THE PROCESS OF PREPARATION AND DELIVERY OF SURIMI FOR EXPORT QUY TRÌNH CHUẨN BỊ VÀ GIAO HÀNG XUẤT KHẨU Currently, globalization is an irreversible trend, manifesting that Vietnam is increasingly integrating more deeply into the world economy, openness and integration have always been promoted by our government. International integration, especially international economic integration, is a consistent policy and a central content of the foreign policy and international cooperation of our State in the renovation and development. In that context, the import and export activities of countries are a measure to evaluate the results of the process of international integration and development in the interdependent relationship between countries. Especially export activities, it creates capital for imports to serve the countrys industrialization, contributes to economic restructuring to an outward economy, positively affects job creation, improves peoples lives, ensuring the balance of payments for foreign trade...Therefore, Vietnam has participated in many international organizations (such as WTO, APEC, ASEAN,...) and signed many free trade agreements with countries in the region and the world, and introduced many policies to encourage domestic enterprises to participate in export activities, creating favorable conditions for the integration process. The above situation brings many opportunities but also brings many challenges for export businesses. Against this background, located in the central region with the advantage of abundant seafood resources one of the key export products and an export strength of Vietnam, and taking advantage of favorable conditions from the policy of international integration, Bac Dau company also soon entered the market, actively participating in seafood export activities to countries in the region and around the world. There are many activities that play an important role in foreign trade activities, in which two key jobs in the contract performance process are export preparation and delivery. Over the years, with a wealth of experience in exporting, the Company has achieved certain successes, constantly expanding markets and diversifying products, but also encountered many difficulties and challenges, partly due to shortcomings in the export preparation and delivery process. Completing and improving the efficiency of the2 export preparation and delivery process is one of the Companys top priorities, only when the preparation and delivery is well done can the Company be paid, maintain its reputation with customers, ensure the performance of the contract and improve the position of the Company in the international market. Besides, during my internship at the Company, I realized that the preparation and delivery of export goods are complex activities that require knowledge as well as a high level of expertise in the work and have many issues that need to be studied. The study and analysis to find out the strengths as well as the limitations existing in the Companys process, thereby making some recommendations is necessary for the Company to fulfill its commitments, and at the same time reduce the risks and costs incurred during the contract performance, ensure business performance, actively contribute to the longterm development of the Company. Stemming from the importance and nature of the preparation and delivery of export goods, I decided to choose the topic: The process of preparation and delivery of surimi for export to the Thailand market at Bac Dau Co.,
Research Rationale
As globalization continues to shape the world economy, Vietnam is deepening its integration, with openness and international cooperation being consistently promoted by the government International economic integration is a core aspect of the country's foreign policy, and import and export activities serve as a key metric for evaluating the success of this integration Export activities, in particular, play a crucial role in driving industrialization, economic restructuring, job creation, and improving living standards, while also ensuring a balance of payments for foreign trade To facilitate this process, Vietnam has joined various international organizations, such as the WTO, APEC, and ASEAN, and signed numerous free trade agreements, introducing policies to encourage domestic enterprises to engage in export activities and capitalize on the opportunities presented by international integration.
Located in Vietnam's central region, renowned for its abundant seafood resources, Bac Dau company leverages its strategic position and favorable international integration policies to actively participate in global seafood export activities As a key player in foreign trade, the company recognizes the importance of efficient export preparation and delivery processes, crucial for contract performance and customer satisfaction Despite achieving notable successes and expanding its markets, Bac Dau company has encountered challenges, partly attributed to shortcomings in its export preparation and delivery procedures To address these issues, the company prioritizes enhancing the efficiency of these processes, acknowledging that successful preparation and delivery are essential for timely payment, maintaining a strong reputation, and solidifying its position in the international market.
During my internship at the company, I gained insight into the complexities of preparing and delivering export goods, which demands a high level of expertise and knowledge A thorough analysis of the company's existing process is necessary to identify its strengths and limitations, enabling the development of targeted recommendations to enhance contract fulfillment, mitigate risks and costs, and drive business performance, ultimately contributing to the company's long-term growth and development.
Given the significance and intricacies of preparing and delivering export goods, the topic "The Process of Preparation and Delivery of Surimi for Export to the Thailand Market at Bac Dau Co., Ltd" was chosen for in-depth examination, highlighting the complexities of exporting surimi products to the Thai market.
Research objectives
Subject: "The process of preparation and delivery of surimi for export to Thailand market at Bac Dau Co., Ltd" aims to:
- Study and analyze how the preparation and delivery process is done in practice at the Company;
- Make comments and propose some recommendations related to the preparation and delivery activities at the Company.
