A Project Report on Domestic Transportation in India at Expeditor’s Benglore

A study on Domestic Transportation in India at Expeditor’s

EXECUTIVE SUMMARY INDUSTRY PROFILE India is being touted as the land of opportunity for logistics service providers all over the world.

The Indian logistics market represents $ 50billion and is growing at a rate of 7 percent annually.

Transportation costs account for nearly 40% of production costs, logistics costs around 13% of GDP, compared to 8% in the US. Growth in Indian economy is the major driving factor for the demand in logistics industry.

Automobile and engineering goods, chemicals, FMCG, cement and textiles have been identified as the top five contributors to logistics revenues.

India has the second highest largest road network-3.3 million km. Road Network carry nearly 65% of freight The Indian Railways boasts of being the world’s 2nd largest rail network spread over 81,511 km and covering 6896 stations. The freight segment accounts for roughly two thirds of railway’s revenues. It has 12 major and 184 minor / intermediate ports spread across the vast coastline of 7517km. The 12 major ports handle about 76 per cent of the traffic. Port traffic to grow to a level of 950 MillionTonnes per Annum by 2009- Ministry of Shipping. Aviation holds a small share of India’s freight market. Air Freight is very expensive in India in comparison to road and rail. The size of the world air cargo market is estimated at 27 million tonnes valued at $200 billion. India accounts for meager 3% of the global air cargo market. As per an expert estimate, Indian air cargo industry is going to be double by the year 2010.

COMPANY PROFILE Expeditors international India pvt ltd is a global logistics company which was established in the year 1979 by Peter.J.Rose and his partners in Washington. Expeditors is much more than getting a piece of freight from one point to another. The Council of Logistics Management defines logistics as that part of the supply chain process that plans, implements, and controls the efficient, effective flow and storage of goods, services, and related information from the point of origin to the point of consumption in order to meet customers' requirements.

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A study on Domestic Transportation in India at Expeditor’s

Expeditors job is to make sure that from raw material to finished goods sitting on the retail shelf, they provide the critical services and information necessary to give their clients a competitive advantage in the management of their supply chains.

Need for the study: To study about the domestic transportation of goods its current status, challenges and requirements.

OBJECTIVES •

To know the current status of domestic transportation.

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To know the problems facing by the customers with transporters, challenges taken to overcome them.

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To know the modern technology used in transportation of goods.

SCOPE OF THE STUDY  The study will help us to know the present status of the Indian logistics.  It helps to know the problems facing by the customers with transporters.  To know the modern technologies used in transportation of goods

METHODOLOGY Method of collecting primary data was through questionnaire and personnel interview and secondary data has been collected through Internet, observation, company manual etc. For the purpose of study logistics executives of manufacturing companies have been chosen as a sample size of 50 through convenient random sampling. Data collected was tabulated and simple percentage method was used to derive conclusion. Depending on this I have made my own suggestions & given my own idea to improve transportation of goods.

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FINDINGS •

Majority of the customers are facing the problem of shipment tracking facility in transporting vehicles.

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Majority of the manufactured goods are damaged due transportation through open trucks.

SUGGESTION AND RECOMMENDATIONS •

Since majority of the customers are facing the problem of shipment tracking hence a tracking tool called GPRS system should be adopted to measure, record and transmit parameters like date, time, speed and location to the command centre using the local GSM/GPRS network. The system automatically switches over to SMS wherever GPRS coverage is not available.

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In India major transportation is through open trucks hence there is increase in damage/loss. So closed trucks like canters and container transportation will be a better alternative.

CONCLUSION •

Modern technological device called GPRS should be used in transporting vehicles, so that customers can track the vehicle.

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Canters and containerized transportation is adopted, so that damage/loss can be minimized.

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INTRODUCTION OF THE STUDY Logistics and supply chain practices are a set of activities undertaken to promote effective and efficient management of supply chains. These include supplier partnership, physical movement of goods (logistics) and information sharing throughout the supply chain in order to meet customer requirements. Some of the key logistics and supply chain practices that impact performance are related to estimation of customers order, efficient and effective delivery, integration and collaboration throughout the supply chain, sharing of vision and information using formal and informal methods, as well as use information and communication technology(ICT) and various specialist for performing specific jobs across the supply chain. All of these practices impact logistics the supply chain performance.

Title of the project “A study on Domestic transportation in India” It is virtually inconceivable in today's economy for a firm to function without the aid of transportation. Transportation is an essential and a major sub-function of logistics that creates time and place utility in goods. In fact, the backbone of the entire supply chain is the transportation management that makes it possible to achieve the well known seven Rs- the right product in the right quantity and the right condition, at the right place, at the right time, for the right customer at the right cost.

The importance of transportation should also be seen by looking at the impact of transportation on a country's economy. Studies reveal that in India the total logistics costs constitute nearly 10 percent of the GNP out of which nearly 40 percent is because of transportation alone. The major infrastructure required for moving goods from one place to another in India involve the active roles of Roads, Road Freight Industry, Railways, Ports and Shipping, and Pipelines, all of which are either managed or regulated by the government in accordance with the private.

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Transportation and logistics services are generally outsourced to third parties. Transportation is mainly by road and the lead-time of these supply chains is still as high as nine to twelve weeks.

This is quite understandable, given the size of India and the state of its infrastructural facilities.

Transportation and logistics is generally through their own fleet. In some cases, it is outsourced.

Routing and scheduling software are increasingly being used for these activities. Five out of six firms use standard ERP software. There is high focus on tracking of customer orders and customer care and technologies like bar codes and GPS are being employed.

In our on site observation of 50 firms, we find that the primary focus is on quality, cost and service. Recently, responsiveness (delivery speed, safety, volume flexibility, shipment weight and innovation) is also catching up management attention. Correspondingly, the major concern in all these firms and their supply chains are related to cost, clarity of demand, reliability of partners, shortening of delivery cycle, production and logistics flexibility and innovation in supply chain practices. Sharing of benefits within the supply chains has not yet gained much attention. Firm especially in the automotive, retail, manufacturing and FMCG sectors are increasingly opting to outsource their logistics requirements to specialized service providers, the positive business atmosphere and a burgeoning consumer market are making the shipper community push the logistic service propositions.

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Logistics Origin and Definition of Logistics: The term "logistics" originates from the ancient Greek "λόγος" ("logos"—"ratio, word, calculation, reason, speech, oration"). Logistics is considered to have originated in the military's need to supply themselves with arms, ammunition and rations as they moved from their base to a forward position. In ancient Greek, Roman and Byzantine empires, there were military officers with the title ‘Logistikas’ who were responsible for financial and distribution of supplies.

The Oxford English dictionary defines logistics as: “The branch of military science having to do with procuring, maintaining and transporting material, personnel and facilities”. Another dictionary definition is: "The time related positioning of resources." As such, logistics is commonly seen as a branch of engineering which creates "people systems" rather than "machine systems"....

Prospects of Growth in the Industry In years gone by, the traditional warehousing and logistics facility was located by railroad tracks, a water port, and/or freeways, usually in the least desirable parts of cities or large towns. This stereotype then faded as gigantic, state-of-the-art facilities began to sprout in more rural areas on the outskirts of transportation and population hubs. The World started beginning to see such facilities showing up in even less "traditional" areas. Modern warehouses now are being located in carefully manicured industrial parks that are sprouting as fast as the corn and wheat once did in these open spaces-often in out-of-the-way places. Why the emphasis on such locations for logistics companies?

Much of it is due to the great flux that the logistics industry has been undergoing in the first three years of the 21st century. Most of these changes are being driven by a growing trend in the manufacturing and retail sectors to form partnerships with companies to which they can outsource non-core logistics competencies-3PL providers.

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In turn, 3PL providers are continually looking to provide innovative supply chain solutions to customers by focusing on value-added capabilities, differentiating themselves from the competition. They focus on key objectives, such as implementing information technologies, instituting effective management processes, integrating services and technologies globally, and delivering comprehensive solutions that create value for 3PL users and their supply chains. This need to partner with customers and become more integrated into their supply chain processes has created the ancillary need to locate close to these customers.

That isn't to say the need for easy access to transportation hubs and different modes of transportation won't continue to be important. But the above shift in business strategy, along with the advances in technology and enhanced communication, has opened the door for logistics facilities to operate effortlessly in a myriad of location.

Profit warnings, share price pressures, mergers, reorganizations, relocations, disposals, painful layoffs and great geopolitical uncertainties can sweep away even the most comprehensive logistics strategies – and that’s despite outstanding management over many years. These are exceptionally difficult times and it has never been more important to connect logistics and freight planning to executive board thinking than now. It’s easy to lose sight of the bigger picture in the rush to cut infrastructure cost and conserve cash. Hopefully organization succeed in protecting the business, satisfying shareholders and analysts, but what about capacity and flexibility, morale and momentum?

To be a logistics winner in the coming years organizations need to use the downturn to reshape for growth, propelled by an unshakeable conviction that the mission is still important, that more prosperous times lie ahead, and that in some way the company infrastructure is helping to build a better kind of world.

Own passion for running the race matters most of all in a downturn, when people are insecure, see only savage cost savings, and loyalty is tested. The corporation’s future will be dominated by six factors, or faces of a cube, spelling F U T U R E.

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Logistics is inevitable in the future and essentially the management policy also has a significant role in the future of world. Generally the study is being featured with all aspects of management in Logistics and Freight areas. (Logistics include Transportation, Warehousing, Network Design, Cross docking, and Value Adding).

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INDUSTRY PROFILE Logistics can be defined as providing the right type of products and/or services at the right price, at place, time and in the right condition. A quick look back at some logistics history may prove very enlightening. Logistics can be classified as an enterprise planning framework for material management, information, service and capital flows. Logistics when seen in the context of the modern day prevalent work environment also includes information that is complex in nature besides giving importance to all the communication and control system that are essential for efficient working of the organization.

The birth of Logistics can be traced back to ancient war times of Greek and Roman empires when military officers titled as 'Logistikas' were assigned the duties of providing services related to supply and distribution of resources. This was done to enable the soldiers to move from their base position to a new forward position efficiently, which could be a crucial factor in determining the outcome of wars. This also involved inflicting damage to the supply locations of the enemy and safeguarding one's own supply locations. Thus, this lead to the development of a system which can be related to the current day system of logistics management.

During the Second World War (1939-1945), logistics evolved greatly. The army logistics of United States and counterparts proved to be more than the German army could handle. The supply locations of German armed forces were inflicted with serious damages and Germany was not able to wreak the same havoc on its enemy. The United States military ensured that the services and supplies were provided at the right time and at the right place. It also tried to provide these services when and wherever required, in the most optimal and economical manner.

The best available options to do the task were developed. This also gave birth to several military logistics techniques which are still in use, albeit in a more advanced form.

Logistics has now evolved itself as an art and science. However, it cannot be termed as an exact science. Logistics does not follow a defined set of tables nor is it based on skills inherited from birth. A logistics manager performs his duties and responsibilities based on his educational experiences, skills, past experiences and intuition. These skills are nourished by a constant Babasabpatilfreepptmba.com

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application of the same by him for the betterment of his organization. The logistics manager ensures that the company is benefited by an effective and efficient system of logistical management. He also needs to ensure that the right kind of products and services are provided at the right time and for a right price, whether inside the organization's premises or delivery of shipments outside the premises of the organization.

Logistics has come to be a kind of relief for many organizations that formerly looked upon it as a burden. Companies nowadays are hiring people with the requisite knowledge to deliver sustainable enhancements in the field of supply chain management. As has been the case throughout most of logistics history, the task of a logistics manager involves a clear vision and a drive within to deliver results under strict deadlines in addition to his usual responsibilities.

