Recommendations to improve cfs warehouse operation at duyen hai transport co., ltd (tasaco)

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Recommendations to improve CFS warehouse operation at Duyen Hai Transport Co., Ltd (TASACO)
PREFACE
I declare that this report is my own unaided work. It has not been
submitted before.
If violated, I am solely responsible for and bear the punishments of the
Institution and University.
Student Name and Signature
Tran Quoc Thang
Name: Tran Quoc Thang Class: GMA02 Page i
Recommendations to improve CFS warehouse operation at Duyen Hai Transport Co., Ltd (TASACO)
ACKNOWLEDGEMENT
Firstly, I would like to express my sincere gratitude to my supervisor Master
DoanTrongHieu for the continuous support my dissertation and related research, for
his patience, motivation, and immense knowledge. His guidance helped me in all
the time of research and writing of this dissertation. I could not have imagined
having a better advisor and mentor for my study.
Name: Tran Quoc Thang Class: GMA02 Page ii
Recommendations to improve CFS warehouse operation at Duyen Hai Transport Co., Ltd (TASACO)
TABLE OF CONTENTS
PREFACE....................................................................................................................i
ACKNOWLEDGEMENT..........................................................................................ii
LIST OF ABBREVIATIONS.....................................................................................v
LIST OF TABLES.....................................................................................................vi
LIST OF FIGURES..................................................................................................vii
INTRODUCTION......................................................................................................1
CHAPTER 1: LITERATURE REVIEW...............................................................4
1.1 Definition and role of CFS....................................................................................4
1.1.1 Definition..................................................................................................4
1.1.2 Role...........................................................................................................5
1.2 The basic operations of CFS.................................................................................6
1.3 Regulation quality inspection of goods in CFS....................................................7
1.4 The principle of loading, unloading goods at the CFS.........................................7
1.5 Establishing Procedures of CFS warehouse.........................................................9
1.6 CFS performance measurement..........................................................................12
CHAPTER 2: SITUATION OF CFS WAREHOUSE OPERATION AT
DUYEN HAI TRANSPORT CO., LTD (TASACO)............................................14
2.1 Overview about Duyen Hai Transport Co., Ltd (TASACO)..............................14
2.2 Processes of operating at CFS warehouse..........................................................18
2.2.1 Process of operating imported goods......................................................18
2.2.2 Process of operating exported goods.......................................................25
2.3 Performance indicators of CFS warehouse at TASACO....................................28
2.3.1 Cargo volume through CFS warehouse..................................................28
2.3.2 CFS capacity...........................................................................................29
2.3.3 Warehouse cargo/port cargo ratio...........................................................30
2.3.4 Warehouse turnaround time....................................................................30
2.3.5 Average volume of goods through CFS warehouse per day...................30
Name: Tran Quoc Thang Class: GMA02 Page iii
Recommendations to improve CFS warehouse operation at Duyen Hai Transport Co., Ltd (TASACO)
CHAPTER 3: RECOMMENDATIONS TO IMPROVE CFS WAREHOUSE
OPERATION AT DUYEN HAI TRANSPORT CO., LTD (TASACO)............31
3.1 Evaluation on the CFS of TASACO...................................................................31
3.1.1 Strengths..................................................................................................31
3.1.2 Weaknesses.............................................................................................32
3.2 Recommendations...............................................................................................34
CONCLUSION.........................................................................................................37
REFERENCES.........................................................................................................39
Name: Tran Quoc Thang Class: GMA02 Page iv
Recommendations to improve CFS warehouse operation at Duyen Hai Transport Co., Ltd (TASACO)
LIST OF ABBREVIATIONS
CFS: Container Freight Station
ICD: Inland Clearance Depot
D/O: Delivery Order
ETA: Estimate Time Arrival
B/L: Bill of Lading
C/O: Certificates of Origin
VAT: Value-Added Tax
CBM: Cubic Meter
WMS: Warehouse Management System
TEU: Twenty-foot Equivalent Units
P/O: Purchase Order
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Recommendations to improve CFS warehouse operation at Duyen Hai Transport Co., Ltd (TASACO)
LIST OF TABLES
Table 1: Infrastructure, facilities and staffs..............................................................15
Table 2: The cargo volumes through CFS warehouse..............................................29
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Recommendations to improve CFS warehouse operation at Duyen Hai Transport Co., Ltd (TASACO)
LIST OF FIGURES
Figure 1: Organizational chart of TASACO.............................................................14
Figure 2: The process of operating imported goods.................................................18
Figure 3: The process of customs clearance.............................................................19
Figure 4: The process of operating exported goods..................................................25
Figure 5: The cargo volumes through CFS warehouse.............................................29
Name: Tran Quoc Thang Class: GMA02 Page vii
Recommendations to improve CFS warehouse operation at Duyen Hai Transport Co., Ltd
(TASACO)
INTRODUCTION
According to the plan and schedule of advanced program, the intership is
considered as a great opportunity for GMA02 students to access the practical
environment in companies as well as enterprises. For most students of us, this intership is a
highly anticipated event. It is important to help bridge the gap between education and hands-
on experience, crucial for all students to acquire increased knowledge, business culture and
hands-on experience. After more than four years of studying, we can compare what we have
learned with practical applications in order to choose as well as orientate what’s good and
consistent with our ability, help us more confidence to step outside to find the job.