Research methodology
The research methods used in the study are data collection method and data analysis method. a Data collection method
Primary data collection at the Company was conducted through direct interviews with import-export staff, focusing on the surimi export process The interviews explored issues at each stage of preparation and delivery, providing insight into the actual process Additionally, direct observation of the process allowed for the identification of existing shortcomings, which informed research and the development of solutions to address these problems.
Secondary data collection played a pivotal role in my internship, where I gathered crucial information from the Company spanning 2020 to 2022 This data encompassed the Company's business operations, export markets, primary export products, and logistics involved in preparing and delivering goods Additionally, I supplemented this data by extracting information from the Company's official website and relevant documents detailing the export preparation and delivery process.
This study employed a multifaceted approach to data analysis, incorporating comparative, statistical, and synthetic methods to assess the Company's business performance over the last three years By comparing and contrasting the collected data, the analysis revealed notable differences in performance across the years, providing valuable insights into the Company's growth trajectory Leveraging these findings, the study synthesized the information to identify key areas for improvement and propose targeted solutions that can drive long-term business development.
Subject and Scope of research
Research subject: The process of preparing and delivering surimi for export to Thailand market at Bac Dau Co., Ltd.
Research period: Studying the Company's surimi preparation and delivery process within the past 3 years, from 2020 to 2022.
Research space: At Bac Dau Co., Ltd., address 11 Van Don street, Tho QuangWard, Son Tra District, Da Nang City, Vietnam.
Research structure
The structure of the internship report consists of introduction, list of tables, list of figures, references, appendixes and 4 main chapters below:
Chapter 2: Overview of Bac Dau Co., Ltd and its business operation
Chapter 3: The process of preparation and delivery of surimi for export at Bac Dau company
Chapter 4: General evaluation and proposal of solutions
THEORETICAL BASIS
Overview of Process
A process is a structured series of interconnected activities that convert inputs into valuable outputs for customers, as defined by Tess Hessing This transformation involves adding value to inputs and delivering outputs to either internal or external customers Essentially, a process is composed of multiple interacting activities, where the output of one process can serve as the input for another, creating a seamless and efficient workflow.
- A process is quite abstract It describes the essentials of purpose, structure, roles and timing, with freedom in execution.
A process can be customized and developed from one or more procedures, outlining specific tasks and responsible individuals By integrating these procedures, a process provides a comprehensive framework, often rendering the standalone procedure obsolete as it becomes an integral part of the process itself.
- Building a process can be supported by tools, symbols, templates, and other means.(Muller, 2021)
1.1.3 The importance of defining the process:
Defining the process is extremely important in finding inefficiencies and uncovering errors by identifying the following factors:
- Helps identify duplicate or identical operations performed at different steps of the process
- Identify unnecessary tasks like approvals, unnecessary transfers, etc.
- Helps identify inefficient sequences of steps that lead to delays and rework.
- Helps to identify unclear responsibilities, leading to delays in decision-making(Hessing, 2021)
Overview of contract performance
1.2.1 Overview of foreign trade contract
1.2.1.1 Definitions of contract for the international sale of goods
An international sales contract is defined by Article 1 of the 1964 Hague Convention on the International Sale of Goods and Tangible Assets as a contract where parties have places of business in different countries, goods are transferred across borders, or an agreement is formed between parties established in different countries through an exchange of wills.
According to Article 27.2 of the 2005 Vietnam Commercial Law, the form of an international sale of goods contract is not strictly limited to a written contract, but can also be in another form of equivalent legal validity, offering flexibility in contractual arrangements.
1.2.1.2 The characteristics of foreign trade contract
- The essence of a contract is a voluntary agreement between the contracting parties.
- The subject of the contract (the seller and the buyer) are traders with business offices located in different countries.
The subject matter of an international contract typically involves goods that cross a national customs border, or a scenario where the offer and acceptance stages occur in different countries Alternatively, such contracts may also pertain to goods that remain within Vietnam's territory but are utilized by international organizations, such as foreign embassies or investment projects.
- The content of the contract includes the rights and obligations arising from the transfer of ownership of the goods from the seller to the buyer in different countries;
- The currency of quote or payment is no longer the domestic currency of a country but a foreign currency for at least one of the Contracting Parties.
- Sources of law governing contracts are diverse and complex Not only national law, but also foreign law, international treaties on trade and international commercial practices.