Logistics in India Logistics in India don't differ too markedly from logistics anywhere else in the world. It's the the art and science of managing and controlling the flow of goods, products, services, energy, information and people from the origin point to the destination point. It includes the proper combination of several activities such as material handling, warehousing, and information, for the purpose of ensuring supply of the right product, at the right time, at the right place, for a right cost in the right condition.

In the past, India has been the student rather than the expert when it comes to the field of logistics. But with its current expertise, valuable human resources and positive plans, it surely is walking on the path of being a service provider of class. There are several factors that benefit the Indian economy for reaching success in the field of logistics, namely: 1. India is the fourth largest economy in the world.

2. It is believed that about one-quarter of the youth population of the world resides in India.

3. India has human resources that are high in knowledge and abilities.

4. It is the second-largest English speaking workforce.

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5. It has the 2nd largest pool of qualified technical workforce.

India spends 13 percent of its Gross Domestic Product (GDP) on logistics as opposed to the usual practice of 10 percent by other developing nations. The Indian economy is striving for improvements in the field of logistics and supply chain management to gain the competitive edge in today's worldwide economy. The Indian government has favored the logistics market of India by making some helpful plans and policies to assist in its growth.

There are several events organized for the promotion of logistics in India which are focused in their approach and relevant to the business solutions besides providing a solid platform for allowing people from a wide industry spectrum to meet and provide business within them from all over the country. This has been an emphatic source of providing business solutions and their development.

Several global third party logistics providers (3PLs) have already started developing their operations and service networks in India with a purpose to explore the rampant Indian economy.

This has resulted in the creation of the need for a vast range of supply chain management (SCM) and logistics solutions which cover several factors such as supply chain, logistics, material handling, storage, Information technology (IT), warehousing and inventory management. This has benefited the efficiency and productivity of the complete value chain in several dimensions of profits, speed and customer service.

The Confederation of Indian Industry (CII) is the premier business organization with a known commitment towards the development of logistics in India. It has established the CII Institute of Logistics which is a specialized state-of-the-art institute of excellence with its focus on SCM and logistics. It is brought up to satisfy the latest industry needs for specialized SCM and logistics.

India is being treated as the destination of the future in the field of logistical service providers all over the globe. Indian logistical market players have started to gear up and position themselves in the global scenario. The true potential of these service providers is yet to be realized. India is keen to offer transportation and logistical service to grow itself as an emerging marketplace. The

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key sectors include fashion, gems, jewelry, pharmaceuticals, precision tools and engineering goods, all of which need special shipping provisions.

Size of the Indian logistics industry The annual logistics cost in India is estimated to be 14% of the GDP, which translates into USD 140 billion assuming the GDP of India to be slightly over USD 1 trillion. Out of this USD 140 billion logistics cost, almost 99% is accounted for by the unorganized sector (such as owners of less than 5 trucks, affiliated to a broker or a transport company, small warehouse operators, customs brokers, freight forwarders, etc.), and slightly more than 1%, i.e. approximately USD 1.5 billion, is contributed by the organized sector. So, one can see that the logistics industry in India is in a nascent stage. However, the industry is growing at a fast pace and if India can bring down its logistics cost from 14% to 9% of the GDP (level in the US), savings to the tune of USD 50 billion will be realized at the current GDP level, making Indian goods more competitive in the global market. Moreover, growth in the logistics sector would imply improved service delivery and customer satisfaction leading to growth of export of Indian goods and potential for creation of job opportunities.

Logistics Management and Logistics Management Software Logistics management is that part of the supply chain which plans, implements and controls the efficient, effective forward and reverse flow and storage of goods, services and related information between the point of origin and the point of consumption in order to meet customers' requirements. A professional working in the field of logistics management is called a logistician.

Software is used for automating logistics activities which helps the supply chain industry in automating the work flow as well as management of the system. Very few generalized software are only available in the new market in the said topology. This is because there is no common rule to generalize the system as well as work flow even though the practice is more or less the same. Most of the commercial companies do use one or the other custom solution. There are various software that are being used within the departments of logistics.

The software’s that are used in these departments are, Babasabpatilfreepptmba.com

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Conventional Department: CVT software / CTMS software Container Trucking: CTMS software Business Logistics Logistics as a business concept evolved only in the 1950s. This was mainly due to the increasing complexity of supplying one's business with materials and shipping out products in an increasingly globalize supply chain, calling for experts in the field who are called Supply Chain Logisticians. This can be defined as having the right item in the right quantity at the right time at the right place for the right price and it is the science of process having its presence in all sectors of the industry. The goal of logistics work is to manage the fruition of project life cycles, supply chains and resultant efficiencies.

In business, logistics may have either internal focus (inbound logistics), or external focus (outbound logistics) covering the flow and storage of materials from point of origin to point of consumption. The main functions of a qualified logistician include inventory management, purchasing, transportation, warehousing, consultation and the organizing and planning of these activities. Logisticians combine the professional knowledge of each of these functions so that there is a coordination of resources in an organization.

There are two fundamentally different forms of logistics. One optimizes a steady flow of material through a network of transport links and storage nodes. The other coordinates a sequence of resources to carry out some project. b. Production Logistics The term is used for describing logistic processes within an industry. The purpose of production logistics is to ensure that each machine and workstation is being fed with the right product in the right quantity and quality at the right point in time.

The issue is not the transportation itself, but to streamline and control the flow through the value adding processes and eliminates non-value adding ones. Production logistics can be applied in existing as well as new plants. Manufacturing in an existing plant is a constantly changing Babasabpatilfreepptmba.com

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process. Machines are exchanged and new ones added, which gives the opportunity to improve the production logistics system accordingly. Production logistics provides the means to achieve customer response and capital efficiency. Production logistics is getting more and more important with the decreasing batch sizes. Even a single customer demand can be fulfilled in an efficient way. Track and tracing, which is an essential part of production logistics - due to product safety and product reliability issues - is also gaining importance especially in the automotive and the medical industry.

Features of Indian Logistics Industry •A number of small-integrated players.

•Transportation costs account for nearly 40% of production costs.

•Logistics costs around 13% of GDP, compared to 8% in the US. •Growth in Indian economy is the major driving factor for the demand in logistics industry.

•Chemicals, metals, FMCG, cement and textiles have been identified as the top five contributors to logistics revenues.

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Growth Drivers for Logistics in India •General growth of the Indian economy.

•Manufacturing boom-for exports as well as for domestic market.

•Expected rise in International trade from India.

•MNC’s setting up manufacturing in India-Nokia, Flextronics.

•Government’s thrust on Infrastructure --US$17 billion to upgrade highway networks.

•Implementation of VAT will lead to growth in warehousing business.

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A study on Domestic Transportation in India at Expeditor’s •Opening of organized retail sector -attracting retail chains like Wal-Mart and Carrefour into Indian players like Pantaloon and Reliance.

Government Support The Indian government is making great efforts by •Privatizing ports and airports.

•Increasing the number of gateway ports •Investing in highway projects •Streamlining customs and excise procedures •Implementing EDI systems •Improving the rail network

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•The government plans to invest $17 billion in transport infrastructure between 2006-2010.

Some of the projects are •

Amend in the National Highway Act to expedite land acquisition, permit private financing and allow tolling.

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Improvement in rural access by launch of the Prime Minister’s Rural Roads Program.

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Reduction of congestion on rail corridors and improvement of port connectivity by launch of National Railway Development Program.

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Upgradation of infrastructure and connectivity in the country's twelve major ports by initiating the National Maritime Development Program.

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Establishment of Tariff Authority for Major Ports to regulate tariffs.

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•

•

On a per-annum basis, United States invests 5 percent of its annual logistics spend on infrastructure, India is investing 23 percent or over four times as much.

Industry Growth=Logistics Growth •

“Engineering goods, chemicals and gems & jewelry are the fastest-growing sectors; manufacturing in India is expected to grow by 9.4 percent in coming years.” says Jacques Green, Managing Director FedEx-India, Middle East &Africa.

Auto •

Outsourcing in Auto sector could be worth $375 billion by 2015 and India could capture up to $25 billion of this amount. [source:McKinsey]

Chemicals •

India’s chemical exports could reach $15 billion by 2015. [Source: McKinsey].

Electrical and Electronic Products •

India’s export in electrical and electronic products could reach upto $18 billion a year by 2015[source: McKinsey].

Retail •

Opening up of the organized retail sector is attracting big retail chains like Wal-Mart and Carrefour in addition to big Indian retailers like Pantaloon and Reliance.

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All this would require the presence of professional logistics players in the market to carry out supply chain activities.

Thus demand for logistics services would be largely driven by the growth of the Indian economy.

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Logistics is a mixture of several professional disciplines, such as: 1. Planning 2. Controlling 3. Directing 4. Coordination 5. Forecasting 6. Warehousing and transportation 7. Facility location 8. Inventory management All activities that are involved in the movement of goods and services from the point of origin to the point of final consumption are grouped under the term 'logistics'. The art of managing or supervising all these activities when grouped together as a collective unit, are placed under 'logistics management'. People who are authorized or given the task of managing the aspect of logistics management are referred to as 'distribution managers' or 'logistics managers'.

Importance of logistics 1. Logistics is the bed rock of trade and business.

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Without selling and or buying there can be no trade and business. Buying and or selling takes place only when goods are physically moved into and or away from the market.

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Take away logistical support trade and business will collapse

2. Leads to customer satisfaction through superior customer service.

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Organizational objectives of P [Productivity],Q [Quality],C [Cost],D [Delivery],E [Employee

Morale],F [Flexibility],S [Safety],H [Health],E [Environment] are set to

meet customer expectations of Q,C,D,Q, C, S, H, E are parts of must be quality that a Babasabpatilfreepptmba.com

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Logistics addresses D, F objectives which lead to customer

satisfaction through superior customer service

3.Integrates logistical activities •

In conventional management environment, various activities of logistics work in isolation under different management functions. Each pocket trying to sub optimize its objectives at the cost of overall organizational objectives. Purchasing trying to purchase at minimum price at the cost of what is needed by operations. Operations produce large quantities at minimum production cost ignoring demand leading to doom inventory. Logistics function of management brings all such functions under one umbrella pulling down inter departmental barriers.

4.Competitive edge •

In the fiercely competitive environment logistics provides the edge. Due to technological revolution most of the products are moving into commodity markets. In a commodity market where price is controlled by competition, where there is no product differentiation in terms of quality parameters like performance & reliability, where brands are almost irrelevant, competitive edge is that of availability of product and service in terms of time, place and quantity.

5.Logistics wins or loses wars •

British lost American war of independence due to poor logistics

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Rommel was beaten in the desert by superior logistics of Allies

6.Supports critical functions like operations and marketing

Strong logistics support enables a company to move towards JUST IN TIME production system for survival in a highly competitive market

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A study on Domestic Transportation in India at Expeditor’s a) Interface with marketing These days marketing a product is increasingly on the strength of availability and flexibility as we discussed earlier. Stronger emphasis is on the last of four Ps of marketing [product, price, promotion and place]. Logistics provides the interface between production function and marketing function. Marketing is trying to sell the product in the market place. Logistics makes the product accessible to marketing by acting as interface between the function that produces it and the function that makes the consumer buy it.

This interface is gaining importance due to following changes that are sweeping the market making many companies adopt JUST IN TIME production system. a.

Change in the customer: demanding, knowledgeable, conscious of rights, lacking in brand loyalty, changes preferences very fast, expects very high degree of service

b.

