domestic cargo service

Upload: ashish-menon

Post on 06-Apr-2018

220 views

Category:

Documents


0 download

TRANSCRIPT

  • 8/3/2019 Domestic Cargo Service

    1/75

    EXECUTIVE SUMMARY

    1

  • 8/3/2019 Domestic Cargo Service

    2/75

    EXECUTIVE SUMMARY

    The general purpose of this study is to understand the basic requirements ofdifferent companies for domestic movement of cargo i.e. the mode of

    transport they use for movement of cargo, the type of service they require,

    their major destination lanes and the shipment volumes and the various

    problems they currently face to manage the entire process of transportation.

    India is being touted as the land of opportunity for logistics service

    providers all over the world. Logistics management in India has become

    complex, with about ten million retail outlets to cater to the needs of one

    billion people.

    The study will also help us build a network of routes in and around Kolkata

    for DOMESTIC CARGO SERVICES in Expeditors. Basically Covering seven

    sisters i.e. the north eastern states. The study will help in approximation of

    cost and time of each shipment and thus improving the services. A network

    would be developed and various factors would be considered while selecting

    an office location for DCS in KOLKATA.

    The sample size for this research is 90. A set of questions would be

    developed and administered to the sample population. The question would

    be administered through telephonic conversation.

    2

  • 8/3/2019 Domestic Cargo Service

    3/75

    Sr.no Contents

    Pg.No.

    1 Introduction 6

    a. Logistics outlook in India 9

    b. Investments in Logistics sector 9

    c. Pitfalls and Challenges 10

    d. Need for Integration 12

    e. Outsourcing Logistics services-A growing Trend 13

    2 Third Party Logistics 14

    a. Overview 14

    b. Advent and Growth of 3PL market in India 14

    c. Factors that are driving Indian Logistics towards3PL

    15

    3 Objectives 16

    4 Research Methodology 18

    5 Conceptual Framework 20

    6 About Expeditors 23

    7 SWOT Analysis of Expeditors 29

    8 Kolkata Network 31

    9 Data Analysis 37

    10 Findings 53

    11 Conclusion 61

    12 Suggestion 64

    13 Limitation 67

    14 Bibliography 69

    15 Annexure 71

    3

  • 8/3/2019 Domestic Cargo Service

    4/75

    INTRODUCTION

    4

  • 8/3/2019 Domestic Cargo Service

    5/75

    INTRODUCTION

    The Logistics Industry

    Globally, the logistics industry is valued at US$ 3.5 trillion.

    The U.S., which contributes to over 25% of the global industry value,

    spends close to 9% of its GDP on logistic services.

    The Indian Logistics Industry is presently estimated at US$ 90 billion.

    (CII)

    The industry has generated employment for 45 million people in the

    country in comparison with the IT and ITES sector which employs

    approximately 4.3 million People.

    It is forecast to grow at a Compound Annual Growth Rate (CAGR) of

    Approximately 8% over the next three to five years. (CII)

    Third Party Logistics (3PL) Solutions, is slated to grow at a compound

    Annual growth rate (CAGR) of over 16% from 2007-10. Consequently,

    3PL service providers are expected to corner an increased share of the

    Indian Logistics pie, from 6% in FY06 to 13% in FY11, at a CAGR of

    25% (CII).

    The primary growth drivers of this industry are as under:

    Investments in the infrastructure sector amounting to US$ 350 billion:

    o Increased efficiency and productivity of the transport system

    would result in lower transit times.

    Streamlining of the indirect tax structure:

    o The introduction of Value Added Tax (VAT) and the proposed

    introduction of a singular Goods and Services Tax (GST) are

    5

  • 8/3/2019 Domestic Cargo Service

    6/75

    expected to significantly reduce the number of warehouses

    manufacturers are required to maintain in different states,

    thereby resulting in a substantial increase in demand for

    integrated logistics solutions.

    Robust trade growth

    o Strong economic growth and liberalization have led to

    considerable increase in domestic and international trade

    volumes over the past five years. Consequently, the requirement

    for transportation, handling and warehousing is growing at a

    robust pace and is driving the demand for integrated logistics

    solutions.

    Globalization of manufacturing systems

    o Globalization of manufacturing systems coupled with

    advancements in technology are increasingly compelling

    companies across verticals to concentrate on their core

    competencies and avail the cost saving potential of outsourcing.

    This is expected to contribute to an increase in the need for

    integrated logistic solutions, which is the niche of every Third

    Party Logistics Service (3PL Services) provider.

    The industry has been valued at US$ 125 billion in 2010. (CII)

    A snapshot of the FDI regulations governing the industry is as under:

    i. 100% FDI under the automatic route is permitted for all logistic

    services except services mentioned in points ii and iii below.

    ii. FDI up to 100% subject to FIPB approval is permitted for courier

    services.

    iii. FDI up to 49% under the automatic route is permitted for air

    transport services, including air cargo services. It is pertinent to mention in

    this context, that Press Note 1 (2007) that is expected to be imminently

    6

  • 8/3/2019 Domestic Cargo Service

    7/75

    notified by the DIPP proposes to increase the limit of FDI on air cargo

    services in 74%.

    The industry has been at the receiving end of increasing interest from

    the private equity sector. The year 2007 witnessed just under US$ 1

    billion in private equity investments in this industry, representing

    approximately 7% of total private equity investments during the year,

    against 3% in the previous year.

    Logistics outlook in India

    India spends about 13.0 percent of its total Gross Domestic Product (GDP) on

    logistics, as per 2005 estimates. The major logistics functions for the Indianindustries include

    Transportation

    Warehousing

    Freight Forwarding, and other Value Added Operations including

    Management of Information Systems (MIS).

    Nevertheless, the logistics industry, providing services to fulfill these major

    logistics needs of the Indian industries is highly fragmented. Thetransportation service provider segment is completely dominated by small

    trucking companies and individual truckers. The freight forwarding service

    provider segment is also represented by thousands of small customs brokers

    and clearing & forwarding agents. Similarly, there are a huge number of

    participants in the warehousing service segment and MIS service segment

    also. Few service providers have the capability to provide more than one

    service and it is very rare that a single service provider has the capability to

    provide all the logistics services. Such fragmentation had lead Indian

    industries to outsource packets of individual logistics functions to different

    service providers while retaining the overall control of logistics in-house,

    despite incurring heavy administrative and infrastructural costs.

    7

  • 8/3/2019 Domestic Cargo Service

    8/75

    Huge Investments in Logistics Sector

    Indias logistics sector attracted investments worth Rs. 23,200 crore in

    first half of 2008.

    It outclassed some of the major sectors including aviation (Rs 20,890

    crore), metals and mining (Rs 8500 crore) and consumer durables (Rs 6000

    crore) among others.

    Delhi has emerged as the preferred location for the development of

    logistics parks with an investment of approximately $ 200 million.

    A large number of upcoming SEZs have necessitated the development

    of logistics for the domestic market as well as for global trade.

    Indian logistics industry is expected to grow annually at the rate of 15-

    20 percent, reaching revenues of approximately $ 385 bn by 2015.

    Market share of organized logistics players is also expected to double

    to approximately 12 percent during the same period.

    About 110 logistics parks spread over approximately 3,500 acres at an

    estimated cost of $1 bn are expected to be operational and an estimated 45

    mn ft2 of warehousing space with an investment of $ 500 mn is expected tobe developed by various logistics companies by 2012.

    Pitfalls and challenges

    The Indian logistics industry suffers from inadequate infrastructure, complex

    tax laws and insufficient technological aids.

    In India, around 65% of goods are transported by road. In respect of the road

    transport sector, vehicle ownership is firmly in the hands of individual truck

    owners, 67% of whom have fleets of less than five vehicles.

    A fragmented market increases paperwork costs and efforts required to

    channel resources. The poor condition of roads translates directly to higher

    vehicle turnover, which increases operating costs and reduces efficiency.