Personally, I strong believe that intership is a vital opportunity for us to get out of our house
and university. We meet a number of people and seem to struggle to fit in days in our busy
schedules. This is a reasonable time to build and widen our relationship, improve our
abilities of communication, working independently as well as adaptation in new professional
environment. Furthermore, intership helps us become open-minded and outgoing. The
negative influence of studying at university and college is forming a sedentary and passive
lifestyle that reduces the motivation of students. New environment at company and
enterprise will promote our creativity and thinking. Therefore, the intership expands our
learning through active hands-on experience with the rich resources of the local community.
It increases our knowledge and understanding of a subject and realism to the topic of study.
From my point of view, warehousing and warehouse management are part of a
logistics management system, which is itself a component in supply chain
management. Although viewed by some as simply a place to store goods, it actually
plays an important role regarding to inbound and outbound logistics. Therefore, I
am really fascinated by warehouse and I decide to engage in topic namely process
of operating receiving goods CFS. During one month of field trip, I have had
opportunity to practice in Duyen Hai Transport Co., LTD (TASACO) which is one
of Members company TASA DUYEN HAI functioning mainly in warehouse
services. It must be admitted that I have done my report with amount of challenges
because of my inadequate knowledge but no matter how my result, I do hope that
the intership would be a good time for improving my understanding and practical
experience.
Name: Tran Quoc Thang Class: GMA02 Page 1
Recommendations to improve CFS warehouse operation at Duyen Hai Transport Co., Ltd
(TASACO)
So, in two months of internship, with a wish to study the CFS operation
activities, I have chosen this topic: "Recommendations to improve CFS operation at
Duyen Hai Transport Co., Ltd (TASACO)". This research will give an insight to the
CFS activities at TASACO. And from that, I will give proper solutions to increase
the development of company.
Research Object
This study is conducted to study the CFS warehouse operation at TASACO
and find the possible ways to improve the services CFS of warehouse
Methodology of the research
For study, this dissertation is gathered information from both primary and
secondary sources. From primary source, information is gathered by: visiting CFS
warehouse at TASACO and learn information about the CFS operation; observing
the activities in managing CFS warehouse. From secondary source, information is
found and gathered in documents related to CFS warehouse operation, especially
the exported and imported goods process; dissertations, journals, books related to
CFS warehouse operation, services and activities in CFS warehouse.
Limitation of the research
During the process of studying this topic, there are some limitations and
hindrances in conducting the paper. Firstly, studying and evaluating the CFS
operation of a particular company need an amount of time. Due to the time
limitation, this report is conducted with the urgency. Information is gathered
mostly by the process of observation and studying in the appointed time.
Therefore, it may lack some information. Secondly, there are some problems in
observing the real process of operating CFS warehouse at TASACO. Because
this report is conducted in the busy time of the company, it is not easy to
supervise CFS activities and collect data. Besides, some information about the
company is kept in secret for security.
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Recommendations to improve CFS warehouse operation at Duyen Hai Transport Co., Ltd
(TASACO)
Research Findings
This dissertation provides the understanding of CFS operation, studying the
services and activities at CFS warehouse, especially export and import activities and
giving out some recommendations to improve the CFS warehouse operation.