Many products are moving towards commodities market: product differentiation in terms of quality of performance is vanishing and brands are losing their magic.

As a result of above we find that availability is an important determinant of purchasing decision.

7. Logistical costs: For individual businesses logistics expenditures are 5% to 35% of sales

depending on type of business, geographical areas of operation, weight/value ratios of products and materials. This is an expensive operation. Improvement in the efficiency of logistics function yields savings as well as customer satisfaction

Importance of logistics management in India I.

Liberalization and opening our door to competition

II.

Global business has long supply & distribution lines

III.

Changing Indian customer, aware, demanding and less brand loyal

IV.

Competition ensures that product differentiation in terms of quality is difficult

V.

Product life cycles are shrinking

VI.

Our markets are shifting from sellers’ to buyers’

VII.

Many consumer products are moving into commodities market

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India is a large country. Large distances separate production and consumption centers.

Essential commodities have to travel from Food Corporation warehouses to consumers through PDS.

IX.

Logistics performance has not been impressive.

OPERATIONAL OBJECTIVES OF LOGISTICS 1.

Rapid response F-flexibility objective of an organization: Some companies measure this as response time to customer’s order. On an average how much time do we need to fulfill one particular type of customer’s order in a year? This is a measure of Rapid response.

Logistics should ensure that the supplier is able to respond to the change in the demand very fast. Entire production should change from traditional push system to pull system to facilitate rapid response. Instead of stocking the goods and supplying on demand, orders are executed on shipment-to-shipment basis. Information Technology plays an important role here as an enabler. IT helps management in producing and delivering goods when the consumer needs them. This results into reduction of inventory and exposes all operational deficiencies. Now the management resolves these deficiencies and slashes down costs. [Concept of SMED and KANBAN as practiced by JIT companies in Japan or elsewhere]

2.

Minimum variance D-delivery objective of an organization, this can be measured as ‘On Time Delivery’ or OTD. If 100 deliveries are made in a month/quarter/year how many reached as per the commitment made to the customer? This percentage is OTD. Any event that disrupts a system is variance. Logistics operations are disrupted by events like delays due to obstacles in information flow, traffic snarls, acts of god, wrong dispatches, damage in transit. Traditional approach is to keep safety stocks and transport the goods by high cost mode. The cost of this approach is huge. Logistics is expected to minimize these events, thereby minimize and improve on OTD

3.

Minimum inventory

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A study on Domestic Transportation in India at Expeditor’s This is component of cost objective of a company. Inventory is associated with a huge baggage of costs. It is termed as a necessary evil. Objective of minimum inventory is measured as Inventory Turns or Inventory Turnover Ratio. Americans call this measure as turn velocity. Logistics management increases these turns without sacrificing customer satisfaction. Higher turns ensure effective utilization of assets devoted to stock. [Concept of

single piece flow as practiced by JIT companies in Japan or elsewhere]. Logistical management should keep the overall well being of a company in view and fix a minimum inventory level without trying to minimize the inventory level as an isolated objective 4.

Movement consolidation Transportation is the biggest contributor to logistics cost. Transportation cost depends on product type, size, weight, distance to be transported etc. for transporting small shipments just in time [reduction in inventory costs] expensive transport modes are used which again tend to hike the costs. Movement consolidation is planning several such small shipments together [of different types of shipments] by integrating interests of several players in the supply chain.

Generally, large shipment size and long distances reduce transportation cost per unit.

Movement consolidation shall result into reduction in transportation costs.

5.

Quality If the quality of product fails logistics will have to ship the product out of customer’s premises and repeat the logistics operation again. This adds to costs and customer dissatisfaction. Hence logistics should contribute to TQM initiative of management. In fact, commitment to TQM has made the management’s world over wake up to the significance of logistics function. Logistics can play a significant role in total quality improvement by improving the quality of logistics performance continuously and continually.

6.

Life cycle support [cradle to cradle logistical support- produce, pack (cradle) and repack (cradle)] Logistics function is expected to provide life cycle support to the product after sale. This includes

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After sales service: the service support needed by the product once it is sold during its life cycle

b.

Reverse logistics [concept Oct’03] or Product recall as a result of -Rigid quality standards [critical in case of contaminated products which can cause environmental hazard] -Transit damage [leaking containers containing hazardous material] -Product expiration dating -Rigid laws prohibiting unscientific disposal of items associated with product [packaging] -Rigid laws making recycling mandatory -Erroneous order processing by supplier -Reverse logistics is an important component of logistics planning.

Logistics functions 1.

Information management Management is appreciating importance of information as an element of logistics of late, now.

The role of information is vital in order processing. Quality of information is critical as error in composition of information requirement creates potential disturbance in the supply chain.

Incorrect order processing due to erroneous information will result into product recall and reshipment if the sales opportunity still exists.

Faster and quality information flow from customer to processor results into cost effective logistics. Forecasting and order management are two areas of logistical work dependent on information.

Forecasting is an effort to estimate future requirements to position inventory or assets devoted to inventory. As forecasting becomes unreliable in a fast changing environment, control strategies like JIT, Quick Response and Continuous Replenishment came into being. Now it is the task of the logistics function to use information technology to strengthen operation control and forecasting to the best advantage of the organization.

Leading firms typically have information systems capable of monitoring logistical performance on a real time basis giving them the capability to identify potential operational

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A study on Domestic Transportation in India at Expeditor’s breakdowns and take corrective actions prior to customer service failure. In situations where timely corrective action is not possible, customers can be notified in advance and thereby taking the surprise out of forthcoming service failures 2.

Inventory control Keeping the stock levels in such a position, so that neither stock out nor stock piling takes place is Inventory control. While formulating inventory policies find out 20% of the products marketed that account for 80% of the profit.

3.

Transportation Transportation is the most visible of all elements of logistics and high contributor to logistics expenditure. Costs of transportation are mainly as follows a. Movement costs: money paid for moving material across geographical terrain b. Preservation costs: money spent on preserving the material during transit c. Cost of idle asset: inventory is unavailable for conversion during transit. This results into costs for organization d. Administration costs: money spent on administration

Transportation is accomplished in three ways a.

One’s own fleet – private carriage

b.

Contract with specialists on long term basis – contract carriage

c.

Contract on individual shipment basis – common carriage

Expectations from transportation service are

a.

Minimum cost – transportation costs are explained earlier

b.

Speed: speed of transport means the speed with which goods reach the destination.

c.

Consistency: consistency in speed is achieving the same speed over a long period of time.

Consistency reflects on the reliability of carrier. Any unexpected variance can play havoc with logistics. Modern information technology has made continuous tracking of consignments possible. This takes the element of surprise out. IT has helped logistics managers to seek out

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A study on Domestic Transportation in India at Expeditor’s ways and means to improve speed and consistency. What is becoming important is a combination of speed and consistency.

Requirement of speed depends on type of industry. In some situations speed may not be important. Then transportation service offering high speed increases cost. So logistics managers have to strike a balance between service and cost. Three important aspects of transportation are facility location, transportation cost and consistency.

Design of logistics system should consider total costs rather than elemental cost of transportation 4.

Warehousing Warehousing is holding material before dispatch after it is produced. Although warehousing is conventionally considered to be a storage facility, it plays a much higher role from logistics viewpoint. It is perceived to be a switching facility rather than a storage facility. Warehouse ownership can be private, public or third party contract. Warehouse provides economic and service benefits to the logistical system.

Economic

benefits

are

Movement

Consolidation,

Break-bulk,

Cross-dock,

Processing/Postponement & stock piling.

Service benefits are spot stocking, assortment, mixing & production support 5. Material handling Material handling covers receiving, moving, storing, dispatching activities. It has an impact on cost [capital as well as running], quality and safety. One of the principles of material handling is minimum movement. Commonly used material handling equipment are forklifts, EOT Cranes, hoists, pulley blocks, trolleys, railroad cars, Conveyors, ropes and slings etc.

6. Packaging Packaging is done to make handling and transporting cost effective. It protects the product in transit and handling. Packing is expected to facilitate lifting and moving by providing easy access to forks or hooks. Packing is also expected to display universal symbols and other instructions for handling.E.g. Pallets and containers, wooden boxes, wrapping etc.

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A study on Domestic Transportation in India at Expeditor’s Future prospects Despite problems, The Indian logistics industry is growing at 20% vis-à-vis the average world logistics industry growth of 10%. Since the organized sector accounts for merely 1% of the annual logistics cost, there is immense potential for growth of the sector. The major opportunities are highlighted below.

•

Many large Indian corporate such as Tata and Reliance Industries have been attracted by the potential of this sector and have established logistics divisions. They started providing in-house logistics services, and soon sensing the growth of the market, have started providing services to other corporate as well.

•

Large express cargo and courier companies such as Transport Corporation of India (TCI) and Blue Dart have also started logistics operations. These companies enjoy the advantage of already having a large asset base and an all-India distribution network.

Some large distributors have also forayed into the logistics business for their clients.

•

Since logistics service can be provided without assets, there is growing interest among entrepreneurs to venture into this business.

•

Indian shippers are gradually becoming more aware of the benefits of logistics outsourcing. They are now realizing that customer service and delivery performance are equally important as cost to remain competitive in this global economy.

•

The Indian economy is growing at over 9% for the last couple of years (compared to the world GDP growth rate of 3%), which implies more outputs and more demand for specialized logistics services.

•

The Indian government has focused on infrastructure development. Examples include the golden quadrilateral project, east-west and north-south corridors (connecting four major metros), Free Trade and Warehousing Zones (FTWZ) in line with Special Economic Zones (SEZ) with 100% Foreign Direct Investment (FDI) limit and public-private partnerships (PPP) in infrastructure development. It is expected that infrastructure development would boost investments in the logistics sector.

•

In India, 100% FDI is allowed in logistics whereas in China, until recently, foreign investment was not allowed in domestic logistics. Almost all large global logistics

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A study on Domestic Transportation in India at Expeditor’s companies have their presence in India, mainly involved in freight forwarding. For domestic transportation and warehousing, they have tie-ups with Indian companies. As the Indian logistics scenario looks promising, these MNCs are expected to play a bigger role, probably forming wholly-owned subsidiaries or taking the acquisition route. The latter may be the preferred route of investment since the target company is readily acquired with its asset base and distribution network, and the need for building everything from scratch can thus be avoided. The benefits for the acquired company include the patronage of an MNC and access to the MNC’s global network. As an

Example, DHL Danzas, the biggest logistics company in the world, has taken over Blue Dart.

Managerial Implications Studies on logistics indicate that in this highly competitive and high-cost, low-margin business, logistics managers have to not only focus on differentiating the services rendered by their companies, but market the differentiating factors of their services appropriately to the clients.

They also need to make their cost structures transparent, and convince clients to foot the bill towards investments in quality assets and new technologies such as RFID and GPS (Global Positioning System) leading to improved, and differentiated, delivery of service. Since clients usually prefer a single-point solution to all their logistical problems, managers need to broaden the range of their service offerings, internationalize operations and cover as many industry verticals as possible. They may focus on key customer accounts gradually moving away from accounts generating low, even negative, profitability. However, small-to-medium-sized companies that seem to have high growth potential should not be ignored in the process. In order to become a single point of contact for clients, logistics companies may pursue acquisitions or alliances, which, however, pose the challenge of integration of diverse cultures. Attracting, recruiting, training, motivating and retaining management talent are also a great challenge that logistics managers need to take on (Lieb and Butner, 2007).