    8

  • 8/3/2019 Domestic Cargo Service

    9/75

    These inefficiencies are passed on to the logistics industry, with

    transportation costs accounting for nearly 40% of logistics costs.

    As the average fleet size is small, individual truck owners are unable to

    contract their vehicles directly to companies, and thus freight consolidators

    and brokers take a commission to provide truck owners with consignments.

    Truck owners lack the bargaining power necessary for negotiating prices,

    and provide transportation services at minimum profit. Increasing costs and

    dwindling profits affect truck owners ability to upgrade and expand their

    fleets.

    In India, logistics costs are still higher than those in developed markets it is

    estimated to be around 13% of the GDP, compared with 8% in the US.

    Transportation costs account for nearly 40% of production costs.

    Inventory carrying costs account for approximately 24% of logistics costs,

    and order processing and administrative costs account for a significant 10%.

    Stock filing and warehouse management is, in many cases, done manually,

    which increases administrative costs and adds an element of inefficiency.

    The three major hurdles faced by Indias logistics industry are insufficient

    knowledge and under-exposure of logistics solution providers, inadequateinfrastructure, and ineffective usage of information technology.

    Lack of an integrated transport policy has hampered growth of the logistics

    sector in India. The major problem is the road transport sector, which,

    despite being a major link in the system, does not enjoy industry status.

    Consequently, road transport operators do not have access to low-interest

    funds.

    India needs to invest in railways, which are environmentally friendly and the

    most cost effective system. Inland waterways, neglected over the years, are

    to be developed as well, pointed out MP M Menon, former Indian

    ambassador to Brazil.

    A characteristic feature of the industry structure in India, particularly in the

    express and logistics segments, is the many players offering homogenous

    9

  • 8/3/2019 Domestic Cargo Service

    10/75

    services. Consequently, there is near-commoditization of services, especially

    in the express document business where demand is price-sensitive. The top

    end of the market is controlled by a handful of multi-nationals and large

    domestic players. Industry consolidation is, however, starting to occur.

    DHL has acquired local express major Blue Dart Express and, in the port

    terminal business, Maersk and P&O Ports have consolidated their position by

    acquiring controlling stakes in private container terminals in Gujarat. The

    pace of mergers and acquisitions will most certainly develop in the years to

    come as the market is progressively liberalized.

    Need for integration

    There is a vital need for integration so that our customers can achieve their

    transportation requirements while maximizing the value of money spent in

    getting their goods to market. This requires better use of existing assets and

    industry cooperation, and greater competition. Companies aiming to be an

    integrated solutions provider have to tackle this by extending their supply

    chain capabilities.Every point of service along the chain must have the capacity for cargoes to

    flow through efficientlyat the lowest cost and greatest velocityor it will

    become a bottleneck and has a cost or time impact on customers. Having

    bigger ships may ease the shortage of space at sea, but shift the pressure

    on to the next point in the chain.

    The global transportation companies of tomorrow must be able to offer

    highly integrated and flexible solutions that take into account the increasing

    cyclicality and volatility in operations across industries. This is making

    companies vulnerable to interruptions in their supply lines.

    New technologies such as RFID, standardized data processing formats and

    new supply chain tools and e-commerce capabilities will, undoubtedly, open

    up new ways to mange movement and storage of goods

    10

  • 8/3/2019 Domestic Cargo Service

    11/75

    Outsourcing logistics services a growing trend

    Usage of 3PL services

    The TCI-MDI survey showed that the benefits of outsourcing logistics

    activities range from improved delivery schedules and reduced operating

    costs to expanded geographic reach and improved operational flexibility.

    The study also showed that less than 55% of Indian companies subscribe to

    3PL services, compared to more than 75% globally, which implies potentially

    brisk market growth.

    Logistics service providers face the same set of external challenges as

    companies. However, logistics service providers have an inherent flexibility

    to overcome external challenges such as managing multi-modal

    transportation and compliance with regulatory requirements and agencies.

    Internal factors that need to be addressed are those likely to have a high

    impact on the level of outsourcing, such as the customers costs in relation

    to the benefits, and the control that needs to be exercised on the logistics

    service provider. With Indian companies increasing focus on exports,

    superior logistics planning is crucial in order to remain competitive.

    11

  • 8/3/2019 Domestic Cargo Service

    12/75

    THIRD PARTY LOGISTICS

    Overview

    Third Party Logistics (3PL), the concept of a single professional logistics

    service provider managing the entire logistics functions of a company, had

    originated in the developed economies of Europe and America, to relieve

    industries from huge logistics costs apart from the hassles of dealing with

    multiple in-coherent logistics service providers. It proved to be immensely

    successful in improving logistics efficiency of majority of industries and

    quickly gained popularity, spreading across the globe.

    In the initial stages, 3PL providers offered only basic logistics services such

    as warehousing and transportation. But with growing logistics needs of

    organizations to remain competitive in globalized economies, 3PL providers

    have evolved to offer several other value added services ranging frompackaging to supply chain planning.

    3PL Market in India Poised for a Remarkable Growth

    The 3PL market in India is still in a relatively nascent stage, with

    multinational companies in all industries being the predominant users of

    these services. However, domestic major companies in leading industry

    sectors have also begun to follow the footsteps of their multinational

    counterparts, starting with outsourcing their basic logistics functions.

    Nevertheless, considering that the most important logistics functions for

    Indian industries still are transportation and warehousing, which are likely to

    be outsourced to 3PL in increasing share, a high level of growth is estimated

    12

  • 8/3/2019 Domestic Cargo Service

    13/75

    for the Indian 3PL market in the next 5-7 years. The Indian 3PL market,

    estimated at about US$890.3 billion in 2005, is expected to grow at a

    compound annual growth rate of 21.9 percent to reach US$3,556.7 million in

    2012.

    A Few Challenges to be addressed for maintaining the Momentum

    Geographic diversity of India needing varied logistics expertise for each

    region is a major challenge to be addressed by 3PL service providers. India

    has a diverse geographic scenario coupled with a diverse consumer habit

    scenario in each of its 25 states. Logistics operation in each state requires a

    suitable model that facilitates the effective storage and transportation of

    goods mostly sold in that state, making it very difficult for adopting a

    uniform logistics model. 3PL service companies interested in serving a

    particular company would have to offer multiple solutions to fulfill the

    nationwide logistics needs of that company.

    Infrastructure limitations in India, which limit the scope of logistics services

    package are another concern for 3PL service providers.

    The complicated tax structure, deep-rooted corruption and high bureaucraticcontrol are some other hassles faced by 3PL service providers in providing

    the best of logistics solutions for their clients. However, despite the

    existence of challenges, several factors are driving the growth of Indian 3PL

    market.

    Some Factors that are Driving Indian Logistics towards 3PL

    Value Added Tax (VAT), the Indian Governments proposed uniform tax

    regime, is expected to drive Indian industries towards using more 3PL

    services. Introduced partially in 2005, a full implementation of this regime is

    expected to necessitate having centralized large warehouses in regional hub

    cities, to achieve best efficiency in logistics.

    13

  • 8/3/2019 Domestic Cargo Service

    14/75

    The Indian 3PL market is set to grow tremendously in the next 5-7 years,

    spearheading the growth of logistics market. Several factors including

    governments support are instrumental in this growth.

    OBJECTIVES

    14

  • 8/3/2019 Domestic Cargo Service

    15/75

    I. Primary Objective:-

    SectorWise Analysis for Domestic Movement of

    Cargo

    II. Secondary Objectives:-

    1. Comparative analysis on the basis of

    select factors.

    2. Comparative Evaluation of Expeditors

    performance with its competitors

    3.SWOT Analysis of Expeditors.

    15

  • 8/3/2019 Domestic Cargo Service

    16/75

    RESEARCHMETHODOLOGY

    16

  • 8/3/2019 Domestic Cargo Service

    17/75

    Research Methodology

    (EXPLORATORY AND SECONDARY DATA COLLECTION AND ANALYSIS)

    Exploratory research is a type of research conducted for a problem that

    has not been clearly defined. Exploratory research helps determine the best

    research design, data collection method and selection of subjects. It should

    draw definitive conclusions only with extreme caution. Given its fundamental

    nature, exploratory research often concludes that a perceived problem does

    not actually exist.