In the event of disputes arising from a contract, the competent body to settle such disputes is typically a court or a commercial arbitration with the authority to handle disputes related to foreign economic relations, particularly when at least one of the parties involved is a foreign agency.
Export contract performance is a crucial activity that an enterprise must undertake after entering into a contractual agreement with a customer, involving a series of closely linked and consecutive tasks that must be executed in a timely and efficient manner Effective performance of each task serves as the foundation for successful completion of subsequent tasks, ultimately leading to the satisfactory fulfillment of the contract.
- Comply with the mandatory provisions of the law (Customs Law, Tax Law, Labeling, Food Hygiene and Safety, )
- Strictly perform the commitments agreed in the contract
- Having good faith in the performance of the contract
- Strictly comply with regulations and develop relationships with relevant service providers (Banks, carriers, inspection companies, )
Effective execution of a well-structured export contract is crucial for businesses to minimize costs and save time, ultimately enhancing operational efficiency and mitigating potential risks, while also bolstering their reputation in the global market.
When executing an export contract, the implementation process may vary depending on the product, sales agreement, and applicable laws, as well as any issues that arise Typically, the export contract fulfillment process involves several key steps, including those outlined below, which are tailored to the specific requirements of the product, contract, and regulatory framework.
(1) Request the importer to fulfill the payment obligation in advance or open L/C (depending on the contract)
(2) Apply for an export license (if necessary) or carry out the necessary procedures for export (if any).
(5) Hire a means of transport (if needed)
(6) Buy insurance for exported goods (if necessary)
(8) Deliver the goods to the carrier or deliver the goods to the vessel
(10) Complaints and settlement of complaints (if any)
Therefore, preparation and delivery of export goods are two important tasks of export contract performance.
1.2.3 Main clauses in international sale contract
Normally, in an international sale of goods contract, there are four groups of clauses
- The group of clauses describing goods includes:
The commodity clause is a crucial component of a sale contract, as it clearly identifies the object of the transaction, enabling parties to accurately determine the item being traded or exchanged By specifying the commodity, this clause helps prevent misunderstandings and potential disputes that may arise from confusion between different items.
The quality clause is a crucial component of a contract, providing a detailed description of the goods' specifications, dimensions, capacity, and other relevant details This clause serves as the foundation for determining the price of the goods and ensures that the seller delivers products that meet the agreed-upon quality standards By clearly outlining the quality requirements, both parties can avoid potential disputes and misunderstandings, ultimately facilitating a smooth transaction.
When it comes to quantity in traded goods, it's essential to define the unit of measurement to avoid confusion, as various measurement coefficients are used globally To clarify, contracts should specify how the quantity or weight will be expressed Two common methods of recording quantity are employed: exact recording, which provides a precise measurement, and approximate recording, which offers a more flexible estimate.
The Packing and Marking clause outlines the regulations governing packaging requirements, including the type of packaging, packing specifications, and regulations on shipping packaging and consumable packaging Additionally, this clause provides guidelines on marking, encompassing the type of symbol to be used and the method of marking Compliance with these regulations ensures that products are properly packaged and labeled, facilitating smooth transportation and storage.
(5) Origin: This clause regulates the origin of goods in relation to the standards of goods quality, tax calculation and import conditions.
- The group of delivery clauses includes:
(1) Delivery basis: Incoterms 2020 rules on the application of delivery basis terms
(2) Delivery: This clause clearly stipulates the contents related to delivery of goods such as: delivery time, delivery place, delivery method, delivery notice, other regulations on delivery.
(3) Transport: Describe the contents related to transportation such as: carrier, means of transport, transportation fee, loading and unloading fee.
(4) Insurance: Specifying contents related to insurance such as: insurance buyer, type of insurance, value of goods to be insured.
-The group of payment clauses include:
In an international sale of goods contract, the price term is often the most contentious and crucial aspect, with parties typically being cautious and unwilling to make concessions during negotiations As a result, the price clause is meticulously crafted to specify key details, including the currency of the price, pricing methods, unit price, and corresponding delivery basis conditions, ensuring a clear understanding of the transaction's financial terms.
(2) Payment: Clear regulations on payment currency, payment terms and payment method, necessary documents for payment.
-The group of legal clauses includes:
(1) Applicable law: The contract is governed by any law or the contract is not governed by any law.
(2) Complaints: The parties stipulate the complaint order, the rights and obligations of the parties involved and the method of settlement.
(3) Penalty: The parties agree on measures for performance once the contract is not performed (in whole or in part) due to the fault of either party.