A survey of North American LSPs (Bagchi and Mitra, 2006) found that logistics managers perceived internationalization of operations, industry focus or specialization, investment in Babasabpatilfreepptmba.com

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A study on Domestic Transportation in India at Expeditor’s information systems, availability of skilled logistics professionals, integration of supply chains, customer focus and breadth of service offerings as the most important factors for success as a LSP. However, the survey identified significant gaps between expectations and actual achievements of LSPs with respect to internationalization of operations, skilled logistics professionals and integration of supply chains, which should be seriously looked into by managers. The survey also established relationships among a set of performance metrics and key success factors to identify significant predictor and criterion variables. One of the most important observations was that collaborative relationships with clients and investments in assets are

necessary but not sufficient conditions for success in logistics. The findings of the survey may provide a useful guideline to logistics managers for allocation of scarce resources.

As far as the Indian logistics industry is concerned, logistics managers of user firms need to realize that, with supply chains getting more and more complex, outsourcing part or all of their logistical activities to experienced LSPs will help reduce their overheads, streamline supply chains, reduce costs and improve service delivery. The organizational interests should be put above vested interests, if any. They need to realize that organized LSPs are professionals, who will maintain confidentiality of sensitive client information.

The Indian government should also focus on developing infrastructure and encourage publicprivate partnerships in investments in infrastructure. Highway projects such as golden quadrilateral and east-west, north-south corridors connecting all four metros are already underway. Private investments in inland containerized transportation by railroad, which was a monopoly of Container Corporation of India Limited (CONCOR), a subsidiary of Indian Railways, until recently, have been allowed. 100% FDI is also allowed in Free Trade and Warehousing Zones (FTWZ) to create necessary trade-related infrastructure to facilitate import and export of goods and services. The government may create logistics SEZs (Special Economic Zones) or logistics hubs with concessions in land and tax rates. Incentive schemes may also be extended for construction of modern automated warehouses and cold chains. Access to cheap capital should be made available to LSPs for investments in infrastructure, enabling them to extend longer credit periods to their clients and supplementing their working capital. The Babasabpatilfreepptmba.com

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A study on Domestic Transportation in India at Expeditor’s government may create a uniform tax structure and do away with multiple check points and documentation requirements, which would lead to speedier delivery of cargo. To generate awareness, the government may organize seminars, workshops, exhibitions and meetings to bring in representatives of logistics users, service providers and government under one roof, and also sponsor courses in leading Indian institutes to attract talent. Growth of the logistics industry in India will not only contribute to the GDP, but also generate employment (Mitra, 2006).

Road freight industry: The industry is highly fragmented and largely unorganized. The unorganized sector accounts for nearly 80% of the market share. However, changing policies with regards to tax structure are likely to give a competitive edge to the organized sector. Road transport comprises of freight and passenger traffic. It accounts for over 60% of goods traffic and over 80% of passenger traffic.

Railways sector: Indian Railways has one of the largest and busiest rail networks in the world, transporting over 18 million passengers and more than 2 million tonnes of freight daily. It is the world's largest commercial or utility employer, with more than 1.4 million employees. The railways traverse the length and breadth of the country, covering 6,909 stations over a total route length of more than 63,327 kilometers (39,350 mi). As to rolling stock, IR owns over 200,000 (freight) wagons, 50,000 coaches and 8,000 locomotives. IR carries a huge variety of goods ranging from mineral ores, fertilizers and petrochemicals, agricultural produce, iron & steel, multimodal traffic and others. Ports and major urban areas have their own dedicated freight lines and yards. Indian Railways makes 70% of its revenues and most of its profits from the freight sector, and uses these profits to cross-subsidies the loss-making passenger sector. However, competition from trucks which offer cheaper rates has seen a decrease in freight traffic in recent years. Since the 1990s, Indian Railways has switched from small consignments to larger container movement which has helped speed up its operations. Most of its freight earnings come from such rakes carrying bulk goods such as coal, cement, food grains and iron ore.

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A study on Domestic Transportation in India at Expeditor’s

Water Transportation Water transport can be broadly divided into two groups - Inland water transport and Shipping.

Shipping, in turn, can again be divided into two categories Coastal shipping and Overseas shipping.

Inland Water Transportation: Inland water transport includes natural modes as navigable rivers and artificial modes such as canals. The Inland waterways have played an important role in the Indian transport system since ancient times. However, in recent times the importance of this mode of transport has declined considerably with the expansion of road and rail transport. In addition, diversion of river water for irrigation has also reduced the importance of inland water transport. The decline is also due to deforestation of hill ranges leading to erosion, accumulation of silt in rivers and failure to modernize the fleet to suit local conditions. The transportation of goods in an organized form is confined to West Bengal, Assam, parts of North Eastern region and Goa. Development of inland water transport commenced from the Second Five Year Plan and up to the end of Fifth Plan the total expenditure on this sector was Rs. 34 crores. It was only in the Sixth Plan that this sector was given priority and specific schemes of inter-State and national importance for development of inland water transport were taken up. The Seventh Plan was an important landmark in the development of inland water transport. The expenditure on this sector in the Plan (at Rs. 131.85 crores) was more than the expenditure incurred right up to the end of the Sixth Plan. Three objectives were laid down in the Seventh

Plan

for

the

development

of

inland

water

transport

Development of inland water transport in the regions where it enjoys natural advantage.

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A study on Domestic Transportation in India at Expeditor’s Modernizations

of vessels and country crafts to suit local conditions- and

Improvement in the productivity of assets. The Inland Waterway Authority has been set up which is a big step forward and should help in the accelerated development of inland water transport.

Coastal Shipping: India has a long coastline of 7,516.6 kms, a number of ports (11 major and 139 minor working ports) and a vast hinterland. Therefore coastal shipping holds a great promise more so because it is the most energy efficient and cheapest mode of transport for carriage of bulky goods like iron and steel, iron ore, coal, timber, etc. over long distances. However, despite this fact (and despite the fact that coastal shipping was reserved exclusively for Indian ships after Independence), there has been a sharp decline in coastal shipping operations. For instance, the number of ships fell from 97 in 1961 to only 56 in 1980 while Gross Registered Tonnage (GRT) fell from 3.1 lakhs to 2.5 lakhs over the same period.

However, at the end of 1994 the fleet strength was 438 vessels of 6.3 million GRT. The main factors affecting the growth of coastal shipping adversely have been “High transportation costs especially for movement other than those between a pair of water front locations, port delays, poor turnaround time of coastal ships on account of overaged vessels, lack of mechanical handling, facilities etc.” The coastal fleet is ageing fast; about 52 per cent of the tonnage is already overdue for replacement. Also, there is imbalance in coastal traffic movement as traffic is not equally available in both directions. This makes it necessary for coastal ships to sail in ballast, at times, on return journey. Moreover, slow handling of the cargo at port and undue port delays inflict heavy losses on shipping, companies. It is estimated that at present 70 per cent of ship time is spent at ports and only 30 per cent on voyage.

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A study on Domestic Transportation in India at Expeditor’s

Overseas Shipping: Because of the importance of overseas shipping in international trade, considerable attention has been paid to increase the shipping tonnage in the planning period. As a result, the share of Indian shipping in the transportation of India's overseas trade has slowly and consistently increased in the planning period. From around 5 per cent in the first Plan, it increased to around 34.0 per cent at the end of 1993-94. as compared to 1.92 lakh GRT (Gross Registered

Tonnage) at the time of Independence, shipping tonnage increased to 6.30 lakhs GRT in 1994.

In the First Plan Rs. 18.7 crores were spent on shipping while the expenditure in Second Plan stood at Rs. 52.7 crores. An important step taken during the Second Plan was the establishment of a non-lapsing shipping development fund for grant of loans to shipping companies for the acquisition of tonnage. The Third Plan made a provision of Rs. 55 crores for shipping which rose to Rs. 135 crores in the Fourth Plan. The Sixth Plan envisaged the augmentation of shipping tonnage for meeting increased requirements of India’s foreign trade and also to replace the overaged tonnage especially the coastal vehicles. ‘The outlay in this plan was kept at Rs. 720 crores while actual expenditure was only Rs. 432.94 crores.

The resources constraint had forced the Seventh Plan to keep the outlay at Rs. 693.42 crores and the actual expenditure was only Rs. 670.05 crores. The broad objectives for development of

shipping

in

this

plan

were

kept

as

follows:

Modernization of fleet on the basis of improved ship designed and fuel efficiency in engines.

Replacement

of

over

aged

fleet

on

a

selective

basis.

Drivers fixation of fleet by acquisition of cellular container ships and specialized product carriers.

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A study on Domestic Transportation in India at Expeditor’s

Addition to fleet on a selective basis, keeping in view the long-term objective of achievingself-sufficiency in tanker fleet.

Ports India’s coastline of about 6,000 km is dotted with 11 major, 11 intermediate and 168 minor ports. Nearly 95 per cent of the country’s foreign cargo (by volume) moves by sea and, therefore, ports/and their development assume an important place in policy making.

Development and maintenance of India’s major ports are the responsibility of the Central Government, while Other Ports are in the Concurrent list.

Major Ports: India’s major ports are governed by the Indian ports Act 1908 and the Major Port Trusts Act 1963. The former allow the Statutory to declare any port a major port, define port limit, levy charges etc. while the formation of Port trust Boards and vests the administration control and management

of

major

ports

in

these

Boards.

At the time of independence, India had five major Ports, viz. Mumbai, Calcutta, Vishakhapatnam, Chennai, and Cochin. With the Karachi Port going to Pakistan after Partition, there were four major ports on the western coast. A new port was developed at Kandla, which was declared a major port in 1955. The Marmugao Port, developed by the Portuguese, joined the ranks of major ports in 1964 after the liberation of Goa in 1962. Para deep, on the eastern coast, was declared a major port in 1966. Eight years later, New Mangalore and Tuticoin were added to the list of major ports. The inclusion of the Jawaharlal Nehru Port at Nhava Sheva on the western coast took the number of major ports to Development of port after the independence, the development of major ports was taken up in a planned manner. Mechanization and modernizations of cargo-handling facilities at Ports have been a thrust area in recent years, with emphasis on development of dedicated

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A study on Domestic Transportation in India at Expeditor’s infrastructure. Deepening of ports to receive lager vessels has been another priority area.

Vishakhapatnam and Chennai ports have already been deepened.

Minor and intermediate ports: Minor and intermediate ports fall in the Concurrent list and their administration is the responsibility of the respective coastal states. Their number as well as their categorization into minor or intermediate Ports has varied from time to time, depending upon the volume of cargo and the number of passenger they handle. There were 11 intermediate and 168 minor ports and state wise distribution was: Orissa-2, AndhraPradesh-12, TamilNadu-10,

Pondicherry-1, Andaman and Nicobar-22, Lakshadweep-10, Kerala-13, Karnataka-9, Goa-5, Maharashtra-53,Daman

and

Diu-2

and

Gujarat-40.

Name of the 11 major ports, Calcutta, Haidia, Paradeep, Mumbai, Chennai Cochin, Tuticorin, JNPR, Kandla Vishakhapatnam, New Mangalore and Marmugao.

Aviation Sector India's rapid economic expansion, commerce and the fast growing food processing sector has led to a strong and secular growth in air cargo traffic. Domestic cargo movement of airlines has shot up by about 34 per cent in 2008, while international cargo movement has grown by 15 per cent.

Cargo growth in aviation over the last three years has overtaken the railways and shipping, and is set to grab part of their share of freight traffic, says the Associated Chambers of Commerce and Industry of India (ASSOCHAM), which sponsored the ASSOCHAM-Eco Pulse (AEP) study.