    Exploratory research often relies on secondary research such as reviewing

    available literature and/or data, or qualitative approaches such as informal

    discussions with consumers, employees, management or competitors, and

    more formal approaches through in-depth interviews, focus groups,

    projective methods, case studies or pilot studies. The Internet allows for

    research methods that are more interactive in nature.

    The main data analysis tools used will be:

    1. Editing:

    The process includes the review of the data to ensure maximum accuracy

    and unambiguity. Careful editing early in collection process will often catch

    misunderstanding of instructions, errors in recording and other problems at a

    stage when it is still possible to eliminate them from the later stages of the

    study.

    2. Coding:

    The process includes careful interpretation and good judgment of the data to

    ensure that the meaning of the response and the meaning of the category

    are consistently and uniformly matched.

    17

    http://en.wikipedia.org/wiki/Researchhttp://en.wikipedia.org/wiki/Researchhttp://en.wikipedia.org/wiki/Data_collectionhttp://en.wikipedia.org/wiki/Secondary_researchhttp://en.wikipedia.org/wiki/Focus_grouphttp://en.wikipedia.org/wiki/Case_studieshttp://en.wikipedia.org/wiki/Pilot_studieshttp://en.wikipedia.org/wiki/Internethttp://en.wikipedia.org/wiki/Researchhttp://en.wikipedia.org/wiki/Researchhttp://en.wikipedia.org/wiki/Data_collectionhttp://en.wikipedia.org/wiki/Secondary_researchhttp://en.wikipedia.org/wiki/Focus_grouphttp://en.wikipedia.org/wiki/Case_studieshttp://en.wikipedia.org/wiki/Pilot_studieshttp://en.wikipedia.org/wiki/Internet
  • 8/3/2019 Domestic Cargo Service

    18/75

    The main data analysis tools used will be:

    Software: Excel

    TABULATION: The data will be tabulated using excel spread sheet. Analysis

    will also be done using the same.

    CONCEPTUAL

    FRAMEWORK

    18

  • 8/3/2019 Domestic Cargo Service

    19/75

    I. Domestic Cargo Services Time Definite Solutions

    International Logistics is the designing and managing of a system that

    controls the flow of materials into, through, and out of the international

    corporation. Domestic logistics is designing and managing of a system

    within a country for control of flow of materials. Globally, the logistics

    industry is valued at US$ 3.5 trillion. The Indian Logistics Industry is

    presently estimated at US$ 90 billion (CII) which gives employment to 45million people.

    Difference between Domestic & International Logistics can be said to

    arise mainly on account of the three major factors:

    Logistic costs is International Business is much more higher than the

    domestic business,

    The Logistic Mechanics are much more complex in the context of

    international logistics than the domestic logistics,

    The political, cultural and institutional factors connected with

    international logistics are of considerable importance whereas these

    are usually not of much consequence in the context of domestic

    logistics.

    As a leader in global supply chain solutions, Expeditors provides domestic

    and transcontinental freight services via air or ground, throughout the

    Americas, the European Continent, and Asia.

    Whether your needs are urgent or specialized - Expeditors will provide a cost

    effective, flexible set of logistics options to keep your cargo visible and

    moving in the supply chain.

    19

  • 8/3/2019 Domestic Cargo Service

    20/75

    Shippers expect delivery methods that are flexible yet guaranteed. Our

    service options are designed to give our customers earlier arrivals and later

    cut times to increase velocity within your logistics network. Tap into our

    integrated network with state of art technology and a highly trained and

    incentified work force.

    1. Strategy and Services

    Our strategy is simple - by leveraging our global network, systems and

    established portfolio of products, we can provide a seamless transition for

    customers within land continent areas of their supply chain.

    Expeditors has developed a powerful network of key cargo air and surface

    carriers that offer the most consistent transit and largest lift options giving

    us flexibility in both space allocation and pricing.

    2. Shipment Visibility

    Information is a key component of successful partnering, so we give you

    direct access to your purchase orders, your vendors' inventory and pipeline

    visibility with the click of a button.

    Expeditors' proprietary track and trace tool available online to all customers.

    In addition, customers can use edoc to convert hard copies of documents

    into digital format, where they can be easily shared and archived for

    retrieval later. With these applications, customers can analyze their supply

    chain with a host of reporting

    20

  • 8/3/2019 Domestic Cargo Service

    21/75

    COMPANY

    21

  • 8/3/2019 Domestic Cargo Service

    22/75

    EXPEDITORS

    Expeditors International is an American global logistics and freight

    forwarding company.

    Expeditors has 255 locations worldwide as of November 11, 2008

    providing staff of over 12,000 who satisfy the needs of international

    trade using integrated information systems.

    Core Assets

    1. People

    By recruiting, motivating and retaining the best personnel in the business,

    we feel we will keep our leadership position in the marketplace. Our business

    is quality customer service and our people are what make that happen. We

    hire individuals based on attitude, and we train the skills it takes to make a

    successful career here. Expeditors' employees, as part of their overall job

    evaluation, are required to take a minimum of 52 hours per year, of in-house

    training. Multiple on-going training classes are available at any one time

    within each Expeditors office location.

    2. Systems

    Expeditors takes control of our destiny by taking control of our systems

    direction. Moving information in a timely and accurate method is just as

    important as moving the goods and our systems support our operations

    teams and our customers in providing them the data they need to

    22

  • 8/3/2019 Domestic Cargo Service

    23/75

    successfully manage the movement of their goods. All of our global offices

    are linked via high-speed lines using the same hardware and running off of

    the same transportation software. This drives global standardization with

    timely and accurate communication. We are the leader in the systems arena,

    and we are continuing to invest in this critical area.

    3. Culture

    We believe that successful companies have a unique culture, and they work

    hard to protect that culture. At Expeditors our culture is about exceeding our

    customers expectations and providing a place for our employees to make a

    career and do well for themselves. Our environment breeds success, and you

    will notice that our people move faster, work harder and are better rewarded

    than our competition. Our offices are neat, organized and set up in

    accordance with our quality policies. We are a process driven organization

    that focuses on continual improvement. It's a simple philosophy that works.

    We will do all we can to protect our culture.

    4. Customers

    Our financial success is directly related to our client retention. We have the

    smallest sales staff in the industry and put more emphasis on taking care of

    our existing clients than going out and getting new business. We feel that if

    we partner with the right clients our business will grow with these

    customers, and our reputation will support our sales staff in obtainment of

    new partners. We have initiated some very successful programs to support

    our existing clients including:

    23

  • 8/3/2019 Domestic Cargo Service

    24/75

    Services Offered

    1. Air

    As a global leader in air consolidation and forwarding, Expeditors provide customer-specific

    airfreight programs to shippers of all sizes.

    As an IATA agent for all major airlines, Expeditors provide a complete package of air logistics

    services through their global network of experienced professionals and state of the art trackingtechnology.

    2. CustomsWith the current emphasis on free trade agreements and global sourcing,

    Customs issues have assumed an increasingly important role in the supply

    chain. Expeditors global Customs services focus on the compliance, release,

    and reporting needs of the marketplace, which they refer to as the "Customs

    value stream."

    Supported by advanced technology, streamlined processes, and the best

    people in the industry, they continue to introduce new services and

    products, assisting clients in managing their global customs "value stream."

    While many companies offer international customs services, Expeditors has

    a global vision of our clients' logistics and customs needs. Whether your

    needs are transaction clearance services or professional services, Expeditors

    and its subsidiary Tradewin, LLC can deliver.

    Compliance Driven Processes:

    Expeditors network operates under standardized pro.

    24

  • 8/3/2019 Domestic Cargo Service

    25/75

    cesses which are continually validated, measured, analyzed and

    reviewed.

