THE UNIVERSITY OF DANANG UNIVERSITY OF ECONOMICS FACULTY OF INTERNATIONAL BUSINESS BACHELOR’S THESIS TOPIC THE PROCESS OF FREIGHT FORWARDING FOR EXPORT BY SEA TO THE US MARKET AT SUPER CARGO SERVICE D.
THE UNIVERSITY OF DANANG UNIVERSITY OF ECONOMICS FACULTY OF INTERNATIONAL BUSINESS BACHELOR’S THESIS TOPIC:THE PROCESS OF FREIGHT FORWARDING FOR EXPORT BY SEA TO THE US MARKET AT SUPER CARGO SERVICE DANANG JOINT STOCK COMPANY Student Class : : Instructor Da Nang, May 2022 : THE UNIVERSITY OF DANANG UNIVERSITY OF ECONOMICS FACULTY OF INTERNATIONAL BUSINESS BACHELOR’S THESIS TOPIC:THE PROCESS OF FREIGHT FORWARDING FOR EXPORT BY SEA TO THE US MARKET AT SUPER CARGO SERVICE DANANG JOINT STOCK COMPANY Student Class : : Instructor Da Nang, May 2022 : COMMITMENT I assure the topic “The process of freight forwarding for export by sea to the US market at Super Cargo Service DaNang Joint Stock Company ” is an independent research project under the guidance of instructor Ms Dinh Tran Thanh My, MBA Also without any duplication of others The content of the research is the product that I have been trying to research during my study at Danang University of Economics as well as participating in an internship at Super Cargo Service Da Nang The data and results presented in the research are completely honest In addition, under the guidance of the Faculty of International Business, I also used Turitin application to check plagiarism As a result, my research has a similarity to other sources of 3% Please take full responsibility to the faculty and the university if there is a problem DaNang, 26th May 2022 The writer i ACKNOWLEDGEMENTS In order to complete the bachelor thesis, I would like to thank the Board of Director of Super Cargo Service, the lecturers of the Faculty of International Business, Danang University of Economics for giving me the opportunity to learn and study knowledges of Foreign Trade major I would like to say thank you to my instructor Ms Dinh Tran Thanh My, MBA, a lecturer of the Faculty of International Business, who helped me to complete my bachelor’s thesis I would like to express my gratitude to all officers of Super Cargo Service, who helped me for my internship at the company Especially, I would like to thank the leader of sales team at Super Cargo Service, Mrs Do Dieu Hang In the process of implementing this bachelor thesis, in spite of my efforts, I could not avoid mistakes I look forward to receiving your feedbacks to improve this thesis Thank you very much! A student of the Faculty of International Business The University of Danang – University of Economics ii INSTRUCTOR’S COMMENT Da Nang, 05/2022 Instructor iii REVIEW LECTURER’S COMMENT Da Nang, 05/2022 Review lecturer iv TABLE OF CONTENT INTRODUCTION 1 Rationale Research subjects and scopes Objectives of the study Structure of the study CHAPTER THEORICAL FRAMEWORK OF FREIGHT FORWADING SERIVCE FOR EXPORT BY SEA 1.1 Logistics service 1.1.1 Definition of service 1.1.2 The characteristics of service 1.1.3 Definition of logistics service 1.1.4 Definition of service quality 1.1.5 Definition of logistics service quality 1.2 Overview of freight forwarding 1.2.1 The concept of freight forwarding 1.2.2 Role of freight forwarding 1.2.3 Features of freight forwarding 1.3 Participants in the freight forwarding services industry 1.3.1 Forwarder 1.3.1.1 Overview of forwarder 1.3.1.2 Rights and obligations of the forwarder 1.3.1.3 Responsibilities of the forwarder 1.3.2 Customer 1.3.2.1 Overview of customer 1.3.2.2 Rights and obligation of customer 1.3.2.3 Responsibility of customers 10 1.3.3 Shipping line (Carrier) 10 v 1.3.3.1 Overview of shipping line 10 1.3.3.2 Rights and obligations of shipping line 10 1.3.3.3 Responsibility of shipping line 10 1.3.4 Customs department 11 1.3.4.1 Overview of custom department 11 1.3.4.2 Rights and obligations of customs department 11 1.3.4.3 Responsibility of custom department 11 1.4 General process and related documents in freight forwarding for export by sea 12 1.4.1 General process of freight forwarding for export by sea 12 1.4.2 Main documents used in the process of forwarding export goods by sea15 1.4.2.1 Certificate of original (C/O) 15 1.4.2.2 Commercial Invoice 16 1.4.2.3 Packing List 17 1.4.2.4 Bill of Lading 18 1.4.2.5 Customs Declaration form 19 1.5 Logistics service quality assessment 20 1.5.1 Time 20 1.5.2 Dependability 21 1.5.3 Communication 21 1.5.4 Convenience 21 CHAPTER METHODOLOGY 22 2.1 Data collection 22 2.1.1 Definition of data collection 22 2.1.2 The data collecting process 22 2.2 Observational method 22 2.2.1 The definition of observational method 22 2.2.2 Observational technique 23 vi 2.2.3 Observational sheet 23 2.3 Document analysis 24 2.3.1 The definition of document analysis 24 2.3.2 The document analysis process 24 2.4 Semi-structure interview 25 2.4.1 The definition of semi-structure interview 25 2.4.2 The process of semi-structured interview 25 CHAPTER OVERVIEW OF SUPER CARGO SERVICE COMPANY 30 3.1 Introduction about Super Cargo Service company 30 3.1.1 Company formation and development 30 3.1.2 