The AEP study on Changing Pattern of Cargo Traffic in India from 2000 to 2008 analyzed three major modes of transportation - aviation, railways and shipping. It found that cargo business in

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A study on Domestic Transportation in India at Expeditor’s

the aviation sector grew by around 19 per cent, against 10.3 per cent and 9.2 per cent in shipping and railways during the last three years.

The burgeoning domestic traffic has reduced the proportion of international airfreight to inland traffic from 200 per cent in 2000 to 164 per cent in 2008, mainly because of the rise of low-cost domestic airlines.

Along with logistic companies and retail majors, domestic airlines are launching dedicated freight aircraft to boost goods traffic within the country.

The government is laying emphasis on the food-processing sector and horticulture, giving rise to and need for greater capacity in low-cost domestic airfreight. Dedicated freight aircraft flying

national and international routes would give a boost to industry, ASSOCHAM President Venugopal Dhoot said.

In spite of a reduction in freight rates, railways goods traffic saw a downward trend. Revenue generated from freight has declined to 8.7 per cent in 2008 from 11 per cent in 2007. The proposed dedicated freight corridor (DFC) is likely to sharply increase railways goods traffic, but the extreme long-term nature of the project gives air cargo the advantage, the report says.

Ports and shipping saw a gradual decline in annual growth rates from 11.3 per cent in 2005-06 to 10.4 per cent in 2006-07 to 9.5 per cent in 2007-08. In contrast, total air cargo traffic has increased from 15.6 per cent in 2005-06 to 21.5 per cent in 2006-07, clocking a compound annual growth rate (CAGR) of 9.5 per cent for the last six years.

International air cargo traffic increased from 9.75 lakh tonnes in 2006-07 to 11.20 lakh tonnes in 2007-08. Domestic air cargo traffic swelled from 14.81 tonnes to 17.99 tonnes in the same period, registering a CAGR of 12 per cent for the past six years, compared to 7.7 per cent for international cargo traffic.

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A study on Domestic Transportation in India at Expeditor’s

The total cargo traffic of all major ports increased from 4.23 lakh tonnes in 2005-06 to 4.64 lakh tonnes in 2007-08, registering a CAGR of 7 per cent. But this lagged behind overall goods traffic, which grew by an average 10.3 per cent during the same period.

Cargo growth in the railways was the lowest of the three, with a CAGR of 6.6 per cent over the last six years. Railways freight traffic has increased from 6.68 lakh tonnes in 2006-07 to 7.26 lakh tonnes in 2007-08, but the growth rate has declined from 10.9 per cent to 8.68 per cent over the same period.

Company profile Expeditors is much more than getting a piece of freight from one point to another. The Council of Logistics Management defines logistics as that part of the supply chain process that plans, implements, and controls the efficient, effective flow and storage of goods, services, and related information from the point of origin to the point of consumption in order to meet customers' requirements.

Our job is to make sure that from raw material to finished goods sitting on the retail shelf, we provide the critical services and information necessary to give our clients a competitive advantage in the management of their supply chains 1979 -- 1 location We register as a single office ocean forwarder in Seattle, Washington as Expeditors International of Washington, Inc. 1981 -- 9 locations

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A study on Domestic Transportation in India at Expeditor’s Expeditors become a global logistics company in July, when Peter J. Rose, James L.K. Wang and Glenn M. Alger join the company and open seven offices around the world. The initial focus is on U.S. inbound freight from the Far East, primarily Taiwan, Singapore, and Hong Kong. Our combination of transportation services and customhouse brokerage quickly makes us one of the largest U.S.-based air freight forwarder of goods from the Far East.

1983 -- 11 locations We expand our U.S. export market by hiring senior export executives to lead branch offices in the U.S. and key foreign markets. We add export capabilities to Chicago, Seattle, New York, San Francisco and Los Angeles Offices, and we open our Atlanta office.

1984 -- 12 locations Expeditors become a public corporation with stock traded over the counter on NASDAQ (symbol: EXPD). During our first year as a public company, we report more than $50 million in gross revenues and $2.1 million in net earnings. We open our Toronto office this year, and we now have 161 employees.

1985 -- 13 locations Our first move into the ocean business with the acquisition of Pac Bridge, a major non-vessel ocean common carrier (NVOCC) and expansion of less than container load (LCL) and full container ocean services. We also open a new office in Boston this year.

1986 -- 16 locations We top $100 million in gross revenues ($108,774,000). We enter the European market by acquiring a small export company and opening our London office.

1987 -- 17 locations Babasabpatilfreepptmba.com

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A study on Domestic Transportation in India at Expeditor’s We open our first office in Malaysia.

1988 -- 24 locations We substantially expand export volume through a series of planned expansion in the Far East, Europe, Australia, and the U.S. Peter J. Rose, one of the founders, assumes the title of President and CEO. 1989 -- 27 locations We complete the development of a computerized air export program.

1990 -- 32 locations Our Brussels office becomes our first in continental Europe. We also open offices in Kuala Lumpur, Jakarta and Cleveland (U.S.).

1991 -- 37 locations Our net earnings top $10 million ($10,196,000). We formalize an internal quality program called EXCEL (Expeditors Commitment to Excellence and Leadership), built on a goal of 100% customer satisfaction 100% of the time.

1992 -- 51 locations The number of worldwide employees tops 1,000 (1,100). We open five offices in Germany and our first Middle East office in Saudi Arabia, bringing our number of offices worldwide to 48.

1993 -- 56 locations

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A study on Domestic Transportation in India at Expeditor’s We establish a new division called Expeditors' Cargo Management Systems (e.cms), an ocean consolidation program with an automated electronic data interface. We open our first office in China and Beijing grants Expeditors a rare class "A" license.

1994 -- 80 locations The number of our employees doubles in two years to 2,000. We open distribution centers in Seattle, Chicago, Los Angeles, Miami, Newark, London, Rotterdam, Brussels, Hong Kong, Taipei, and Singapore.

1995 -- 96 locations This is the first year with more than $500 million in gross revenues ($584,691,000). We enter Central and South America with six offices and 10 agents, and expand in the Middle East.

Expeditor launches a Cargo Insurance division. We also gain a new address, on the internet: http://www.expeditors.com.

1996 -- 114 locations Expeditors name a Director of Quality and formalize its global pursuit of ISO 9002 certification.

A total of 27 offices are ISO 9002-certified as five more offices achieve the accreditation in Asia and Europe. The number of employees tops 3,000 (3,250). We open our first offices in India, Pakistan, and Bangladesh. The class "A" license we hold in Beijing is extended to four more major Chinese trading points, bringing our total offices in China to eight. While its employees are recognized as the best trained in the industry, Expeditors raises its minimum annual training requirement for employees from 30 hours to 52 hours, in recognition of the increasingly sophisticated needs of its customers.

1997 -- 138 locations

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A study on Domestic Transportation in India at Expeditor’s We add more than 1,000 employees in one year, for a total of 4,500. We continue networking offices on the northern and southern borders of the United States. The arrangement of offices on both sides of the U.S. - Mexico border is unique among customs brokers, and this offers unprecedented efficiency and speed in processing customs entries. The four new offices in France will soon be joined by other new locations in Europe, as Expeditors continues to selectively expand its global network.

1998 -- 149 locations ISO 9002 certification is achieved in 38 offices throughout the United States, Canada and Mexico, bringing the total number of Expeditors offices certified in this standard to 65 in 17 countries. Gross revenues top $1 billion for the first time ($1,189,044,000) and the number of employees tops 5,000 (5,300).

1999 -- 163 locations We celebrate our 20th year, continuing our reputation as a full service global logistics provider.

The number of employees grows to 6,480. Expeditors services include Air and Ocean Freight Forwarding, Vendor Consolidation, NVOCC, Customs Clearance, Marine Insurance, Distribution, and other value added global logistics services. Recognition from our customers (Cisco Systems and British Airways Catering name us as Supplier of the Year) helps reinforce the mission at Expeditors.

2000 -- 177 locations This year the number of employees tops 7,000 (7,611), and offices are opened in Phnom Penh and Saigon. Expeditors places emphasis on reducing employee turnover and increasing productivity. Improvements are made on a globally consistent Management Trainee Program and Document Imaging.

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A study on Domestic Transportation in India at Expeditor’s Holding strongly to the belief that you can't buy excellence but have to create and nurture it has resulted in continued success for our company. It was confirmed when Expeditors attained the goal of excellence and was given the "Best Companies to Work For" award by Washington CEO Magazine. But the greatest vote of confidence Expeditors can receive is to have good customers willing to trust Expeditors with their important business.

2001 -- 191 locations This year Expeditors was ranked third by Fortune for America's Most Admired companies in the Freight Delivery industry, and the Journal of Commerce awarded Expeditors with the Best Intermediary award. Forbes named the company to the list of America's top 400 companies. Our employees made all of this possible by servicing our customers, one shipment at a time.

2002 -- 195 locations First year with more than $2 billion in gross revenues ($2,296,903,000). First year with more than $100 million in net earnings ($112,529,000). Number of employees tops 8,000. Named to the NASDAQ 100.

Expeditors views its role in the future of international trade as the preferred global logistics solutions company. The company will continue to satisfy its customers' needs through a responsive, highly-trained work force, integrated information systems and a global network.

2003 -- 206 locations Expeditors continues to thrive in a competitive and challenging industry and world economy.

While other logistics companies fail to control costs and stay afloat, Expeditors continues to grow the number of offices, employees and total revenue, all while staying profitable. Air Cargo Babasabpatilfreepptmba.com

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A study on Domestic Transportation in India at Expeditor’s World ranks the company as the second overall freight forwarder and second in the transAtlantic region. In 2003, Expeditors adds full service offices to San Jose (Costa Rica), Orlando (Florida), Austin (Texas) and Tampa (Florida). Our first year with more than $1 billion in assets ($1,044,078,000).

2004 -- 211 locations A number of milestones mark our 25th year: it's the first year with more than $3 billion in gross revenues ($3,317,499,000); the number of employees tops 9,000 (9,445); and net earnings of $156,126,000. $1,000 invested in Expeditors at the IPO price of $9.00 a unit (share and a warrant) is worth $233,600 on December 31, 2004, (assuming warrant exercise) for a compound annual rate of return of 28%.

2005 -- 226 locations In a year of more mergers among other logistics providers and carriers, Expeditors stays true to its vision of organic growth, with five new locations in Asia, six in Europe, two in Latin America, and one each in North America and the Middle East.

The number of employees worldwide now exceeds 10,000 and total revenues approach four billion ($3.9 billion). Expeditor is noted by Forbes as the Best Managed Transportation Company and receives two Quests for Quality awards by the Logistics Management publication.

The Wall Street Journal lists Expeditors as #1 in their shareholder scorecard for Delivery Services, above both UPS and FedEx. 2006 -- 233 locations

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A study on Domestic Transportation in India at Expeditor’s Meeting key strategic goals in Asia, EMAIR, South Pacific and the Americas, Expeditors focused on delivering a consistent level of customer service and productivity around the world.

Entering onto the Fortune 500 list for the first time with $4.6 billion in revenue, Expeditors also stood out as Fortune's #1 Most Admired Company in its industry.

2007 -- 247 locations Expeditors continued to focus on delivering a consistent level of customer service and productivity around the world. New as a Fortune 500 company with $5.2 billion in revenue, Expeditors stood out as one of Fortune's Most Admired companies in their industry for 2007.