    They strive for the most efficient processes, aligned with customer

    requirements, and using the best combination of human effort and

    intelligence, and advanced technology.

    Their goal is that processes optimize the entire customs value stream.

    Compliance information is a key input to the release process, and

    we're focused on it flowing smoothly and accurately.

    They emphasize minimizing the time involved in the release process,

    so their customer's overall supply chain processes are not obstructed.

    In a supply chain process, any "waiting" time is a waste, and they are

    focused on eliminating waste.

    3. Distribution

    Expeditors provide a comprehensive, flexible spectrum of distribution and

    warehousing services that are available throughout their global network.

    Leading-edge information technology and connectivity offers real-time

    visibility to inventory. This combination of coverage and technology offers

    seamless control over a global supply chain.

    4. Insurance

    Transportation Risk Analysis Center at Expeditors - TRACE

    The Transportation Risk Analysis Center at Expeditors (TRACE)

    provides users with tools to manage transit related risks.

    Cargo Insurance is a critical part of the International transportation

    process. Most insurance providers do not have access to logistics data

    and more importantly, do not understand global transportation, which

    makes it difficult to assess the risk and make accurate

    recommendations. Expeditors goal is to identify the hidden risks in

    25

  • 8/3/2019 Domestic Cargo Service

    26/75

    transportation, and to structure an insurance program addressing

    those risks while providing financial security. Expeditors goes beyond

    basic business insurance and treats cargo insurance as part of the

    complete logistics process.

    Expeditors employs a full staff of trained, professional claims adjustors

    who will handle all claims anywhere in the world. The claims team is

    one of the largest cargo only claims departments in North America,

    and is here specifically to address our insured customers needs. They

    conduct comprehensive analysis and investigation, assemble all formal

    documentation and accurately process claims at both origin and

    destination. Additionally, Expeditors handles all recoveries from the

    responsible transportation carriers. More money recovered means

    more bottom-line insurance savings for our customers.

    When claims do arise, Expeditors has developed specific logistics claims

    software to manage them. This allows them to use numerous measurement

    tools and reporting mechanisms, designed to assist in efficient and accurate

    resolution for their customers.

    5. Ocean

    Expeditors is a licensed Ocean Transportation Intermediary (OTI) and NVOCC

    and is uniquely positioned to handle all aspects of shipment from launch to

    catch. They offer a full array of ocean related services including Ocean

    Forwarding, NVOCC Consolidation or FCL container management as well as

    customer-in-house services.

    Expeditors can offer a single-source solution to and from any point

    worldwide keeping their customers informed of their shipment status at

    every step.

    26

  • 8/3/2019 Domestic Cargo Service

    27/75

    6. Order Management

    Through Order Management exp.o, Expeditors Web based tracking

    application, any attribute of an order can be tracked, completely visible on

    the Web. Item quantities, required ship dates, commodity description and

    estimated vs. actual ex-factory dates along with the complete process are

    managed in e.tms, our operational system, and made available via Order

    Management exp.o from the time the order is placed.

    SWOT Analysis of Expeditors

    Strengths:

    Good user-friendly systems that enables their employees to

    provide real time information to the customers.

    Expertise in services like freight forwarding, order processing

    and other related services.

    Presence of SOP in the process that provides personalized

    service for individual customers.

    A large customer base that is already aware of the companys

    image.

    Well-informed and motivated employees.

    Weaknesses:

    Lack of experience in the domestic market.

    Lack of knowledge about the wants of the companies in different

    industries for domestic movement of cargo.

    Opportunities:

    3PL service in India is still at its nascent stage and there is a

    huge demand for good 3PL service providers owing to

    27

  • 8/3/2019 Domestic Cargo Service

    28/75

    remarkable growth of the Indian economy especially in

    manufacturing and retail sector.

    India is one of the country which has a huge domestic

    consumption owing to the population of more than one billion

    people which further puts pressure on logistics company to

    provide efficient service and wide geographic reach.

    Threats:

    The Indian logistics industry suffers from inadequate

    infrastructure, complex tax laws and insufficient technological

    aids.

    Dominance of unorganized sector in domestic movement of

    cargo.

    A fragmented market increases paperwork costs and efforts

    required to channel resources.

    The poor condition of roads translates directly to higher vehicle

    turnover, which increases operating costs and reduces

    efficiency.

    28

  • 8/3/2019 Domestic Cargo Service

    29/75

    KOLKATA NETWORK

    WEST BENGAL

    29

  • 8/3/2019 Domestic Cargo Service

    30/75

    PRIMARY TRANSIT

    WestBengalS.No Destination Destination Distance in Transit time Rail Air Remarks

    30

  • 8/3/2019 Domestic Cargo Service

    31/75

    A B kms road Link link

    1 Kolkata Asansol 228 4hrs N\A N\A

    2 Kolkata Jhargram 170 3hrs N\A N\A

    3 Kolkata Durgapur 187 4hrs N\A N\A

    4 Kolkata Purulia 250 5hrs Yes N\A5 Kolkata Bankura 180 4hrs Yes N\A

    6 Kolkata Hirapur 235 5hrs Yes N\A

    7 Kolkata Nanoor 200 4hrs N\A N\A

    8 Kolkata Siuri 230 4hrs N\A N\A

    9 Kolkata Maldah 351 7hrs Yes YesRail link notdirect

    10 KolkataEnglishBazaar 350 7hrs N\A N\A

    11 Kolkata Balurghat 460 9hrs N\A Yes

    12 Kolkata Raiganj 420 8hrs Yes N\ARail link notdirect

    13 Kolkata Jalpaiguri 700 12hrs Yes N\A Rail link notdirect

    14 Kolkata Darjeeling 731 13hrs Yes N\ARail link notdirect

    15 Kolkata Bagdogra 670 11hrs N\A Yes

    16 KolkataCoochBehar 805 13hrs N\A Yes

    17 Kolkata Panagarh 200 4hrs Yes Yes

    18 Kolkata Siliguri 678 11hrs Yes N\A

    SECONDARY TRANSIT (WITHIN 130 KMS)