(4) Arbitration: It is necessary to specify the person who will arbitrate, the applicable law and the adjudication, and the location of the trial.
Contents of export preparation and delivery activities
1.3.1 Basis for carrying out the preparation and delivery of export goods
- Regulations of domestic and international laws, international trade practices
- Conditions of goods and delivery specified in the international sale of goods contract.
1.3.2 Preparation of goods for export
Preparation of goods for export is a crucial initial step in the export contract implementation process, setting the stage for successful subsequent stages This critical link directly impacts the quantity and quality of exported goods, as well as the delivery schedule and overall efficiency of export contract performance Effective goods preparation is essential for companies to ensure smooth execution of export contracts and achieve desired outcomes.
Preparing goods for export includes the following contents:
● Concentrating the source of goods and creating the source of goods
● Inspection of goods a Concentrating the source of goods and creating the source of goods
Concentration of export goods means concentrating on consignments of sufficient quantity, meeting quality standards, at the right time, and optimizing costs.
The source of export goods is a place that has been and is capable of supplying goods eligible for export.
Establishing a reliable source of export goods involves implementing strategic measures to influence the supply chain, ensuring a consistent and timely supply of goods that meets the demands of exporting enterprises.
The process of concentrating export goods of exporting enterprises:
Manufacturing enterprises directly conduct production and export of its products.
To effectively concentrate export goods, a production plan must be formulated in accordance with the export goods requirements outlined in the sales contract, encompassing the preparation of necessary materials, human resources, and equipment to facilitate production This plan should prioritize meeting the stipulated quantity, quality, and type of goods, as well as adhering to the completion deadline for timely delivery to the buyer.
A package serves as a protective container for goods, shielding them from external environmental factors during transportation and storage, while also playing a crucial role in advertising and guiding consumer purchasing decisions.
Effective packaging involves the strategic use of materials to enclose goods, and to achieve this, it's crucial to understand the specific packaging requirements outlined in the sale contract Mastering the correct packaging type according to the contract is also essential, as it enables the selection of suitable packaging materials that meet the particular needs of the goods being packaged.
When it comes to packaging methods, two common approaches are employed: open packaging and closed packaging, with the latter being the more widely used technique Effective packaging requires careful consideration of the goods being packed, ensuring they are neatly stowed within the package The use of dunnage is also crucial, with the selection of the right lining material and technique essential for maximizing space and ensuring the safe and convenient handling, transportation, and storage of goods.
In international trade, various types of packaging are utilized, including boxes, bales, crates, and bags, which serve as outer packaging, while inner packaging and direct packaging also play crucial roles The materials commonly used for inner packaging include cardboard, canvas, jute cloth, tin foil, oil, and grease, often supplemented with additional materials like shavings, scrap paper, foam plastic, and cotton fabric for lining In recent decades, synthetic substances have gained popularity in packaging, with the use of thin films made from PE, PVC, PP, or PS, offering a more modern approach to packaging materials.
Requirements for export packaging include:
- The packaging must ensure the safety of the goods
- Packaging must be suitable for loading and unloading conditions
- Packaging must conform to the standards, laws, regulations, customs and consumer tastes of the export market as well as the customs of the commodity industry
- Packaging needs to be attractive and attract customers
- Export packaging needs to ensure economic requirements c Marking and labeling
Markers are signs in words, numbers or drawings written on outer packages to inform the details necessary for the delivery, handling or preservation of goods.
A product label serves as a crucial tag or identifier on consumable packaging, providing essential information to help consumers differentiate between similar products and understand how to store, use, or prepare packaged foods As a vital marketing tool, labels play a significant role in selling an item by conveying key details and influencing purchasing decisions.
- Necessary signs for the consignee such as: consignee's name and shipper's name, net weight and gross weight, contract number, shipment number, parcel number.
When organizing the transportation of goods, several key details must be taken into account, including the name of the country and place of destination, as well as the country and place of departure Additionally, a clear transportation itinerary, bill of lading number, and details about the shipping vessel, such as the name of the ship and the number of the trip, are also essential for a smooth and efficient logistics process.
When transporting goods from the production site to the consumption site, clear signs and labels play a crucial role in ensuring their safe handling and preservation These signs provide vital instructions on how to load, unload, and protect the goods during transit, including warnings such as "fragile," "open this side," "avoid rain," and "dangerous goods."
Exported goods inspection is a critical process that verifies the conformity of goods with the stipulated requirements outlined in international commercial contracts, encompassing aspects such as quality, packaging, and quantity to ensure compliance with agreed-upon standards.