2008 -- 253 locations Good consistent customer service has always been our goal here at Expeditors and 2008 was no different. Expeditors continued to open new offices and made capital expenditures for two beautiful new offices in Hong Kong and Shanghai. Peter Rose was named one of Barron’s top 30 CEOs for 2008 and Business Week ranked Expeditors No. 32 on their Top 50 Best Performing

Companies. 2009 is our 30th anniversary and we look forward to the coming year and to all the surprises it will bring.

Awards 1993 •

Licensed Class "A" Freight Forwarder o

Beijing approved a rare Class "A" license for Expeditors.

Awards 1999 •

Dutch Association of General Cargo Sales Agents o

Received award for reservation integrity, communication, know-how and handling

•

South Africa Logistics Council

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A study on Domestic Transportation in India at Expeditor’s o

Recipient of the annual Logistics achiever award for providing the best integrated logistics service

Awards 2000 •

Kent, Washington Chamber of Commerce o

•

Ranked #1 for the In Pursuit of Excellence award program

Hong Kong Labour Department o

Recipient of the Good People Management Award for outstanding performance in people management

•

Industry Association of Sao Paulo o

•

International Freighting Weekly o

•

Ranked #3 for best international cargo agent based on customer satisfaction

Best International Logistics Company of the Year

U.S. Customs Broker National Permit o

Affords greater flexibility in structuring import operations to allow the conduct of certain customs business that is otherwise restricted.

•

Washington CEO Magazine o

•

Logistics Management & Distribution Report o

•

One of the best places to work in Washington

Chosen as recipient for the Quest for Quality award

Shipping Digest o

One of the most e-capable carriers

Babasabpatilfreepptmba.com

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A study on Domestic Transportation in India at Expeditor’s •

Journal of Commerce o

Leader in International Trade and awarded best intermediary of the year

Awards 2001 •

Forbes o

•

One of Americas top 400 companies

Fortune o

Ranked #3 in the transport industry

Awards 2002 •

Trofeu Fenix of Efficiency Award o

•

The NASDAQ-100 Index o

•

In Brazil awarded third place as best Cargo Agent of the year

Expeditors is added to the NASDAQ 100

Selling Power o

Expeditors awarded #1 Best Service Company to Sell For

Awards 2003 •

Logistics Management & Distribution Report o

•

Chosen as recipient for the Quest for Quality award

Air Cargo World o

o

Named the second overall freight forwarder and second in the trans-atlantic region

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A study on Domestic Transportation in India at Expeditor’s •

Transportes & Negócios o

Portuguese newspaper names Expeditors best in class for both Air and Ocean Freight Forwarding

•

Forbes Platinum List o

Fifth straight year on the best big companies list

Awards 2004 •

Global Logistics & Supply Chain Strategies Magazine o

•

Fortune o

•

Carrier Recognition Award for Global Airfreight for the third year in a row.

Samsung o

•

Awards Expeditors for outstanding service.

Philips o

•

Peter J. Rose, CEO, is named Executive of the Year.

British Airways o

•

Expeditors ranked #1 in the air freight category for the shareholder scorecard.

Puget Sound Business Journal o

•

Ranked #2 Most Admired company in Transportation and Logistics.

Wall Street Journal o

•

Includes Expeditors in its global top 25 third party logistics providers ranking.

Logistics Supplier of the Year Award.

International Rectifier o

Service Provider of the Year Award.

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A study on Domestic Transportation in India at Expeditor’s Awards 2005 •

Forbes o

•

Named Best Managed Transportation Company

Institutional Investor o

Names Peter Rose as one of the top CEOs for the Airfreight & Surface Transportation Industry

•

Logistics Management o

Expeditors receives a Quest for Quality award in both the Freight Forwarders and Third-Party Logistics categories.

•

The Wall Street Journal o

Expeditors ranked #1 in the air freight category for the shareholder scorecard for second straight year.

•

Samsung o

Expeditors China receives the Samsung Best Partner awards for the second year in a row.

Awards 2006 •

Global Logistics and Supply Chain Strategies o

Ranked #9 in the Third Party Logistics Industry

o

Ranked #8 in Global Ocean TEU Volume, #1 in the Asia to US lanes and #2 in the China to US lanes

•

Logistics Management o

Lists Expeditors at #3 company in their 3PL Report, by North American Revenue

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A study on Domestic Transportation in India at Expeditor’s o •

Best Fast Moving Consumer Logistics Service Provider in Thailand

Johnson & Johnson o

Awarded Expeditors, Campinas, Brazil for excellency in innovative logistics services

•

Eaton Corporation o

•

Trofeu Fenix o

•

Ranked #1 in the Transportation and Logistics Category

Visteon o

•

Third place in freight forwarder category, Campinas, Brazil

Fortune's Most Admired Companies

o •

CIESP Award: Best run supply chain, Campinas, Brazil

Named Expeditors as one of the 15 outstanding suppliers

Pfizer o

Awarded Expeditors, Indianapolis, Broker of the Quarter

Awards 2007 •

Global Logistics and Supply Chain Strategies o

Named Top Supply Chain Partner

o

Ranked #9 on the Top 25 Global Third-Party Logistics Providers in their May 2007 Issue

•

Logistics Management

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A study on Domestic Transportation in India at Expeditor’s o

Earned #1 in both Freight Forwarding and Third-Party Logistics categories for the Logistics Management 2007 Quest for Quality Awards

•

Forbes o

•

Eaton Corporation o

•

One of the top ranked companies in the Transportation and Logistics Category

Barron's Online o

•

Recipient of the "Premier Supplier" award

Fortune's Most Admired Companies o

•

Included on the Best Managed Companies List for Transportation Industry

Peter Rose was named to the top 30 Global CEOs list.

British Airways o

Recognized with the annual award for "Best Support to Commercial Planning," Istanbul, Turkey

•

LAN Cargo o

•

Awarded Expeditors, Argentina, as one of their top five freight forwarders

Samsung o

Expeditors, China, received the third party logistics provider "Best Partner Award" for 2007

•

Wal-Mart o

Awarded the Global Air Freight Forwarder of the Year Award

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A study on Domestic Transportation in India at Expeditor’s Awards 2008 •

Transporte & Negocios o

•

Fenix Award of Efficiency o

•

Best Logistic Provider

Covidien o

•

Best Ocean Freight Forwarder

Customs Broker of the Year

Logistics Management o

Quest for Quality Award in both Third Party Logistics and Freight Forwarding categories

•

GE Healthcare o

•

Hewlett Packard o

•

Productivity Award

Outstanding Achievement Award

Samsung o

Best Partner Award

Mission Statement To set the standard for excellence in global logistics through total commitment to quality in people and customer service, with superior financial results.

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A study on Domestic Transportation in India at Expeditor’s Goals To be the recognized industry leader, through total commitment to customer service, by maintaining our uncompromising integrity, in the support and development of our People, Communications and Systems in sustained growth and profitability.

Strategy As a non-asset based company, we are able to give our clients several options for freight management. Our investments are made in people and systems. Through organic growth, not acquisition, we give our clients and employees’ peace of mind knowing their day to day business won't be disrupted by merger pains; our systems integrity is kept intact, not disrupted by companies whose business was founded on a different platform. Our customers are most interested in the quality and consistency of service we provide regardless of the country in which we're doing business.

Culture Appearance •

Professionalism is at the core of our identity.

Attitude •

A passionate, caring and winning attitude is focused on the basics of teamwork.

Confidence •

We must believe to achieve, not only in ourselves, but also in our co-workers.

Curiosity •

Be the type of person who wants to learn more about something.

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A study on Domestic Transportation in India at Expeditor’s Excellence •

Doing not just what's expected, but doing the best that's physically possible.

Integrity •

Fairness, honesty, and dignity.

Pride •

It's the personal commitment we make.

Resolute •

Say what you do and do what you say!

Sense of Humor •

Life's too short not to enjoy the work we do and the people we work with.

Visionary •

A perceptive insight to the changing needs of our clients, vendors and organization.

LITERATURE REVIEW Babasabpatilfreepptmba.com

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A study on Domestic Transportation in India at Expeditor’s

Literature portrays logistics and supply chain practices from a variety of different perspectives with a common goal of ultimately improving performance and competitiveness. Studies show that modern manufacturing practices such as Just-in-Time (Green and Inman, 2005), Quality Management (Flynn and Flynn, 2005) and Information Technology (Dyapur and Patnaik, 2005) affect overall supply chain performance. While there is plenty of published literature that explains or espouses Supply Chain Management (SCM), there is a dearth of empirical studies examining logistics and SCM practices. How widely are these concepts implemented in practice?

What are some of the major issues and concerns?

Galt and Dale (1991) study ten organizations in UK and find that these are working to reduce their supplier base and to improve their communications with the suppliers. Fernie (1995) carries out an international comparison of SCM in the grocery retailing industry He finds significant differences in inventory held in the supply chain by the US and European grocery retailers, which could be explained by difference in degrees of their SCM adoption. Tan and Wisner (2000) compare SCM in the US and Europe. Tan (2002) relates SCM practices and concerns to firm’s performance based on data from US companies. He lists nine important supply chain concerns such as lack of sophisticated ICT infrastructure, insufficient integration due to lack of trust and collaboration among the supply chain stakeholders and thereby lack of supply chain effectiveness and efficiencies. Basnet et. al., (2003) report the current status of SCM in New Zealand, while Sahay et. al., (2003) discuss supply chain strategies and structures in India. These surveys rank the perceived importance of some SCM activities, types of hindrances and management tools on the success of SCM using representative samples, mostly from manufacturing. Quayle (2003) surveys SCM practices in UK industrial SMEs (Small Manufacturing Enterprises) while Kemppainen and Vepsalainen (2003) probe current SCM practices in Finnish industrial supply chains through interviews of managers in six supply chains.

They analyze the change of SCM both in terms of operational practices and organizational capabilities. Chin et. al., (2004) conduct a survey that examines the success factors in developing

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A study on Domestic Transportation in India at Expeditor’s and implementing SCM strategies for Hong Kong manufacturers. Feldmann and Muller (2003) examine the problem of establishing an incentive scheme to furnish reliable and truthful information in supply chains.

Kwan (1999) investigates the use of ICT in SCM in Singaporean electronics and chemical industries and finds that the top barrier to the use of ICT is the lack of education and training. Li et. al., (2006) find that higher levels of SCM practice have a direct, positive impact on firm’s performance leading to enhanced competitive advantage. They note that these practices may be influenced by contextual factors such as the type of industry, firm size, its position in the supply chain, supply chain length and the type of supply chain. Other researchers focus on how conflict and power affect the performance of supply chains (Bradford et. al., 2004, Krajewski et. al., 2005).

Olhager and Selldin (2004) study the supply chain strategies of 128 Swedish firms and conclude that the main objectives for the design of supply chains are resource utilization and cost minimization. They specifically study issues related to the supply chain design, integration, planning and control and ICT tools for managing supply chains. Their findings indicate that the firms are starting to appreciate the importance of the supply chains in which they operate.

Quality is the primary priority for the selection of supply chain partners. In addition, delivery dependability, cost efficiency, volume flexibility and delivery speed are also considered to be important inputs to the supply chain partner selection process. Companies show relatively high awareness of modern supply chain planning and control tools. However, the utilization of such tools is still at a relatively low level. Forecasting is the prime area for collaborative efforts.

However, most firms have a long way to go to take full advantage of the promises of supply chain integration.

Need for the study: Babasabpatilfreepptmba.com

Page 54

A study on Domestic Transportation in India at Expeditor’s To study about the domestic transportation of goods its current status, challenges and requirements.