    S.NoDestinationA Destination B

    Distance inkms

    Transit timeroad

    RailLink

    Airlink Remarks

    1 Kolkata Kharagpur 127 2hrs N\A N/A

    2 Kolkata Haora 21 21 mins N\A N/A

    3 Kolkata Alipur 8 15 mins N\A N/A

    4 Kolkata Jagatballabhpur 36 52 mins N\A N/A

    5 Kolkata sonarpur 25 35 mins N\A N/A

    6 Kolkata Bishnupur 27 35 mins N\A N/A

    7 Kolkata Barasat 23 35 mins N\A N/A

    8 Kolkata Maheshtala 23 40 mins N\A N/A

    9 KolkataRajarhatGopalpur 19 30 mins N\A N/A

    10 Kolkata Howrah 16 30 mins N\A N/A

    11 KolkataBotanicalGarden 16 30 mins N\A N/A

    12 Kolkata Dum Dum 8 15 mins N\A N/A

    13 Kolkata Sukantapally 15 30 mins N\A N/A

    14 Kolkata Barrackpore 27 40 mins N\A N/A

    15 Kolkata Chandannagar 44 1hr N\A N/A

    16 KolkataHooghly-Chinsurah 61 1hr N\A N/A

    31

  • 8/3/2019 Domestic Cargo Service

    32/75

    17 Kolkata Kanchrapara 47 1hr N\A N/A

    18 Kolkata Bantala 15 30 mins N\A N/A

    19 Kolkata Raipur 37 1hr N\A N/A

    20 Kolkata Kulgachia 50 1hr N\A N/A

    21 Kolkata Magrahat 56 1hr N\A N/A22 Kolkata Medni pur 126 2hrs N\A N/A

    23 Kolkata Narajole 116 2hrs 14 mins N\A N/A

    24 Kolkata Haldia 120 2hrs 14 mins N\A N/A

    25 Kolkata Gaighata 120 2hrs 14 mins N\A N/A

    26 Kolkata Jirat 71 1hr 30 mins N\A N/A

    27 Kolkata Chakdaha 75 1hr 30 mins N\A N/A

    28 Kolkata Chapra 128 2hrs 28 mins N\A N/A

    29 Kolkata Nabadwip 118 2hrs 14 mins N\A N/A

    30 Kolkata Debra 96 1hr 30 mins N\A N/A

    31 Kolkata Kakdwip 88 1hr 40 mins N\A N/A

    32 Kolkata Bardhaman 124 2hrs N\A N/A

    33 Kolkata Chunchura 62 1hr 10 mins N\A N/A

    KOLKATA TO JHARKHAND

    JHARKHAND JHARKHAND

    S.NoDestinationA Destination B

    Distance inkms

    Transit timeroad

    RailLink

    Airlink Remarks

    1 Kolkata Ranchi 420 7hrs Yes Yes

    2 Kolkata Jamshedpur 300 5hrs Yes N\A

    3 Kolkata Tamar 358 6hrs Yes N\A

    4 Kolkata Lohardaga 480 8hrs Yes N\A

    5 Kolkata Bokaro 300 6hrs N\A N\A

    6 Kolkata Dhanbad 300 5hrs N\A N\A

    7 Kolkata Hazaribagh 408 6hrs N\A N\A

    8 Kolkata Dumka 300 5hrs N\A N\A

    9 Kolkata Pakur 322 5hrs N\A N\A

    10 Kolkata Godda 370 6hrs Yes N\A

    11 Kolkata Sahibganj 420 7hrs Yes N\A

    12 Kolkata Giridih 332 6hrs Yes N\A

    13 Kolkata Koderma 440 7hrs N\A N\A

    14 Kolkata Chatra 470 8hrs N\A N\A15 Kolkata Garwah 622 10hrs Yes N\A

    BIHAR

    BIHAR BIHAR

    S.NoDestinationA

    DestinationB

    Distance inkms

    Transit timeroad

    RailLink

    Airlink Remarks

    32

  • 8/3/2019 Domestic Cargo Service

    33/75

    1 Kolkata Patna 622 10hrs Yes Yes

    2 Kolkata Banka 380 6hrs N\A N\A

    3 Kolkata Bhagalpur 410 7hrs N\A N\A

    4 Kolkata Jamui 475 8hrs Yes N\A

    5 Kolkata Katihar 453 8hrs Yes N\A

    6 Kolkata Purnia 500 8hrs Yes N\A

    7 Kolkata Luckeesarai 500 8hrs N\A N\A

    8 Kolkata Begusarai 536 9hrs N\A N\A

    9 Kolkata Sheikhpura 524 9hrs N\A N\A

    10 Kolkata Nawada 478 8hrs N\A N\A

    11 Kolkata Gaya 528 8hrs Yes Yes

    12 Kolkata Aurangabad 580 9hrs Yes N\A

    13 Kolkata Sasaram 620 9hrs Yes N\A

    14 Kolkata Bihar Sharif 514 8hrs Yes N\A

    15 Kolkata Jahanabad 580 9hrs Yes N\A

    16 Kolkata Madhepura 510 8hrs N\A N\A17 Kolkata Saharsa 544 9hrs Yes N\A

    18 Kolkata Samastipur 610 10hrs N\A N\A

    19 Kolkata Hajipur 600 10hrs Yes N\A

    20 Kolkata Chhapra 658 11hrs Yes N\A

    21 Kolkata Buxar 711 11hrs Yes N\A

    22 Kolkata Madhubani 662 11hrs Yes N\A

    23 Kolkata Darbhanga 652 10hrs Yes N\A

    24 Kolkata Muzaffarpur 652 10hrs Yes N\A

    25 Kolkata Siwan 722 12hrs N\A N\A

    26 Kolkata Shivhar 715 11hrs N\A N\A

    27 Kolkata Sitamarhi 724 12hrs Yes N\A28 Kolkata Gopalganj 740 12hrs N\A N\A

    29 Kolkata Bettiah 763 12hrs N\A N\A

    30 Kolkata Motihari 735 12hrs N\A N\A

    SIKKIM

    SIKKIM SIKKIM

    S.NoDestinationA

    DestinationB

    Distance inkms

    Transit timeroad

    RailLink

    Airlink Remarks

    1 Kolkata Gangtok 786 13hrs N\A N\A2 Kolkata Namchi 761 13hrs N\A N\A

    3 Kolkata Mangan 820 14hrs N\A N\A

    ASSAM

    ASSAM ASSAMS.No Destination Destination B Distance in Transit time Rail Air Remarks

    33

  • 8/3/2019 Domestic Cargo Service

    34/75

    A kms road Link link

    1 Kolkata Kokrajhar 900 15hrs Yes N\A

    2 Kolkata Goalpara 978 16hrs Yes N\A

    3 Kolkata Bongaigaon 922 15hrs Yes N\A

    4 Kolkata Barpeta 985 16hrs N\A N\A5 Kolkata Nalbari 1030 17hrs Yes N\A

    6 Kolkata Dispur 1110 18hrs Yes N\A

    7 Kolkata Guwahati 1110 18hrs Yes Yes

    8 Kolkata Tezpur 1200 20hrs Yes Yes

    9 Kolkata Silchar N\A 22hrs N\A N\A

    10 Kolkata Dimapur 1400 23hrs Yes Yes

    11 Kolkata Jorhat 1400 22hrs Yes N\A

    12 KolkataNorthLakhimpur 1400 22hrs Yes Yes

    13 Kolkata Dibrugarh 1400 24hrs Yes Yes

    14 Kolkata Tinsukia 1527 24hrs Yes N\A

    ARUNACHAL PRADESH

    ArunachalPradesh

    ArunachalPradesh

    S.NoDestinationA Destination B

    Distance inkms

    Transit timeroad

    RailLink

    Airlink Remarks

    1 Kolkata Itanagar 1400 14hrs N\A N\A

    2 Kolkata Tawang 1433 24hrs N\A N\A

    3 Kolkata Bomdila 1264 21hrs N\A N\A

    4 Kolkata Seppa 1355 23hrs N\A N\A

    5 Kolkata Pasighat 1828 29hrs N\A Yes

    6 Kolkata Roing 1753 27hrs N\A N\A

    7 Kolkata Tezu 1685 26hrs N\A Yes

    NAGALAND

    Nagaland Nagaland

    S.NoDestinationA

    DestinationB

    Distance inkms

    Transit timeroad

    RailLink

    Airlink Remarks

    1 Kolkata Tuensang 1724 29hrs N\A N\A

    2 Kolkata Mokochung 1475 24hrs N\A N\A

    3 Kolkata Dimapur 1383 23hrs Yes N\A4 Kolkata Kohima 1445 24hrs N\A N\A

    5 Kolkata Phek 1509 26hrs N\A N\A

    MANIPUR

    Manipur Manipur

    34

  • 8/3/2019 Domestic Cargo Service

    35/75

    S.NoDestinationA

    DestinationB

    Distance inkms

    Transit timeroad

    RailLink

    Airlink Remarks

    1 Kolkata Imphal 1580 26hrs N\A Yes

    MIZORAM

    Mizoram Mizoram

    S.NoDestinationA

    DestinationB

    Distance inkms

    Transit timeroad

    RailLink

    Airlink Remarks

    1 Kolkata Aizwal 1800 29hrs N\A YesDistances areapproximates

    2 Kolkata Lunglei 1800 29hrs N\A N\ADistances areapproximates

    TRIPURA

    Tripura Tripura

    S.NoDestinationA

    DestinationB

    Distance inkms

    Transit timeroad

    RailLink

    Airlink Remarks

    1 Kolkata Agartala 1674 27hrs Yes Yes

    2 Kolkata Kailashahar 1600 27hrs N\A N\A

    MEGHALAYA

    Meghalaya Meghalaya

    S.NoDestinationA

    DestinationB

    Distance inkms

    Transit timeroad

    RailLink

    Airlink Remarks

    1 Kolkata Shillong 1196 20hrs N\A Yes

    2 Kolkata Tura 1077 18hrs N\A N\A

    3 Kolkata Jowai 1258 21hrs N\A N\A

    35

  • 8/3/2019 Domestic Cargo Service

    36/75

    DATA ANALYSIS

    SURVEY

    36

  • 8/3/2019 Domestic Cargo Service

    37/75

    Before doing the sector-wise analysis of the survey, we will study the major

    findings of the overall survey in brief.