Organizational structure and functions of department 31 3.1.3 Main services of company 33 3.1.3.1 Sea & Air freight forwarding 33 3.1.3.2 Cross-border 34 3.1.3.3 Break bulk & Project cargo handling 34 3.1.3.4 Custom brokerages 35 3.1.3.5 Inland Transportation 35 3.1.3.6 Warehouse & Distribution 35 3.2 Result of business activities 35 3.2.1 Market revenue structure 35 3.2.2 Result of business activities 37 CHAPTER THE PROCESS OF FREIGHT FORWARDING FOR EXPORT BY SEA TO THE US 39 4.1 The process of freight forwarding for export by sea to the US at Super Cargo Service 39 4.1.1 Steps in the process 42 4.1.1.1 Negotiate 42 4.1.1.2 Closing orders 44 vii 4.1.1.3 Contact shipping lines and get booking 46 4.1.1.4 Send booking information to customers and closing time 47 4.1.1.5 Trucking container from yard to warehouse for packing 48 4.1.1.6 Trucking container to the place to collect goods 49 4.1.1.7 Receive Shipping Instruction (SI) from customer and prepare documents 50 4.1.1.8 Send SI to shipping lines, receive Draft Bill of Lading from shipping line 51 4.1.1.9 Customs clearance 52 4.1.1.10 Liquidation 55 4.1.1.11 Do the confirmation of ship registration, deliver the goods to the shipping line 56 4.1.1.12 Send final Bill of Lading, customer confirm House Bill of Lading (HBL) 56 4.1.1.13 Receive invoices from shipping lines, close debit, send invoice to customer after the train departs 57 4.1.1.14 Payment to shipping lines 58 4.1.1.15 Care and after-sales 58 4.2 Evaluating the process of freight forwarding for export by sea to the US 58 4.2.1 Time factor 59 4.2.2 Dependability factor 59 4.2.3 The communication factor 62 4.2.4 The convenience factor 62 CHAPTER SOME RECOMMENDATION TO IMPROVE SERVICE QUALITY IN THE PROCESS OF FREIGHT FORWARDING FOR EXPORT BY SEA TO THE US 65 5.1 Be proactive in taking bookings 65 5.2 Improve staff quality 65 viii 4.2.3 The communication factor Mrs Hang said” In the company, most exchanges are by zalo or face-to-face, but there is still a problem of information exchange between the sales and the documentation department” In the company, customers and employees in the company often communicate via zalo, mobile phone, what's app and email when greeting new customers or need customers to confirm information during the process During the delivery process, employees between departments often exchange face-to-face, mobile phones and zalo during the delivery process, however, when transferring customer information to make documents between sales department and documentation staff is still missing and incorrect information, when the shipper sends information or request for amend or implement in documents to sales, then sales staff send it back to the documentation department, at this time it often happens that the information from sales staff sent to the documentation staff is not full compared to customer information, some necessary information is missing in the process of making documents that sales staff not understand, and when the documentation staff need information about the shipment, the documentation staff must go through sales to get information from customers, this will interrupt the customs declaration process, prolong the time of customs declaration and may be delayed leading to dropping container, resulting in dem/det costs, damaged goods, and additional costs for fixing documents from 500,000 VND to 700,000 VND/1 set of documents 4.2.4 The convenience factor With the development of current technology, it is easy to access, exchange information and meet the needs between customers and SCS company, especially in case customers request When asking for a quote on routes from Vietnam to the US, sales staff will easily quote prices to customers based on the price file updated by the pricing department, but in the company there is only one pricing staff for many sales teams lead to when a customer requests a quote for a shipment that is not included in the price file, it will be difficult to meet and the pricing staff cannot clearly understand the type of goods that the customer needs to export to assist with the sales department If in case the customer wants to increase or decrease the number of containers or the 62 quantity of goods, they only need to contact the shipping line to amend the booking, but in the case of increasing the number of containers or the quantity of goods, it still depends on the shipping line remaining space or not In the process of freight forwarding for export by sea to the US, customers usually not have any special requirements compared to other routes, just need to complete the procedures to export goods from Vietnam to the US Below is a table of the time and cost of the shipping process for exporting goods to the US by sea In conclusion, based on the evaluation, it is possible to see four following main problems that cause time and cost in the process of exporting goods by sea to the US Firstly, booking from the shipping line depends on the headquarters in Saigon because the headquarters in Saigon has registered the FMC license, this is the permission for the forwarder