Objectives of the study:  To study the current status of domestic transportation of goods.  To know the customers problems with transporters and challenges taken to overcome those problems by customers  To know the latest technology used in domestic transportation of goods.

Scope of the study:  The study will help us to know the present status of the Indian logistics.  It helps to know the problems facing by the customers with transporters.  To know the modern technologies used in transportation of goods.

RESEARCH METHODOLOGY Babasabpatilfreepptmba.com

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A study on Domestic Transportation in India at Expeditor’s

Sampling Methodology: •

Sample unit: The area of survey conducted is Bangalore city

•

Sample size: Sample size for this project is 50 customers of manufacturing companies, retail, pharmaceuticals, garments and telecom.

•

Sampling method: I have used Non- probability sampling i.e. Random Sampling.

Research plan: In this research plan of project the study was conducted by the survey method.

1. Taking sample

of 50 customers

of manufacturing

companies,

retail,

pharmaceuticals, garments and telecom by commencing sampling using the research instrument as the questionnaire.

2. Personal interview is considered as the sample plan.

3. For this project area of research is Bangalore City.

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A study on Domestic Transportation in India at Expeditor’s

Data collection method: I have collected the data from the following sources: •

Primary data:  The data collected from the company persons.  Questionnaires

•

Secondary data: 

Customers of manufacturing companies.



Internet

Measuring tool: For preparing this project I have considered questionnaire as measuring tool for collecting the data.

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A study on Domestic Transportation in India at Expeditor’s

DATA ANALYSIS AND INTERPRETATION After the data have been fully prepared and entered into the computer, the tabulation work begins. Reaearcher should just prepare a plan specifying which items of data are to tabulated and whether each item is to be tabulated separately or in combination with other items.

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A study on Domestic Transportation in India at Expeditor’s TABLE # 1 Table showing the types of industries: Sl.No.

Industries

No.of Percentage Manufacture rs

1

Automobile& Engineering Goods

35

70%

2

Consumer Durables

7

14%

3

Retail

5

10%

4

Others

3

6%

50

100

Total GRAPH-1

Graph showing the types of industries:

Industries 80% 60% 40% 20% 0%

Series 1 Automobile& Engineering Goods

Consumer Durables

Retail

Others

Analysis: - From the above table we can analyze that majority of the industries i.e. 70% of them are manufacturers of automobile and engineering goods. Followed by next majority of the industries i.e. 14% of them are consumer durables. 10% of them are retail sector and remaining 6% of them are engaged in other industries like telecom, pharmaceuticals and hi-tech goods.

Inference:-From the above analysis we can infer that majority of the industries are manufacturers of automobiles and engineering goods.

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A study on Domestic Transportation in India at Expeditor’s

TABLE#2 Table showing services required in transportation for manufacturers: Sl.No.

Services

No. of users

Percentage

1

Full truck loads and Part loads

33

66%

2

EXIM container trailers

10

20%

3

Rail

5

10%

4

Others

2

4%

Total

50

100%

GRAPH-2 Graph showing the services required in transportation for manufacturers:

Services 70% 60% 50% 40% 30% 20% 10% 0%

Series 1

Full truck loads EXIM container and Part loads trailers

Rail

Others

Analysis:-From the above table we can analyze that majority of the manufacturers i.e. 66% of them use full truck loads and part loads. 20% of them use EXIM container trailers.10% of them use railways. And remaining 4% of them use others means for transportation.

Inference:-From the above analysis we can infer that majority of manufacturers use full truck load and part load for transportation.

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A study on Domestic Transportation in India at Expeditor’s

TABLE # 3 Table showing Part loads weight for shipment: Sl.No.

Part loads(Kgs)

No. of Users

Percentage

1

<100

0

0%

2

101 to 500

2

4%

3

501 to 1000

10

20%

4

>1000

38

76%

Total

50

100%

GRAPH-3 Graph showing the Part loads weight for shipment:

Part loads(Kgs) 80% 60% 40%

Series 1

20% 0% <100

101 to 500

501 to 1000

>1000

Analysis:- From the above we can analyze that 76% of the customers go for more than 1000kgs, 20% of them go for 501 to 1000kgs and 4% them go for 101 to 500kgs in case of part loads weight for shipment.

Inference:-From the above analysis we can infer that majority of the customers use part loads of more than 1000kgs for shipment.

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A study on Domestic Transportation in India at Expeditorâ&#x20AC;&#x2122;s

TABLE # 4 Table showing the Premium offer, if the service levels were met: Sl.No.

Premium

No. of Respondents

Percentage

1

5%

2

4%

2

10%

0

0%

3

15%

0

0%

4

No

48

96%

Total

50

100%

GRAPH-4 Graph showing the Premium offer, if the service levels were met:

120% 100% 80% 60% 40%

Series 1

20% 0% 5%

Analysis: -

10%

15%

No

From the above table we can analyze that majority of the customers i.e. 96% of

them wonâ&#x20AC;&#x2122;t pay a premium and only 4% of them pay a premium for transportation service.

Inference: - From the above analysis we can conclude that majority of the customers wont pay a premium if the service levels of transporters were met.

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A study on Domestic Transportation in India at Expeditorâ&#x20AC;&#x2122;s

TABLE#5 Table showing problems facing by the customers with present set of transporters: Sl.No.

Problems

No.of Respondents

Percentage

1

Shipment trackers

46

92%

2

Damage/Loss

2

4%

3

POD confirmation

2

4%

4

Others

0

0

Total

50

100%

GRAPH-5 Graph showing the problems facing by the customers with transporters:

Problems 100% 80% 60% 40% 20% 0%

Series 1 Shipment trackers

Damage/Loss

POD confirmation

Others

Analysis:- Form the above table we can analyze that majority of customers ie.92% of them are facing the problem of shipment tracking facility.4% of them are facing damage/loss and remaining 4% of them are facing with POD confirmation.

Inference: - From the above we can conclude that majority of customers are facing the problem of shipment tracking facility in the transporting vehicles

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A study on Domestic Transportation in India at Expeditor’s TABLE#6 Table showing challenges taken by the customers to overcome “damage/loss” of shipment: Sl.No. Reasons No. of Percentage Respondents 1

Improper loading/unloading

16

32%

2

Transportation through open truck

25

50%

3

Bad vehicle condition

6

12%

4

Improper stuffing and lashing

3

6%

Total

50

100%

GRAPH-6 Graph showing challenges taken by customers to overcome damage/loss of shipment:

Reasons 60% 50% 40% 30% 20% 10% 0%

Series 1

Improper Transportation loading/unloading through open truck

Bad vehicle condition

Improper stuffing and lashing

Analysis: - From the above table we can analyze that majority of the respondent’s i.e. 50% of damage/loss is due to transportation through open truck, 32% is due to improper loading/unloading, 12% is due to bad vehicle condition and remaining 6% is due to improper stuffing and lashing Inference: - From the above analysis we can conclude that a majority of damage /loss is due to transportation through open trucks.

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A study on Domestic Transportation in India at Expeditor’s TABLE#7 Table showing the process of deciding on the rates to be paid for the transportation services: Sl.No.

Type of rates

No.of Respondents

Percentage

1

Spot rates

10

20%

2

Rate of contract by RFQ

36

72%

3

Annual rate contract

4

8%

4

Others

0

0%

Total

50

100%

GRAPH-7 Graph showing the process of deciding on the rates to be paid for the transportation services:

Type of rates 80% 60% 40%

Series 1

20% 0% Spot rates

Rate of contract

by RFQ

Annual rate contract

Others

Analysis:- From the above table we can analyze that 72% of the respondent’s go by rate of contract by RFQ,20% of them go by spot rates and remaining 8% of them go by annual rate contract.

Inference: - From the above analysis we can infer that majority of the respondent’s go for rate of contract by RFQ.

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A study on Domestic Transportation in India at Expeditorâ&#x20AC;&#x2122;s TABLE#8 Table showing the mode of transportation: Sl.No.

Mode of transportation

No. of Respondents

Percentage

1

Road

34

68%

2

Rail

12

24%

3

Air

4

8%

4

Sea

0

0%

Total

50

100%

GRAPH-8 Graph showing the mode of transportation:

80% 70% 60% 50% 40% 30%

Series 1

20% 10% 0% Road

Rail

Air

Sea

Analysis:- From the above table we can analyze that majority of the respondentâ&#x20AC;&#x2122;s i.e. 68% of them use road transportation followed by rail i.e. 24% and remaining 8% by air.

Inference: - From the above analysis we can infer that a majority of transportation is by road.

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A study on Domestic Transportation in India at Expeditor’s TABLE # 9 Table showing whether the respondents have any import/export cargo: Sl.No.

Satisfied

No. of Respondents

Percentage

1

Yes

38

76%

2

No

12

24%

Total

50

100%

GRAPH-9 Graph showing whether the respondents have import/export cargo:

Satisfied 80% 70% 60% 50% 40% 30% 20% 10% 0%

Series 1

Yes

No

Analysis:From the above table we can analyze that large majority of the respondent’s i.e. 76% of them have import/export cargo and only 24% of them do not have import/export cargo.

Inference:From the above analysis we can conclude that a large majority of the respondent’s have import/export cargo.

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A study on Domestic Transportation in India at Expeditor’s TABLE#10 Table showing weather if yes what value they see in integrated services of domestic and international leg: Sl.No.

Values

No. of Respondents

Percentage

1

Flow of information

24

48%

2

Single point of credit

2

4%

3

Savings

0

0%

4

Less co-ordination

12

24%

Total

38

76%

GRAPH-10 Graph showing the value seen in integrated services of domestic and international leg:

Values 60% 50% 40% 30% 20% 10% 0%

Series 1

Flow of information

Single point of credit

Savings

Less coordination

Analysis:- From the above table we can analyze that the respondent’s i.e. 48% of them value the flow of information, 24% of the respondents feel that there is less co-ordination between manufacturer and a customer and remaining 4% of them value savings.

Inference:- From the above analysis we can conclude that majority of the respondent’s value flow of information between manufacture and a customer.

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A study on Domestic Transportation in India at Expeditor’s

TABLE#11 Table showing whether the import/export decision on transportation is taken by the “Custom House Agent(CHA)”: Sl.No.

Decision on transportation

No. of Respondents

Percentage

1

Yes

18

36%

2

No

32

64%

Total

50

100%

GRAPH-11 Graph showing weather the import/export decision on transportation is taken by the “CHA”:

Decision on transportation

Yes No

Analysis: - From the above table we can analyze that majority of the respondent’s i.e. 64% of them say that the decision on transportation is not taken by the CHA and 36% of them say that the decision on transportation is taken by CHA. Inference: - From the above analysis we can conclude that majority of the respondent’s say that the decision on transportation is not taken by the Custom House Agent.

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A study on Domestic Transportation in India at Expeditor’s TABLE#12 Table showing whether the customers are satisfied with the transportation services: Sl.No.

Satisfied

No. of Respondents

Percentage

1

Yes

48

96%

2

No

2

4%

Total

50

100%

GRAPH-12 Graph showing whether the customers are satisfied with the transportation services:

Satisfied

Yes No

Analysis: - From the above table we can analyze that majority of the respondent’s i.e. 96% of them are satisfied with their transportation services and only 4% of them are not satisfied with their transportation services.

Inference: - From the above analysis we can conclude that majority of the respondent’s are satisfied with their transportation services.