The importance of goods inspection:
Implementing the exporter's responsibility in international commercial contracts is crucial to uphold their reputation and foster a positive trading relationship By fulfilling their obligations, exporters can ensure a smooth transaction process, build trust with their partners, and maintain a competitive edge in the global market Effective contract performance not only safeguards the exporter's interests but also contributes to the long-term success of their international trade endeavors.
- Timely prevention of bad consequences leading to defects, exchange of new goods, compensatory delivery, lower prices, etc., reducing the efficiency of export activities.
- Analyze the responsibilities of the parties in the import-export process, ensuring the rights of customers and exporters.
The inspection of goods is carried out at two levels, at the facility and at the border gate.
- At the facility: As a production unit, purchasing station, processing… The inspection at the facility plays the most important and decisive role The test content is usually:
To ensure compliance with contractual quality standards, a rigorous quality check is conducted on all export goods, verifying the conformity of packaging in terms of shape, size, quantity, packaging materials, and accompanying documents, as well as the accuracy of symbols and codes.
Quantity and weight check: quantity and weight of each bag, total quantity and weight.
The inspection at the facility is conducted by the company's product quality department However, the head of the unit is still the main person in charge.
At border gates, goods inspection serves as a re-verification process of the initial inspection results conducted at establishments, often mandated by state regulations or buyer requests stipulated in the sales contract In such cases, independent inspection organizations like Vinacontrol or Food Control are typically involved To facilitate this process, exporters must scrutinize the sales contract and Letter of Credit (L/C) to determine the assessment requirements, select an inspection agency, and submit an application that includes essential details such as the applicant's name and address, goods description, packaging and weight information, destination, and transportation means, as well as the type and number of certificates required.
The inspection agency conducts a thorough examination of the goods based on the application and Letter of Credit (L/C), verifying the quantity, weight, packaging, markings, and quality of the goods This meticulous inspection process culminates in the issuance of certificates, which serve as crucial documents in facilitating payment and resolving potential disputes.
Overall information
Brief Information of the Company:
Name:Bac Dau Co., Ltd
Enterprise code: 0400.444.024, issued by the Department of Planning and Investment of Da Nang city for the 5th time on March 11, 2014
Address:11 Van Don, Tho Quang ward, Son Tra district, Da Nang city
Email:bacdaudn@yahoo.com.vn
Website:www.bacdauseafood.com.vn
2.1.1 The process of formation and development
In 1981, a factory specializing in purchasing and supplying fresh seafood for a few local production and processing factories was established.
In 2003, Nguyen Van Chin invested in seafood processing factories and machinery, spanning 4,000 square meters in Tho Quang Seafood Service Industrial Park, to produce fish cakes and establish Bac Dau Co., Ltd This strategic move enabled Bac Dau to emerge as a leading provider of seafood products, solidifying its position in the industry.
Since its inception with a staff of 50, the company has grown exponentially to a workforce of 500, underscoring its remarkable achievements over the years The expansion of its production scale is evident in the establishment of a dry goods factory, in addition to its existing frozen goods processing factory, and the development of a state-of-the-art Surimi production line in 2011 Notably, a Japanese seafood enterprise invested VND 15 billion in transferring a cutting-edge Surimi production line to Bac Dau Co., Ltd., marking the birth of the new Surimi factory This strategic move, coupled with the company's relentless pursuit of product quality improvement, has paved the way for its successful foray into export markets in Japan, China, Korea, Singapore, Thailand, and beyond, resulting in a significant surge in export turnover in recent years.
Operating in Da Nang for over 15 years, Bac Dau has consistently led the way in providing the freshest seafood options Embodying its "top quality" motto, Bac Dau Seafood sources its products directly from Da Nang fishing port, located just 20 meters away, ensuring unparalleled freshness Upon docking, the company's professional staff meticulously sort the catch to deliver the safest and highest-quality products to customers, a commitment that has earned Bac Dau a loyal and sizable customer base.
With a long history of exporting to discerning markets like Japan and Europe, our quality management system adheres to rigorous standards, including HACCP and HALAL certifications In addition to delivering fresh products daily, we also employ a fast freezing process utilizing Japanese HACCP-compliant equipment to minimize the impact on product quality This process forms small ice crystals in large quantities, effectively preserving the original quality of the product.