    Total number of companies surveyed- 90

    The break-up of the industries covered are as follows:

    Monthly Expenses of all Companies Surveyed :

    Modes of Transport used by the companies are as follows:

    37

  • 8/3/2019 Domestic Cargo Service

    38/75

    The major destination lanes from Delhi are as follows:

    Type of services required by the companies are as follows:

    38

  • 8/3/2019 Domestic Cargo Service

    39/75

    Major problems faced by the companies with their current set of

    transporters are as follows:

    In case of imports, almost 80% of the time the decision on

    transportation is taken by CHA.

    39

  • 8/3/2019 Domestic Cargo Service

    40/75

    About 75% of the companies go for mutual consent while dealing with

    the change in fuel prices.

    The major locations for warehousing service other than Delhi are

    Hyderabad, Mumbai and Bangalore.

    SECTOR-WISE ANALYSIS

    1. Engineering Goods

    Total number of companies surveyed 22

    The break-up of the size of the companies visited based on their

    monthly expenditure on transportation can be shown as follows:

    Modes of Transport used by the companies are as follows:

    40

  • 8/3/2019 Domestic Cargo Service

    41/75

    Salient Features of the companies in this Industry are as follows:

    Dominance of Local Transporters for bulk cargo.

    For low weight consignments i.e. less than 100 Kgs, express cargo

    services are prominent.

    Shipment Tracking is one of the major problems faced by them.

    However, most of the companies are satisfied without proper co-ordination and tracking as they do not wish to pay a premium amount

    for the extra service.

    In case of heavy machinery that are used in industries, production is

    mostly based on orders; therefore they do not require warehousing

    services.

    The major destination lanes from Delhi are as follows:

    41

  • 8/3/2019 Domestic Cargo Service

    42/75

    Type of services required are as follows:

    Conclusion

    The industry looks moderately well in terms of volume. However, the

    major challenge would come from the low cost Local Transporters who

    are dominant from several years and have also started improving their

    service and offering certain added services like providing warehousing

    42

  • 8/3/2019 Domestic Cargo Service

    43/75

    service for few days without extra cost after sensing competition from

    the organized players. But, manufacturer of spare parts that are used

    in various industries for e.g. manufacturer of fasteners used in

    automotive industry can be targeted.

    2.Retail

    Total number of companies visited 15

    The break-up of the size of the companies visited based on their

    monthly expenditure on transportation can be shown as follows:

    Modes of Transport used by the companies are as follows:

    43

  • 8/3/2019 Domestic Cargo Service

    44/75

    Salient Features of the companies in this Industry are as follows:

    Transportation requirements are complex, as they require wide

    geographic reach and other value-added services.

    Dominance of organized players as they require integrated and

    customized services like order processing, proper tracking, proper

    packaging, specific work schedules for loading/unloading, etc.

    Most of the shipments are time-bound, therefore on-time delivery is

    very important.

    Type of services required are as follows:

    44

  • 8/3/2019 Domestic Cargo Service

    45/75

    Shipment Tracking and proper co-ordination are the areas of concern

    for most of the companies.

    Conclusion

    The industry looks very attractive in terms of volume. Also, the

    companies are ready to pay a premium as their needs are complex

    and require customized and integrated service.

    3. Garments

    45

  • 8/3/2019 Domestic Cargo Service

    46/75

    Total number of companies visited 17

    The break-up of the size of the companies visited based on their

    monthly expenditure on transportation can be shown as follows:

    Modes of Transport used by the companies are as follows:

    Salient Features of the companies in this Industry are as follows:

    46

  • 8/3/2019 Domestic Cargo Service

    47/75

    Dominance of Local Transporters.

    In some areas loading and unloading may result in extra cost if the

    carrier is not the member of truckers association.

    In most of the cases the shipment is not time-bound and also the

    danger of damage is minimal. Due to this, companies go for cost-

    effective transportation.

    Almost 80% of the companies in this industry go for spot rates while

    deciding on the rates.

    The major destination lanes from Delhi are as follows:

    Type of services required are as follows:

    47

  • 8/3/2019 Domestic Cargo Service

    48/75

    Conclusion

    The industry looks unattractive in terms of volume and also because of

    dominance of local transporters who are serving the industry for several

    years. Also, the companies are not ready to pay any premium as their

    requirements are well served by local transporters.

    4. Pharmaceuticals and Chemicals

    48

  • 8/3/2019 Domestic Cargo Service

    49/75

    Total number of companies visited 15

    The break-up of the size of the companies visited based on their

    monthly expenditure on transportation can be shown as follows:

    Modes of Transport used by the companies are as follows:

    Salient Features of the companies in this Industry are as follows:

    49

  • 8/3/2019 Domestic Cargo Service

    50/75

    Transportation requirements are complex as proper handling of the

    materials is very important.

    Major problem faced by the companies in this sector is of damage/loss

    due to Improper Loading/Unloading and bad vehicle condition.

    Shipment tracking is another area of concern.

    Companies in this sector have different requirements owing to the

    volume, form and fragility of different chemicals and pharmaceutical

    products. So it is important to offer personalized services to individual

    customers.

    Major destination lanes from Delhi are as follows:

    Type of services required are as follows:

    50

  • 8/3/2019 Domestic Cargo Service

    51/75

    Conclusion

    The industry looks very attractive in terms of volume. Also, because of

    its complex transportation needs, they require customized solutions.

    Companies are ready to pay a premium of 2-5% if the service levels

    are met as it increases their efficiency to serve their customers better.

    51

  • 8/3/2019 Domestic Cargo Service

    52/75

    FINDINGS

    Findings

    1.What are your organizations Monthly expenses on

    transportation?

    52

  • 8/3/2019 Domestic Cargo Service

    53/75

    The comparitive data suggests that irrespective of sectors monthly

    expenses are greater than 1lakh which means that Expeditors has

    great opportunities in these sectors and it must tap the market

    potential.

    2. What type of Modes of Transport does your organization

    prefer?

    53

  • 8/3/2019 Domestic Cargo Service

    54/75

    Road being one of the cheapest modes of transportation is preferred

    the most. Roads are best suited for short distance transportation

    needs.

    Engineering being one of the capital intensive industries having bulk

    and volume transportation needs. Roads and Rails are preferred.

    Air mode is preferred for quick and safe delivery, particularly for areas

    which cannot be catered through other modes of transport. High

    Quality Garment producers and retailer prefer air.

    Rail is preferred for bulk and distant transportation. As in the case of

    Retail and Engineering.

    Modes of Transport vs. Monthly expenses on transportation

    The data suggest that expenses are high for quick and high quality

    services like air. As in the case of Retail and pharmaceuticals.

    3. What are the major destinations for movement of your cargo

    from Delhi?

    Major destinations include all the major states in India.

    Sectors like Garments are concentrated more in the southern parts of

    India which is a major producer of garments.

    54

  • 8/3/2019 Domestic Cargo Service

    55/75

    Sectors like engineering are concentrated in industrial areas like

    Andhra and Maharashtra.

    4. Which types of services are required by your organization?

    Sectors like engineering and retail need Full truck loads services

    because of their nature of their products.

    Part loads are preferred in case of low volumes of business which

    generally happens in case of pharmaceuticals and garments.

    5. What are the major problems faced by your organization with

    your current set of transporters?

    55

  • 8/3/2019 Domestic Cargo Service

    56/75

    Irrespective of sectors companies find shipment delivery, damage\loss,

    and proof of delivery confirmation as majors problems which they face

    with their current transporters.