Babasabpatilfreepptmba.com

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A study on Domestic Transportation in India at Expeditor’s TABLE#13 Table showing how the customers deal with the change in the fuel price: Sl.No. Price Decision No. of Percentage Respondents 1

Pre decided as per the contract

6

12%

2

Mutual consent

22

44%

3

No increase or decrease given

22

44%

4

Others

0

0%

Total

50

100%

GRAPH-13 Graph showing how the customers deal with the change in the fuel price:

Price Decision Pre decided as per the contract Mutual consent No increase or decrease given Others

Analysis: - From the above table we can analyze that majority of the respondent’s i.e. 44% of them go by mutual consent,44% of respondents wont give any extra charges when their is increase or decrease in the price and remaining 6% of them go as per the pre decided contract.

Inference: - From the above analysis we can conclude that majority of the respondent’s go by mutual consent and no extra charges given when increase or decrease in the price.

TABLE#14 Babasabpatilfreepptmba.com

Page 71

A study on Domestic Transportation in India at Expeditor’s Table showing by whom the warehouses or distribution centers are managed: Sl.No. Management No. of Percentage Respondents 1

3rd party

22

44%

2

Self

28

56%

Total

50

100%

GRAPH-14 Graph showing by whom the warehouses or distribution centers are managed:

Management

3rd party Self

Analysis: - From the above table we can analyze that majority of the respondent’s i.e. 56% of the warehouses or distribution centers are managed by self and 44% of them are managed by 3 rd party peoples.

Inference: - From the above analysis we can conclude that majority of the respondent’s say that the warehouses are managed by self.

TABLE#15

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A study on Domestic Transportation in India at Expeditor’s Table showing weather the warehouse or distribution center (dc) and the transportation is managed by the same service provider: Sl.No. Management of No of Percentage DC&Transportation Respondents 1

Yes

2

4%

2

No

48

96%

Total

50

100%

GRAPH-15 Graph showing weather the warehouse or distribution center and transportation is managed by same service provider:

Management of DC&Transportation

Yes No

Analysis:- From the above table we can analyze that majority of the respondent’s i.e. 96% of them say that the warehouse or distribution centers and transportation services are not managed by same service provider and only 4% of them are managed by same service provider.

Inference: - From the above analysis we can conclude that majority of the respondent’s say that the warehouses or distribution centers and transportation services are managed by same service provider.

TABLE#16 Babasabpatilfreepptmba.com

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A study on Domestic Transportation in India at Expeditor’s Table showing whether the goods are insured by customers: Sl.No. Goods insured Percentage 1

Yes

100%

2

No

00%

Total

100%

GRAPH-16 Graph showing whether the goods are insured by customers:

Analysis: - From the above table we can analyze that large majority of the respondent’s i.e.

100% of the goods are insured by customers.

Inference: - From the above analysis we can conclude that 100% majority of the respondent’s say that the goods are insured, without insurance they wont transport.

TABLE#17 Table showing that if the goods are insured then on whose risk: Babasabpatilfreepptmba.com

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A study on Domestic Transportation in India at Expeditorâ&#x20AC;&#x2122;s Sl.No.

Decision on risk

No. of

Percentage

Respondents 1

Its an open policy

22

44%

2

Owners risk

15

30%

3

Carriers risk

13

26%

4

Others

0

0%

Total

50

100%

GRAPH-17 Graph showing that if goods insured then on whose risk:

Analysis:From the above table we can analyze that majority i.e.44% of the customers go for open policy,30% of them on owners risk and remaining 26% of them on carriers risk.

Inference: - From the above analysis we can conclude that majority of the respondentâ&#x20AC;&#x2122;s go for open policy.

FINDINGS Babasabpatilfreepptmba.com

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A study on Domestic Transportation in India at Expeditor’s  Majority of the respondent’s i.e. (70%) of them are manufacturers of automobile and engineering goods.  Majority of the respondent’s i.e. (66%) of them use full truck loads and part loads.  Majority of the respondent’s i.e. (76%) of the customers go for more than 1000kgs of part loads for shipment.  Majority of customers i.e. (92%) of them are facing the problem of shipment tracking facility.  Majority of the customers i.e. (96%) won’t pay a premium if the service levels of transporters were met.  Majority of the respondent’s i.e. (72%) of them go for rate of contract by RFQ. 

Majority of respondent’s i.e. (68%) of damage /loss is due to transportation through open truck.

 Large majority of the respondent’s i.e. (76%) of them have import/export cargo.  Majority of the respondent’s i.e. (48%) of them value flow of information between manufacture and a customer.  Majority of the respondent’s i.e. (64%) of them say that the decision on transportation is not taken by the Custom House Agent.  Majority of the respondent’s i.e. (96%) of them are satisfied with their transportation services.

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A study on Domestic Transportation in India at Expeditor’s  Majority of the respondent’s i.e. (44%) of them go by mutual consent and no extra charges given, when increase or decrease in the price.  Majority of the respondent’s i.e. (56%) of them say that the warehouses are managed by self.  Majority of the respondent’s i.e. (96%) of them say that the warehouses or distribution centers and transportation services are managed by same service provider.  Majority of the respondent’s i.e. (100%) of them say that the goods are insured, without insurance they won’t transport.  Majority of the respondent’s i.e. (44%) of them go for open policy, while deciding on the risk factor.

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A study on Domestic Transportation in India at Expeditor’s

SUGGESTIONS AND RECOMMENDATIONS After the study, it can be interpreted that domestic transportation has to improve in all the aspects of this logistics industry. However as a continues improvement exercise, the following points highlighted may be looked into.

•

Since much of domestic transportation is done through road, the transporters should offer customer-specific transportation and Ready solutions to part load or full truck load transportation. The availability of the right equipment, at the right place and at the right time, is what defines their uniqueness and it results in shorter lead-times and more reliable flow of goods.

•

Timely delivery services with accuracy and reliability in both domestic and cross-border deliveries should be the main task of transporters and persistent effort should be made to make the consignment available on the committed date and time, at a reasonable cost and with due consideration to safety.

•

Custom clearance forms a major part in the Logistics Industry. Customer can avail the latest and the fastest means of clearing their consignments – Export & Import, through customs systemized channels unless otherwise subject to custom rules & regulations.

Hence it will be useful if the decision on transportation is taken by custom house agent (CHA).

•

Since majority of the customers are facing the problem of shipment tracking hence a tracking tool called GPRS system should be adapted to measure, record and transmit parameters like date, time, speed and location to the command centre using the local GSM/GPRS network. The system automatically switches over to SMS wherever GPRS coverage is not available.

•

In India major transportation is through open trucks hence there is increase in damage/loss. So closed trucks like canters and container transportation will be a better alternative.

•

While loading/unloading of goods, proper material handling equipments like fork lift and belt conveyors should be used.

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A study on Domestic Transportation in India at Expeditor’s

CONCLUSION After the study, we can come to a conclusion that, domestic transportation has to improve in all the aspects of Indian logistics industry, the logistics industry can still strengthen its position by looking into the following.

•

Many customers are facing the problem of delivery service because; the transporters are not delivering the goods on time. Hence timely delivery services with accuracy and reliability in both domestic and cross-border deliveries should be the main task of transporters and persistent effort should be made to make the consignment available on the committed date and time, at a reasonable cost and with due consideration to safety.

•

Majority of customers are facing the problem of shipment tracking facility in transporting vehicles so a tracking tool called GPRS system should be adapted to measure, record and transmit parameters like date, time, speed and location to the command centre using the local GSM/GPRS network. The system automatically switches over to SMS wherever GPRS coverage is not available.

•

In India major transportation is through open trucks hence there is increase in damage/loss when the goods exposed to atmosphere. So closed trucks like canters and container transportation will be a better alternative.

•

Many of the goods are damaged due to improper loading/unloading, stuffing and lashing hence proper material handling equipments like fork lift and belt conveyors.

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A study on Domestic Transportation in India at Expeditorâ&#x20AC;&#x2122;s

BIBILIOGRAPHY Reference Books Indian logistics

-

Dr. Raghuraman

Logistics and supply chain management

-

Dr. Paul Harris

Websites: www.expeditors.com www.google.com

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A study on Domestic Transportation in India at Expeditor’s

Questionnaire (Domestic cargo India)

Dear Sir/Madam, Date:

_______________

Company name:

_______________

Person contacted: _______________ Designation:

_______________

Contact number: _______________

1. What are the type of commodities do you deal in? _________________________________________ 2. Which is the industry vertical?

Automobile/telecom/Pharmaceuticals/FMCG/Engineering goods/Consumer tech/Garments/Retail/

durables/Hi-

Others (specify) ________________________

3. What are the type of services do you require in transportation?

• • • • • • • • • •

EXIM container trailers Port to factory/DC and vice versa DC trailers Anywhere to anywhere Full truck loads (FTL) Factory/DC to end customers and vice versa Part loads (LTL) Deferred services Express cargo Time bound Intra city distribution Major cities only Reefer Full truck/Part load Custom built vehicles Specialized handling/cargo By air To major cities By rail To major cities Others: ___________________________

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A study on Domestic Transportation in India at Expeditor’s 4. Incase of part loads, typically how much is the weight for shipment? a)<100kgs;

b)101 to 500kgs;

c)501 to 1000kgs

d)1001kgs

5. Please provide the list of top 5 lanes and shipment volumes ____________________________________

6. What do you except in terms of service levels from a transporter? (wish list) _____________________________________________

7. Would you pay a premium, if these service levels were met? If yes, how much? a)5% b)10% c)15% d)20% e)other:____________________

8. What are the top 3 “Problems” you face with the present set of transporters?

• • • • •

Shipment trackers Security Damage/Loss Mis-routing POD confirmation

• Other:_________________ 9. Do you face any challenges in terms of “damage/loss” of shipments; if yes, Please describe the reasons.

• • • • • •

Improper loading/unloading Improper stuffing Improper lashing Bad vehicle condition Transportation through open truck Others:________________________

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A study on Domestic Transportation in India at Expeditor’s 10. Kindly describe the process of deciding on the rates to be paid for the transportation services • • • •

Spot rates Rate contract by RFQ Annual rate contract Other:______________

11. How much is monthly spend (in INR) on transportation by road, air and rail respectively. _________________________________

12. Do you have any import/export cargo? If yes what value do you see in integrated services of domestic and international leg?

• • • • •

Flow of information Single point of credit Savings Less co-ordination Others

13. In case of imports/exports is the decision on transportation taken by the CHA? Yes/No

14. If yes are you satisfied with their transportation services?

Yes/No 15. How do you deal with the change in the fuel prices?

• • • •

Pre decided as per the contract Mutual consent No increase or decrease given Others:_______________________

16. Do your products need any warehousing or distribution centre in India?If yes, Babasabpatilfreepptmba.com

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A study on Domestic Transportation in India at Expeditor’s Kindly provide the location and the space requirements.

Location:______________ Space(sq ft):____________

17. These warehouses or distribution centers are managed by, • •

3rd party Self

18. Is the warehouse or distribution centre and the transportation managed by the same service provider?

Yes/No

19. If no why not?

Advantage

Disadvantage

_____________

_____________

_____________

_____________

______________

_____________

______________

_____________

20. If yes, why?

Advantage

Disadvantage

_____________

_____________

_____________

_____________

______________

_____________

______________

_____________

21. Who are your top 3 vendors for transportation?

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A study on Domestic Transportation in India at Expeditor’s ______________________ ______________________ _______________________

22. Are the goods insured by you? If yes, • • • •

Its an open policy Owners risk Carriers risk Premium paid:__________%

23. If not insured, then how do you manage the risk? ______________________________ ______________________________ ______________________________ 24. Any suggestions/remarks ______________________________ ______________________________

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