to issue HBL to the US and sign a contract with the company shipping lines to go to the US, so only businesses in Saigon can log in to the shipping company's system and make reservations The second problem is the issue of delivery and receipt of goods information documents, information between customers and the company, information between departments in the company, information in each stage in the delivery process In a complicated freight forwarding process, the handling of delivery documents needs to be accurate and fast If processing is slow and incorrect, it will increase costs such as storage, warehousing, etc , prolong the process, and lost customers The third problem is the high workload in the documentation department, because of the combined documentation and customer service department, the document staff has to both declare customs and update the order status for customers, in addition, they has to both require a confirmation from the customer and submit the SI to the shipping line, because of the high workload, it is possible that the Customs Declaration form is wrong or late submission of the SI to the shipping line will prolong the delivery process, increasing the cost of storage and warehousing , costs of shipping lines fine and affects the company's productivity The fourth problem is the shortage of personnel, in the company there are many sales teams but only one pricing staff, so it is not possible to support many sales departments at the same time in quoting immediately and not understanding each 63 deeply the type of goods of each customer in each sales team makes it difficult to fully satisfy the shipment information for the customer 64 CHAPTER SOME RECOMMENDATION TO IMPROVE SERVICE QUALITY IN THE PROCESS OF FREIGHT FORWARDING FOR EXPORT BY SEA TO THE US Based on the above problems, we can give the following corresponding recommendation: 5.1 Be proactive in taking bookings Currently, the company is very passive in taking bookings, so in order to shorten the time for the freight forwarding for export by sea to the US, the company needs to apply for permission from the headquarters in Saigon to get an account with the shipping lines and appoint a department responsible for booking with similar shipping lines with Saigon in Da Nang Thus, when customers have needs, sales staff will be easier and more proactive in applying for bookings, and when having questions, it is easier to communicate directly with the booking department with shipping lines, which reduces time in the process of freight forwarding for export and at the same time also responds quickly to customers' requirements, which increases the company's productivity and the reputation of the business and customer loyalty 5.2 Improve staff quality Training and assigning staff with experience, high expertise in forwarding, especially all employees must be thoroughly trained in ECUS, EPORT customs declaration to avoid fines due not to declare on time, to understand the procedures for each type of goods, items, and export tax HS codes to be able to make the customs declaration more accurately, more quickly, and to reduce the risks in the process of customs declaration and to avoid yellow and red line, avoid additional costs and shorten the time in the process of freight forwarding for export to the US by sea In addition, there needs to be a combination of support between individuals and departments together to carry out the delivery process in a scientific and accurate way and ensure to meet the needs of customers Currently, it is possible to hire a tutor to train employees remotely via online means, and at the same time, there are compulsory online learning programs, the number of hours of self-study access of employees will 65 be updated and reports automatically sent to team leaders, department heads and is one of the criteria for evaluating each employee's annual performance This helps employees to both have more knowledge and take the initiative in time, increasing productivity and efficiency of employees, helping to increase accuracy, reducing costs in the delivery process and helping to shorten time time in the delivery process In addition, the staff must build a good relationship with the agencies, especially the Customs Branch, the port authority, the office of the Ministry of Industry and Trade to create favorable conditions when doing customs procedures, helping to shorten the time to wait for the approval of customs clearance documents Besides, it is necessary to have a good relationship with the shipping line, when there is a mistake, the shipping company helps to solve the problem to make procedures for exporting a shipment to the US faster and easier 5.3 Build a single standardize process Build a more complete freight forwarding process This enables parts to follow a uniform, efficient, and more productive finishing process It is also easier to allocate the amount of work to avoid conflicts that lead to process interruptions or wrong orders in the process that lead to unnecessary errors, reduce unnecessary costs and shorten the