2.1.2 Fields of activity a Seafood processing
Established in 1981, the company has evolved into a leading joint stock enterprise in seafood processing, boasting a team of over 1,000 skilled workers and experienced managers Equipped with state-of-the-art machinery and equipment, the company is capable of producing high-quality export products that cater to the most discerning markets With multiple production factories adhering to stringent standards, including European standards DL 34 and DL 20, HALAL certification for Muslim countries, HACCP for Vietnam food safety, and ISO 9001: 2008, the company ensures exceptional quality and compliance.
Bac Dau is a leading supplier of a diverse range of seafood products, catering to both domestic wholesale and retail customers with a consistent focus on freshness The company's unwavering commitment to quality and its established prestige have earned it a large and loyal customer base.
The establishment of the new Surimi factory marked a significant milestone for the Company, as it paved the way for the expansion of its export markets to key Asian countries, including Japan, China, Korea, Singapore, and Thailand, while continually enhancing product quality to meet the growing demands of these markets.
Bac Dau currently serves three main groups of seafood including Surimi and fish cakes, fresh/frozen seafood, dried seafood.
Table 2- 1: Main products of Bac Dau Co., Ltd
Surimi- fish cakes Export Surimi
Shrimp Fish: Mackerel, tuna, white pomfret, black pomfret, pompano, cod, cuckoo, flying fish,
Squid: Octopus, cuttlefish, squid, cuttlefish
Dried catfish Dried beef fish
At BACDAUSEAFOOD, our core business objective is centered on relentless product quality enhancement, achieved through continuous investments in state-of-the-art factories and the training of a skilled workforce We prioritize customer-centric design and quality requirements, ensuring our offerings meet the highest standards This commitment has enabled us to establish and consistently strengthen the BACDAUSEAFOOD brand reputation, both domestically and internationally, solidifying our position as a trusted market leader.
Bac Dau Co., Ltd operates as a non-state limited liability company, comprising two or more members, with a director at the helm overseeing the overall management Reporting directly to the director is the vice director, who supports key decision-making processes The company's organizational structure is further divided into departments, each specializing in distinct functional tasks to ensure efficient operations and clear lines of responsibility.
Business performance of the Company
Figure 2- 1: Bac Dau Organization Structure
Table 2- 2: The business result of Bac Dau Co., Ltd 2020-2022
Despite its relatively small to medium size, the company has maintained stable annual revenue over the years, although its operations have been impacted by the COVID-19 pandemic, particularly given its reliance on export revenue From 2020 to 2022, the company's business activity gradually declined, with a 10% decrease from the previous year, and has yet to fully recover The global economic recession in 2023 and beyond is expected to further exacerbate the company's challenging business situation.
Table 2- 3: Export volume of Bac Dau Co., Ltd 2020-2022
A significant portion of the Company's revenue, approximately 80%, is generated from exports, indicating a substantial reliance on international sales The export portfolio is relatively undiversified, with surimi products, particularly those from Bac Dau, dominating the export output and accounting for 100% of the Company's export revenue.
The company's export data reveals a significant focus on surimi production, with this product accounting for over 90% of exports in 2021 and 2022, while frozen goods comprise less than 10% Despite a decline in export turnover over the past three years, largely due to the COVID-19 pandemic, surimi remains a staple export product, particularly in demand among Asian countries such as Japan and Korea, resulting in relatively stable annual export volumes.
THE PROCESS OF PREPARATION AND DELIVERY OF
Basis for carrying out the preparation and delivery of export goods
The preparation and delivery of export goods are executed in strict adherence to national and international laws, as well as established international trade practices A well-structured contract serves as the primary foundation for the successful preparation and delivery of export goods, with key terms including a detailed description of goods and delivery specifications.
The name of the goods is clearly stated in the contract as “Frozen Minced Fish Meat Surimi (Itoyori) Grade 500/700”
The agreed delivery base term is CIF Lat Krabang, Thailand Incoterms 2020 Packing specification is 10kgs/block/2blocks/carton
Unit price is 2.75 USD/KG
Quality is regulated according to Vietnamese Export Standard
Shipment date: before the end of Mar,2023
Port of Loading is Vietnam Port, VIETNAM
Port of Discharge is Lat Krabang, Thailand
Beneficiary is BAC DAU CO., LTD
The set of documents required in the contract includes:
Full set of Clean on Board B/L
Three originals of Commercial Invoice
Three originals of Packing List
One original of Certificate of Origin form D
One original of Health Certificate and one of Analysis certificate issued byNafiqad
The process of preparing and delivering surimi export of Bac Dau Co., Ltd
(1) Concentrating the source of goods and creating the source of goods
Upon receiving an export order, the initial step for the enterprise involves strategic planning to source raw materials from various suppliers, ensuring a seamless progression to subsequent stages Based on the signed contract, the import-export department calculates the required quantity of fresh fish, adhering to the standard norm of 2.8x 20 tons per 20ft container, to produce the desired surimi for the customer With a specific quantity in place, the purchasing department then establishes contact with local fresh fish suppliers to initiate the procurement process.