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Recommendations to improve CFS warehouse operation at Duyen Hai Transport Co., Ltd
(TASACO)
CHAPTER 1: LITERATURE REVIEW
1.1 Definition and role of CFS
1.1.1 Definition
-1According WIKI: Warehouse is the repository containing large amounts
products. Over field of logistics, warehouse where cargo from the manufacturer
before going to the retailer
-According Dictionary of business: Warehouse where facilities have been
designed to serve the receipt and temporary storage of goods, and perform other
tasks related to the goods
- According to Vietnam Customs Rules 2005 following repository types:
+ Bonded warehouses storing goods as follows:
Goods which have been sent through customs procedures for export
Goods imported from foreign countries into sending for export abroad or
imported into Vietnam under the law
+ CFS warehouse is a centralized examination of goods and where you fit
more into export goods and exploitation of large batches of imported goods share a
single transport of multiple shippers
- CFS is a place where containers are stuffed, de-stuffed and aggregation/
segregation of export/import cargo take place. With the growing volume of
international trade, the need for expeditious clearance of goods at the port within the
minimum possible time has been gaining importance. This is more so when the
ports are facing congestion at their premises. Further, for optimal utilization of
existing infrastructure, space, equipment, goods that are landed at ports need to be
evacuated straight away without any loss of time. Accordingly the concept of
Container Freight Stations (CFS) has grown in importance along with the
development and growth of ports.
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Recommendations to improve CFS warehouse operation at Duyen Hai Transport Co., Ltd
(TASACO)
- A CFS is where import/ export goods are kept till completion of their
examination and clearance. The imported goods can be immediately shifted from
the port to CFS which also helps in the reduction of port congestion. All the
activities related to clearance of goods for home consumption, warehousing,
temporary admissions, re-export, temporary storage for onward transit and outright
export and transshipments take place from such stations. Therefore, clearance of
goods from CFS is an important point of consideration for trade in respect of
export/ import Cargo as it is the final Customs contact point.1
1.1.2 Role
- 2Warehousing role and important position for production and circulation, to
serve for continuous production and normal circulation of goods. Warehousing is
the infrastructure of the industry, and services for the economy and contributes to
raising the efficiency of social production
- Operation of good warehouse or no impacts on the socio-economic activities.
Economy grows, the more storage systems to meet the needs of the national
economy
- Actually warehousing is not a natural product, abstract. It is the physical
entity created by man to serve the people. So it has always existed in the value and
use value production In terms of goods, the warehouse many components must be
the product of many goods sectors, should be traded. Therefore storage should be
prioritized for development investment, encouraging economic sectors invest as
planned, come to its organization and operation of an economic-technical branch
right towards economy class
- Helping organizations save transport costs, cost savings in production,
maintain a stable supply, policy support for customer service.
- Helping organizations cope with the changes of the market (due to
seasonality, demand change, competition ...) and overcome differences in space and
time between producers and consumers.
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Recommendations to improve CFS warehouse operation at Duyen Hai Transport Co., Ltd
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- Helping meet the needs of customers with the lowest logistics costs. Support
for the program JIT (Just - In - Time) and providing to customers with products in
sync.
1.2 The basic operations of CFS
Basic warehouse operations is a shift (short distance) and storage… are
divided into four basic groups:
- Receiving: Pickup from the transport system in the warehouse. The carrier
must deliver the goods on schedule in order to improve productivity. Customers are
specialized in receiving areas, be inspected for possible damage damaged baggage
are reflected on the delivery note of the carrier. Warehouse receipts will be made at
this stage.
- Put-away: delivery to specific locations in the warehouse. This period may
conduct some business: product identification (scanning of product barcodes),
locate stores, bringing goods into the storage location. Finally inventory system
must be updated to reflect the receipt of goods and their location in the warehouse
Some rules for loading goods: ordinary goods (most in period) placed near
more goods and vice versa. Goods with a total volume of smaller, smaller size are
ranked near the goods
- Order picking: Selection of specific categories of customer orders. Forward
orders for information worker, optimizing the movement pickup, cargo transport to
the waiting area
- Shipping: Loading goods transport to customers. When the means to receive
goods at delivery, the goods are put up storage facilities and then bring up the
vehicles. The carrier must present valid documents. The last step is to enter data
into the system to reflect exported goods excluding from the inventory list, and have
been delivered to the recipient is valid.