time Specifically, SCS needs to stipulate and further improve the following contents, firstly, the customer's name and code Each customer will have a different code to search and distinguish in the system, The second is complete instructions, and clear packing specifications, moreover, with illustrations for clarity, avoiding the situation of wrong packing causes customers to underestimate SCS's services as well as increases the cost of sorting and arranging goods, inspecting goods and prolonging delivery time Thirdly, build a communication channel to exchange common information between customers and other departments outside sales such as documentation, trucking, and pricing staff to exchange information in the most accurate way related to the technique of each department to reduce errors and avoid unnecessary costs 5.4 Add more personnel Recruiting and arranging more personnel in the pricing department, assigning each sales team to be a pricing staff member so that they can easily support the price when the sales department needs support to quickly respond to the requirements of 66 customers Besides, the pricing staff will have a deeper understanding of the shipment of each type of customer in each team, thereby easily supporting the sales department so that the process of negotiation and delivery of goods takes place quickly and smoothly In addition, it is necessary to separate the documentation and customer service department to reduce workload for department Thus, when the volume of orders is high, the customer service and documentation department will focus on the professional work of each department, thus helping to reduce errors in the delivery process, which helps to increase accuracy in the customs declaration to reduce errors to avoid yellow or red line, which incurs additional costs and takes more time to check documents, check goods and redeclare customs Besides, when separated, the customerservice department can focus on supporting customers, updating the status of goods continuously for customers so that customers can ensure the progress, in addition, after completing the shipment, the customer service department continues to take care of customers to keep their loyalty 67 CONCLUSION The topic "The process of freight forwarding for exports by sea to the US market at Super Cargo Service DaNang Joint Stock Company" has generally solved the concept of logistics service quality, concept and role of forwarding the criteria to evaluate the freight forwarding process related to service quality In addition, the diagramming of the process of freight forwarding for export to the US by sea and going into details of the steps in the process to find out the problems related to service quality From difficulties and problems, we can propose measures to improve service quality in the process of freight forwarding for export to the US by sea, such as being proactive in booking bookings, improve staff quality, build a single standardize process, add more personnel To complete my graduation thesis, I have received enthusiastic help from colleagues in the company in collecting data and documents related to the company I would like to express my sincere thanks to my colleagues Especially, I would like to express my deep gratitude to Ms Dinh Tran Thanh My,MBA who wholeheartedly guided me in writing this graduation thesis 68 REFERENCES VIETNAMESE Nguyễn Hồng Đàm (2003) Vận tải giao nhận ngoại thương ENGLISH Bowen, G A (2009) Document Analysis as a Qualitative Research Method Ciesielska (2018) Qualitative Methodologies in Organization Studies: Volume II: Methods and Possibilities George, T (2022) Semi-Structured Interview | Definition, Guide & Examples Retrieved from https://www.scribbr.com/methodology/semi-structured-interview/ Given (2008) The SAGE encyclopedia of qualitative research methods, Vols & Kabir, S M (2016) Method of data collection In Basic Guidelines for Research: An Introductory Approach for All Disciplines (pp 201-275) Lovelock (2016) Service marketing World Scientific Publishing Co Inc., USA Marshall (2016) Designing qualitative research Murphy, J M (2015) 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https://mof.gov.vn/webcenter/portal/vclvcstc/pages_r/l/chi-tiettin?dDocName=MOFUCM196634 70 APPENDIXES Appendix 1: Booking Receipt Note 71 Appendix 2: Shipping Instruction 72 Appendix 3: Packing List 73 Appendix 4: Draft Bill of Lading 74 Appendix 5: House Bill of Lading 75 Appendix 6: Debit Note 76 ... OVERVIEW OF SUPER CARGO SERVICE COMPANY 3.1 Introduction about Super Cargo Service company Trade name: Super Cargo Service Da Nang Joint Stock Company Transaction name in English: SUPER CARGO SERVICE. .. District, Da Nang City, Vietnam Head office: 3G Pho Quang, Ward 2, Tan Binh, Ho Chi Minh Email: info@supercargoservice com Website: Supercargoservice com Established date: July 16, 2018 Type of business:... sea This is a main service of Super Cargo Service, Super Cargo Service offers international Sea Freight forwarding services, such as: groupage Container (LCL) and FCL-services to and from the major