Bac Dau Company procures raw materials from two primary sources, with the main source being Tho Quang lock, where purchasing staff collaborate with intermediaries at the fishing port to acquire fresh fish for contractual obligations The proximity of this source, approximately 20 meters from the company, ensures the use of freshly caught seafood, resulting in high-quality products However, the availability of seafood is influenced by factors such as the type and quantity of catch, necessitating multiple sources to meet order requirements The second source comprises fishing ports in neighboring provinces like Quang Ngai and Quang Binh, where ship owners directly transport seafood to the company Diversifying sources enables Bac Dau to mitigate potential shortages at Tho Quang port and ensure timely delivery of raw materials to its factory.
Payment method: Pay in cash at Bac Dau company.
Upon collecting the necessary materials for shipment, the relevant departments will transport them to the factory, where the production process will commence, transforming fresh fish into high-quality surimi products Throughout this period, the Company adheres to stringent regulatory compliance and conducts regular inspections to guarantee the finished products meet the highest standards, ensuring customer satisfaction and minimizing processing errors.
Effective packaging plays a crucial role in preserving and ensuring the safety of exported goods during transportation and storage, ultimately allowing products to reach consumers in perfect condition By protecting goods from damage and deterioration, packaging facilitates convenient and attractive product presentation, thereby enhancing the overall consumer experience.
Bac Dau's commercial surimi is carefully packaged in a 10 kg PE bag to prevent exposure to air and external contaminants, ensuring minimal risk of microbial contamination and dehydration To further safeguard the product, a vacuum machine is utilized to extract air before sealing the surimi blocks in aluminum or stainless steel trays, which are then refrigerated for approximately 150 minutes or until a temperature of -25ºC is reached Following the cooling process, two 10 kg packs are placed into a carton for secure storage at ≤-18ºC prior to export, guaranteeing optimal freshness and quality of the surimi.
Export surimi products typically require minimal and cost-effective marking Once packed into cartons, the company affixes a code on the outer packaging to convey essential information for shipping, handling, and storage Marking requirements vary by market, with the Thai market having relatively simple demands that include basic details such as the date of manufacture, expiry date, exporter, and importer.
Proper preparation of goods is a crucial step in the export process, particularly for sensitive products like seafood, as poor purchasing and packaging of raw materials can directly impact product quality and ultimately damage the company's reputation.
A thorough inspection of goods prior to delivery is a crucial requirement, particularly for exported products, to ensure the highest quality and maintain a company's reputation and customer relationships This critical step impacts both the quality of exported goods and the efficiency of export preparation, involving multiple stages to prevent errors that may affect subsequent stages For seafood-related products like surimi, inspection involves not only a facility inspection conducted by the company's KCS department but also obtaining a biological inspection certificate issued by the National authority.
Agro-Forestry-Fisheries Quality Assurance Department (NAFIQAD) This appears to be a mandatory document for surimi exports in any market.
- Inspection at the facility: KCS department conducts inspection of goods on the following criteria:
Quality inspection: checking whether the goods meet the prescribed quality requirements, the suitability of the packaging in terms of shape, size, material,…
Quantity and weight inspection: quantity and weight of each bag, total quantity and weight are complete according to contract or not.
To obtain an inspection certificate from NAFIQAD, import-export staff must register for shipment inspection by submitting a paper file and providing a sample of the item for testing at a NAFIQAD center Following the assessment of the sample's indicators, a test result sheet will be issued, typically available within 5-7 working days Once the results are released, the import-export department can collect them from NAFIQAD, and if the goods meet the required quality standards, they can proceed with shipping.
Bac Dau's export delivery activities involve a multifaceted process, encompassing a series of tasks performed concurrently or sequentially following preparation The delivery process is executed through a strategic combination of in-house task execution and strategic outsourcing to forwarding companies, ensuring seamless and efficient logistics management.
Normally, the Company will export goods to Thailand under CIF terms and will do the following:
(1) Chartering a ship or hiring a means of transport
The charter party is typically hired by either Bac Dau or the importer, depending on the terms of shipment outlined in the sale contract Notably, a significant majority of the Company's export orders are executed under the C rules, specifically CFR (Cost and Freight) and CIF (Cost, Insurance, and Freight) terms.