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Recommendations to improve CFS warehouse operation at Duyen Hai Transport Co., Ltd
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1.3 Regulation quality inspection of goods in CFS
3
Business proposals are conducting open cargo in each container, use a metal
measuring or checking visually for metal Adhesive products or not, check the
conformity of the goods quantity, quality cultural and other requirements in
accordance with the request of the importer or not.
After inspecting the goods, must close to its original crates and boxes of
unsatisfactory will be labeled "FAIL", but satisfactory barrels will be labeled PASS.
This was intended to inform the factory knew and treatment measures before the
goods are exported out of Vietnam.
The inspection of goods in CFS before export aims to test the goods to ensure
the quality and quantity of the goods in accordance with the request of the importer,
avoid exports unsatisfactory and are customer returns, it will cause losses for
exporters.
The inspection of goods in CFS is done in a separate area and subject to
inspection and supervision by customs manage CFS warehouse.
However, according to the Customs Department, Circular 128/2013 / TT-BTC
dated 10-9-2013 of the Ministry of Finance regulations on inspection services in
CFS, for exported goods can be effected only service packaging, repacking, sorting
and rearranging the goods, while service quality inspection of exported goods in
CFS have not been specified.
1.4 The principle of loading, unloading goods at the CFS
- Height of stacking goods in stock to suit each type of cargo and its
packaging.
- Do not be stacked higher than the load capacity of the tire bag bottom
package, resulting in piles of spillage.
- In case of necessity to the instructions of the consignor stowage
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Recommendations to improve CFS warehouse operation at Duyen Hai Transport Co., Ltd
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- One can use the multi-storey shelving system for stowage of the goods which
the packaging made of weak materials, blankets as carton boxes...
- For perishable goods, fragile as glass, ceramics must be necessarily put in the
packaging to make sure wood and dunnage
- For a set of small-sized packages into a big event (close to the pallet) to
higher stackable and easy to use motorized equipment. Goods loaded on pallets to
ensure safety, the row height does not exceed 1.5 per pallet pallet length.
- Do not be piled higher at the corner positions of the consignment due to
limited visibility of vehicles and equipment and scan disruptive.
- Goods stowage at CFS should be split into separate plots for each
consignment.
- When stacked into multiple layers, between tiers must have padding.
- The goods which are soiled, they should be classified separately in a region.
It is best to put out in the fields.
- Do not put the heavy package onto the light parcels.
- Never stowage of liquid cargo, wet above the dry cargo (avoid damp).
- Shipments Kong cumbersome, inconvenient when unloading should be at or
near the door space.
- Customers have high value to put in a safe location specified and clearly
marked
- Use the right products at the CFS to create gaps between the pile in order to
ensure ventilation if necessary.
- When ranked by hand, workers are only raised to shoulder height parcels,
only stepped up piles when really necessary.
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Recommendations to improve CFS warehouse operation at Duyen Hai Transport Co., Ltd
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1.5 Establishing Procedures of CFS warehouse
+ 4Conditions established CFS under paragraph 5 of Article 63 of Circular
128/2013 / TT-BTC dated 10/09/2013 of the Ministry of Finance regulations:
- Enterprises with registered business of freight forwarding, transport of goods
export, import, warehousing;
- In areas with exports and imports regularly, convenient transportation,
suitable for transporting goods by container; a customs sub-department managers do
not exceed 20 km
- Ensure that the working conditions for customs authorities as office
buildings, where the examination of goods, where the installation of equipment for
customs inspection, storage of material evidences of violations;
- Warehouse must have a minimum area of 1,000m2, with fences surrounding
area, are equipped with surveillance cameras.
- Goods into and out of the warehouse has to managed by computer systems
and are connected to the monitoring system of the customs authorities.
+ Profile Established LCL collection location (CFS) under paragraph 5 of
Article 64 of Circular 128/2013 / TT-BTC dated 10/09/2013 of the Ministry of
Finance regulations:
- A written request for the establishment of enterprises: 01 original;
- Economic feasibility, construction techniques: submit 01 copy;
- Regulation of operation: 01 original;
- Papers evidencing that lawful land use rights: 01 copy;
- Certificate of business registration with occupations forwarding, transport of
goods import and export and (or) business warehouse: submit 01 copy;
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Recommendations to improve CFS warehouse operation at Duyen Hai Transport Co., Ltd
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+ The order established under paragraph 2 of Article 65 of Circular 128/2013 /
TT-BTC dated 09/10/2013 of the Ministry of Finance regulations:
- Enterprises need to establish locations in writing to request the General
Department of Customs (through the provincial, city), in which specify the expected
contents include: the need to establish, location places are planned to be established,
the area, the condition of infrastructure, engineering, infrastructure...