    Others include problems like that of insurance claims, speed of

    delivery etc.

    6. Who takes the decision on transportation for your organization?

    In case of imports, almost 80% of the time the decision on

    transportation is taken by CHA.

    In other cases the Product Manager takes the final call on

    transportation decisions.

    7. Is there mutual consent while dealing with price changes in fuel

    prices?

    About 75% of the companies go for mutual consent while dealing with

    the change in fuel prices.

    56

  • 8/3/2019 Domestic Cargo Service

    57/75

    8. What are the major locations for your warehousing services?

    The major locations for warehousing service other than Delhi are

    Hyderabad, Mumbai and Bangalore.

    II. Expeditors Performance

    Expeditors International of Washington Inc. (EXPD - Analyst Report), a

    third-party logistics provider, has reported second quarter 2011 adjusted

    earnings of 44 cents per share, missing Consensus Estimate of 46 cents.

    Earnings per share increased 5% from 42 cents in the year-ago quarter.

    On a year-over-year basis, revenues in the United States, Other North

    America, Latin America, Europe and Africa, Middle East, and India increased

    16.7%, 14.9%, 15.3%, 31.5% and 0.3%, respectively. Revenue from Asia

    Pacific declined 6.5%.

    Gross profit (net revenue) climbed 13% year over year to $472.6 million.

    Operating income rose 10% year over year to $152.3 million and operating

    expenses grew 3.7% year over year to $1,429.1 million in the reported

    quarter. The whopping growth in the operating income signifies operating

    efficiency and strict cost control measures undertaken by the company.

    Revenue Segments

    Airfreight Services revenue grew 2.3% year over year to $749.1 million in

    the second quarter.

    Ocean Freight and Ocean Services revenue inched up 1.4% year over

    year to $486.8 million.

    57

    http://void%280%29/http://www.zacks.com/ZER/zer_get_pdf.php?r=Z784147&t=EXPD&id=58259http://void%280%29/http://www.zacks.com/ZER/zer_get_pdf.php?r=Z784147&t=EXPD&id=58259
  • 8/3/2019 Domestic Cargo Service

    58/75

    Customs Brokerage and Other Services revenues increased 18.7% year

    over year to $344.7 million.

    Liquidity

    Expeditors balance sheet remained solid with no debt and $1.2 billion in

    cash and cash equivalents at the end of the second quarter, reflecting an

    increase from $0.96 billion in the year-ago quarter.

    Criteria Expeditors DHL UPS FedEx

    3PLRevenue

    2.6bn 5.7bn 4.1bn 603m

    ParentRevenue

    2.6bn 49.7bn 33.5bn 22.5bn

    CoverageAsia, Americas,

    Europe

    Global (Service to

    99% of World GDP)

    Global (Service to

    99% of World GDP)

    Global (Service to

    99% of World GDP)

    3PL assets

    8,000 employees; 149

    warehouses

    13,000 employees 22,000 employees;

    550 warehouses;1100 tractors, 2425

    trailers

    2,000 employees;

    35 warehouses; 298tractors, 1094

    trailers

    Information

    System

    Good; TMS

    Tradeflow, SNEP,Exp.0

    Good; TMS LOGIS,

    proprietary; WMS ELIS

    Excellent; TMS i2,

    Roadnet; WMS operates all major

    systems

    Excellent; TMS

    Optum: SCETransportation i2;

    WMS EXCEED4000

    Services

    Airfreight forwarding,customs brokerage,

    transportationmanagement,

    warehousing anddistribution, supply-

    chain consulting

    Air and ocean freightforwarding, customs

    brokerage,transportation

    management,warehousing and

    distribution, supply-chain consulting

    Air and ocean freightforwarding, customs

    brokerage,transportation

    management,warehousing and

    distribution, supply-chain consulting,

    dedicated contractcarriage, trade

    finance and

    Domestic andinternational

    transportationmanagement,

    customs brokerageand freight

    forwarding, supply-chain consulting,

    warehousing anddistribution services

    58

  • 8/3/2019 Domestic Cargo Service

    59/75

    insurance, equipment

    leasing, mail services

    Industry

    Focus

    Automotive,

    electronics, retail,chemicals, healthcare

    Electronics,

    automotive,consumer products,

    chemicals, industrial

    Computers and

    electronics,telecommunications,

    healthcare,automotive, retail,

    consumer goods

    Apparel,

    automotive,healthcare,

    computers andelectronics,

    industrial, retail

    Evaluation

    Expeditors is a very

    profitable freightforwarder with a

    strong base in China

    and Asia. TheExpeditorsmanagement is candid

    and satirical. Themanagement never

    lost sight as a freightforwarder on turning

    good margins onpurchased

    transportation.Operational quality is

    highly valued andcompany has

    surrounded itself witha good team.

    Expeditors is tied intoan organic growth

    strategy that may notbe sustainable over

    the long haul, but

    works well now.

    Logistics activities

    account for 15% ofthe revenues of

    Deutsche Post World

    Net. DHL does twobillion dollars inrevenue from

    contract logistics,primarily in Europe.

    Operations in theU.S. are mainly in

    freight forwardingbut are expanding

    with the acquisitionof Airborne Logistics.

    Asian presence is theresult of decades of

    experience andpositioning by DHL,

    Danzas and AEIbefore acquisition.

    DHL Danzas is astrong brand in Asia

    and number one in

    several markets.

    UPS SCS has become

    the largest NorthAmerican-based 3PL.

    It had its first

    profitable year in2003 and is now anintegral part of the

    total UPS globaloffering. Having a

    financial andoperational

    powerhouse as aparent is a

    tremendous plus. UPShas generated over

    $2 billion in free cashflow each of the last

    two years. UPS SCS islikely to make a

    significant purchase ifit can make the right

    deal. UPS SCS, like itsparent, has important

    mid-market strength.

    FedEx Supply Chain

    Services follows itsparents emphasis

    on transportation

    and supply-chainsolutions.Preference in

    transportation isgiven to other

    FedEx companies(FedEx Express,

    Ground, CustomCritical and LTL

    carriers). Sistercompany FedEx

    Trade Networks is aquality internationa

    transportationmanager. The 3PL

    revenue shownabove is for FedEx

    SCS and relatednon-expenses, non-

    package businesses

    Our Analysis

    Expeditors is focused on gaining market share, expanding gross profits,

    easing capacity constraints as well as increasing operational efficiency.

    Expeditors debt-free balance sheet, superior execution, and ability to return

    59

  • 8/3/2019 Domestic Cargo Service

    60/75

    cash to shareholders in the form of dividends make it attractive for

    investment.

    However, competitive threats from companies like United Parcel Service

    Inc. (UPS - Analyst Report), as well as the companys dependence on asset-

    based transportation providers to move its shipments make us cautious on

    the stock for the long term.

    The company currently maintains our long-term Neutral recommendation on

    Expeditors International.

    Total revenue upped 4% year over year to $1.58 billion but this was below

    the estimate.

    60

    http://void%280%29/http://www.zacks.com/ZER/zer_get_pdf.php?r=Z794930&t=UPS&id=58259http://void%280%29/http://www.zacks.com/ZER/zer_get_pdf.php?r=Z794930&t=UPS&id=58259
  • 8/3/2019 Domestic Cargo Service

    61/75

    CONCLUSION

    CONCLUSION

    International Logistics is the designing and managing of a system that

    controls the flow of materials into, through, and out of the international

    corporation. Domestic logistics is designing and managing of a system

    within a country for control of flow of materials. Globally, the logistics

    industry is valued at US$ 3.5 trillion. The Indian Logistics Industry is

    presently estimated at US$ 90 billion (CII) which gives employment to 45million people.

