Per CBM (Minimum 5 CBM) Handling Charges INR 70/- Per M.T..

Channel Design & Management Do your channel partners proactively search out your prospective customers and have the skills needed to close the business? Do your channel partners have the reach you need to fully participate in your chosen markets? Does your solution form a strategic part of your partners business? How quickly can you recruit effective new partners? How do you minimize channel conflicts without reducing market coverage? What performance data will you need to collect from the channel and how? How will you use your performance data to enhance the effectiveness of your channel partners and create a better service for your customers? Which partner programs will work for you and which won’t

CASE STUDY