- Within 05 working days from receipt of the written request of the enterprise,
the provincial, city inspection records, based on operation of the venue has been
established in the province , assess the need and matching requirements
management, private bonded warehouse if they meet the monitoring requirements
of the customs officers, the report recommended the General Department of
Customs.
- Within 05 working days from receipt of the report proposed by the
provincial, city, General Administration of Customs has written replies and specific
guidance to implement the content, if not the same reviews the written reply of the
reason.
- After reaching undertakings with the General Customs Department,
conducting business investment and construction stores and sites meet the filing
conditions stipulated in this Circular to the General Department of Customs.
- Within 10 working days from the date of receipt of its application, the
provincial, city performed: Check the file; survey and inspection of the actual
warehouse; assess the satisfaction of the conditions to establish the location, send a
report and recommendation to the General Department of Customs.
- Within 07 working days from receipt of the report of the provincial, city
founded together records of checkpoints, the General Customs Directorate of the
decision to establish sites or documents the answer if now not meet the conditions
prescribed.
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Recommendations to improve CFS warehouse operation at Duyen Hai Transport Co., Ltd
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+ Customs procedures for goods brought into the retail collection sites (called
CFS - Container Freight Station) under Article 51 of Circular 128/2013 / TT-BTC
dated 10/09/2013 of Ministry Financial regulation:
- Goods brought into CFS include:
Imported goods included in the CFS is unfinished goods customs procedures,
are subject to the supervision and management of the customs authorities.
Goods exported goods included in the CFS was done customs procedures or
registered cargo customs declaration at the customs sub-department outside the gate
but the actual inspection of goods made in the CFS.
- The service is performed in CFS
For export goods: Packing, repacking, sorting and rearranging of goods.
For goods in transit or transshipment be included in the CFS in port to
mergers, joint transplantation closed container or closed melding exporter with
exports of Vietnam.
For imports: Allowed splitting to carrying out import procedures or coupled
with other goods container to export shipments to third countries.
- The time for keeping goods in CFS:
Goods brought into CFS stored up within 90 days of the warehousing.
Beyond this time limit, the customs sub-departments managing CFS require
warehouse owners to do procedures that take the goods out of the CFS or treated as
imported goods are abandoned, lost, confused, overdue customs declaration as
provided for in Article 45 of the Customs Act.
- Customs supervision:
CFS, cargo storage, means of transport, which enters and performs services in
CFS, shall be subject to inspection, regular supervision of the customs authorities.
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Recommendations to improve CFS warehouse operation at Duyen Hai Transport Co., Ltd
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Customs supervision over goods and means of transport brought in the CFS
and monitoring the implementation of the service in the CFS conducted under the
provisions of Article 13, Article 14 of Decree No. 154/2005 / ND CP, Article 18 of
this Circular and the guidance of the General Department of Customs.
- Goods from CFS brought inland has to take customs procedures in
accordance with the respective type.
1.6 CFS performance measurement
Warehouse performance is the state of operating warehouse. And the way of
evaluating the warehouse performance is warehouse performance measurement.
There are several theories to decide the warehouse performance indicators.
The often used factors in evaluating the warehouse operating activities are:
1. Cargo throughput: is the total volume of goods going through warehouse in
a period (usually a year). For CFS warehouse, cargo throughput can be calculated
by total import and export cargo that CFS operators handled in a certain time.
2. Warehouse capacity: is the total volume of goods can be stored in the
warehouse.
3. Warehouse storage rate: is the ratio between the volume of goods through
warehouse and the total volume of goods through port.
∑A
α=
∑B
In which: ∑ A is the volume of goods through warehouse
∑ B is the volume of goods through port.
4. Warehouse turnaround time: is the ratio between total warehouse volume
of goods going through warehouse and the warehouse capacity in a specific time
(usually in one year).
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Recommendations to improve CFS warehouse operation at Duyen Hai Transport Co., Ltd
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∑A
n=
C
In which: ∑ A is the volume of goods through warehouse
C: is the capacity of warehouse
5. Average volume of goods through warehouse per day:
∑A
a=
t
In which:∑ A: is the volume of goods through warehouse
t: is the time warehouse run in a year
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