    Difference between Domestic & International Logistics can be said to

    arise mainly on account of the three major factors:

    61

  • 8/3/2019 Domestic Cargo Service

    62/75

    Logistic costs is International Business is much more higher than the

    domestic business,

    The Logistic Mechanics are much more complex in the context of

    international logistics than the domestic logistics,

    The political, cultural and institutional factors connected with

    international logistics are of considerable importance whereas these

    are usually not of much consequence in the context of domestic

    logistics.

    India is being touted as the land of opportunity for logistics service providers

    all over the world. Expeditors can use its greater flexibility in services to its

    advantage to counter its major competitors through the following

    differentiated services which are as follows:-

    Expeditors' proprietary track and trace tool available online to all

    customers. In addition, customers can use edoc to convert hard

    copies of documents into digital format, where they can be easily

    shared and archived for retrieval later. With these applications,

    customers can analyze their supply chain with a host of reporting.

    Depending on needs urgent or specialized - Expeditors provides a cost

    effective, flexible set of logistics options to keep the cargo visible and

    moving in the supply chain.

    Shippers expect delivery methods that are flexible yet guaranteed.

    The service options are designed to give the customers earlier arrivals

    and later cut times to increase velocity within the logistics network.

    Information is a key component of successful partnering, so Expeditors

    provides direct access to customers purchase orders, vendors'

    inventory and pipeline visibility with the click of a button.

    62

  • 8/3/2019 Domestic Cargo Service

    63/75

    Expeditors by leveraging global network, systems and established

    portfolio of products, can provide a seamless transition for customers

    within land continent areas of their supply chain.

    Sector-wise analysis of the survey and the companys internal strengths and

    weaknesses shows that Expeditors should target sectors like Retail,

    Pharmaceuticals and other Hazardous and Non-Hazardous chemicals

    as the transportation needs of the companies in these sectors are complex

    and their requirements of integrated and quality service can be well met by

    Expeditors. The company must also keep on innovating so as to remain

    ahead and to exceed customers expectations. Expeditors can leverage ontheir strong and modern IT infrastructure and wide reach to cater to these

    sectors and gain a strong foothold in domestic movement of cargo in India.

    63

  • 8/3/2019 Domestic Cargo Service

    64/75

    SUGGESTIONS

    SUGGESTIONS

    1. Expeditors should target sectors like Retail, Pharmaceuticals and

    other Hazardous and Non-Hazardous chemicals as the

    transportation needs of the companies in these sectors are complex

    and their requirements of integrated and quality service can be well

    met by Expeditors.

    2. Problems of damage\loss can be solved by expeditors by providing its

    own insurance services. So that customers do not need to go

    elsewhere for insurance of transportation.

    64

  • 8/3/2019 Domestic Cargo Service

    65/75

    3. Since Expeditors main competitors are DHL, FedEx which have their

    services all over India. Expeditors should leverage on their strong and

    modern IT infrastructure and wide reach to cater to these sectors and

    gain a strong foothold in domestic movement of cargo in India.

    4. Companies like DHL own the fleet which they use for transportation.

    3PL service which Expeditors uses must be consistent and certain

    supervision mechanism must be developed to maintain quality of the

    service.

    5. Another problem area is proof of delivery (POD). Expeditors must use

    electronic systems as POD instead of manual slips which it uses at

    present. It would help monitor Proof of Delivery on real time basis.

    6. While dealing with change in fuel prices. Expeditors must adequately

    sensitize its clients about reasons for the change transportation costs.

    7. The company could think of turning itself into asset based company

    from non asset based company to thwart increasing competition from

    other asset based companies like UPS, DHL, Fed Ex.

    8. India is one of the countries which have a huge domestic consumption

    owing to the population of more than one billion people which further

    puts pressure on Logistics Company to provide efficient service and

    wide geographic reach. Expeditors must increase its presence in India.

    65

  • 8/3/2019 Domestic Cargo Service

    66/75

    66

  • 8/3/2019 Domestic Cargo Service

    67/75

    LIMITATIONS

    LIMITATIONS

    1. Research work was carried in Delhi only. The findings maynot be applicable to other parts of the country.

    2. Responses could be biased and may not give true picture ofthe requirements of various companies for domesticmovement of cargo.

    3. Lack of personal touch since Data was collected throughtelephonic means so may be inaccurate.

    67

  • 8/3/2019 Domestic Cargo Service

    68/75

    4. Shortage of time was a major constraint

    BIBLIOGRAPHY

    68

  • 8/3/2019 Domestic Cargo Service

    69/75

    BIBLIOGRAPHY

    Googlemaps.com

    Indianrailways.com

    Mapofindia.com

    Jimmy Olsson / EFT Research available viahttp://logisticsmanagementandsupplychainmanagement.wordpress.com/2007/04/22/india-the-logistics-boom-continues/

    Pack Pluss report on Indian Logistics show 2009;http://www.indialogisticsshow.com/Industry.htm

    Frost and Sullivan Report on 3PL Logistics (2006)

    69

    http://www.indialogisticsshow.com/Industry.htmhttp://www.indialogisticsshow.com/Industry.htm
  • 8/3/2019 Domestic Cargo Service

    70/75

    Business Logistics and SCM (2007)http://logisticsmanagementandsupplychainmanagement.wordpress.com/2007/03/22/asias-next-major-logistics-hotspot-india/

    http://www.expeditors.com/

    70

  • 8/3/2019 Domestic Cargo Service

    71/75

    ANNEXURE

    Questionnaire

    1.Type of sector?

    Engineering Retail Garments Pharmaceuticals andchemicals

    2. What are your organizations Monthly expenses on

    transportation?

    Less than and Greater than 10000 Greater than25000Equal to 10000 and less than equal to 25000 less than equal to50000

    Greater than 50000 Greater than 100000Less than equal to 1 lakh

    71

  • 8/3/2019 Domestic Cargo Service

    72/75

    3. What type of Modes of Transport does your organization

    prefer?

    Rail Road Air

    4. What are the major destinations for movement of your cargo

    from Delhi?

    Gujrat Tamil Nadu West Bengal Andhra Pradesh

    Maharashtra

    5. Which types of services are required by your organization?

    Part Load Full Load Express Cargo Container By Air

    By Rail

    6. What are the major problems faced by your organization with

    your current set of transporters?

    Shipment Tracking Damage\Loss POD confirmation

    Others

    7. Is there mutual consent while dealing with the change in fuel

    prices?

    Yes No Cant Say

    72

  • 8/3/2019 Domestic Cargo Service

    73/75

    8. What are the major locations for your warehousing services?

    9.Who takes the decision on transportation for your

    organization?

    DELHI INSTITUTE OF ADVANCED STUDIESEVALUATION SHEET FOR PROJECT REPORT

    STUDENTSS NAME :______________________________

    ROLL NO. :______________________________

    EVALUATORS FEEDBACK :______________________________

    73

  • 8/3/2019 Domestic Cargo Service

    74/75

    _______________________________

    _______________________________

    DID THE STUDENT CONTACT YOU

    REGULARLY FOR DISCUSSION? : YES/NO (Please tick)

    REPORT IS APPROVED / DISAPPROVED:

    (To be ticked by Evaluator)

    MARKS AWARDED :_______________________________

    (Out of 40)

    SIGNATURE OF EVALUATOR

    NAME:

    DATE:

    *In case report is disapproved, student has to resubmit the report after

    incorporating the suggestions given on the feedback form. Revised report should

    be submitted along with the feedback form.

    DELHI INSTITUTE OF ADVANCED STUDIESATTENDANCE FOR SUMMER TRAINING PROJECT REPORT

    NAME OF THE STUDENT :

    CLASS :ROLL NO :

    NAME OF THE SUPERVISOR :

    SNO. DATE TIME PROGRESS OF

    REPORT

    REMARKS

    SIGNATURE

    OF STUDENT

    SIGNATURE

    OF

    SUPERVISOR

    74

  • 8/3/2019 Domestic Cargo Service

    75/75

    1

    2

    3

    4

    5

    6

    7

    8

    9

    10

    *Minimum (8 out of 10) 80% attendance required.

    Co-ordinator