When exporting under C rules, the Company assumes responsibility for arranging shipping or transportation, including chartering vessels or hiring a suitable means of transport The logistics of transporting goods from the production facility to the port are handled directly by the Company's import-export team With its established reputation, Bac Dau typically partners with trusted carriers, who provide their own pricing, allowing the Company to select the most suitable option to meet its needs.
When chartering a vessel, Bac Dau typically exports goods under CIF or CFR terms, necessitating the signing of a contract of carriage Due to the complexities involved, chartering requires specialized experience, expertise, and knowledge of the charter market To navigate these intricacies, Bac Dau prefers to entrust freight forwarders, such as Bee Logistics or Today Logistics, to handle the chartering process on their behalf.
The import-export staff of the company initiate communication with the forwarding company to share vital information, including chartering conditions, export shipment details, and specific requirements for transportation such as loading, unloading, and preservation methods Additionally, they discuss and confirm delivery timelines on board, unloading procedures at the port of destination, charter freight rates, and the agreed method of payment, ensuring a smooth and efficient logistics process.
- After receiving the information, the forwarding company will conduct a search for suitable shipping lines and ships to introduce to the company.
Signing a charter party contract is a crucial step, typically initiated by the Company, where a formal agreement is established with a forwarding company As part of this contract, the forwarder assumes the responsibility of notifying the Company of the ship's expected arrival date and time, along with other relevant details, enabling the Company to proactively manage the delivery process.
- Make payment for chartering entrustment: Pay about 1 month after closing the month-end statement.
GENERAL ASSESSMENT AND PROPOSED SOLUTIONS
Evaluation of the preparation and delivery process of Bac Dau company
- Order processing time is fast and timely
- Ensure accuracy and coherence between steps in the process
- Prepare and check goods quickly and thoroughly
- Applying e-commerce in customs declaration (shortening customs clearance time)
- There is not yet an official procedure for export delivery
- There are no clear regulations on supervision of entrusted performance of forwarding companies
Proposed Solutions
Solution 1: Establish a formal process for the Company's delivery operations
Implementing an official delivery process is crucial to maintaining and enhancing a business's market reputation By establishing a structured and systematic approach, activities can unfold in a more organized, transparent, and coordinated manner This streamlined process also enables import-export personnel and relevant departments to efficiently monitor the company's export procedures, ensuring seamless operations and improved accountability.
Solution 2: Set standards in trust performance such as time to complete each step, tracking,proof of task completion, etc that employees can rely on to monitor the progress and accuracy of the forwarder's entrustment implementation
To optimize export contract implementation, the Company relies heavily on forwarding companies for critical stages such as chartering and delivering goods on board Establishing standards to monitor the performance of entrusted contracts enables the Company to effectively oversee operations and mitigate potential risks in a timely manner, thereby enhancing overall export efficiency.
Solution 3: Adding more employees to the import-export department
As an export-driven enterprise with 80% of its revenue generated from international trade, Bac Dau's import-export department is pivotal to the company's operations To optimize efficiency and reduce workload pressure, augmenting the department's personnel enables task segmentation, allowing multiple employees to handle specific stages of the process This strategic approach not only minimizes errors in record-keeping and shipment documentation but also accelerates workflow progress and overall productivity.
Established nearly 20 years ago, Bac Dau Co., Ltd has built a strong brand reputation through its business activities, particularly in seafood export As the company's main revenue generator, export activities play a crucial role in its annual performance, with the preparation and delivery of export goods being key contributors However, this process is not without its challenges, necessitating thorough analysis and objective assessment to identify effective solutions and improve the company's export quality, ultimately enhancing its overall export activities.
The company continually conducts parallel research and adapts its methods and directions in tandem with its export activities to identify the most effective approach This proactive strategy is driven by the collective efforts of the leadership team and all employees, who strive for continuous improvement in their pursuit of excellence.
This report aims to examine the current situation, analyze and evaluate the achieved results and existing limitations of Bac Dau Co., Ltd.'s surimi export preparation and delivery process The proposed solutions outlined in this report are preliminary ideas that require further supplementation and practical testing Due to time and knowledge constraints, this report may contain errors, and constructive feedback and suggestions are welcome to enhance its accuracy and overall quality.
2005 Vietnam Commercial Law (n.d.) Retrieved May 26, 2023, from https://thuvienphapluat.vn/van-ban/Thuong-mai/Luat-Thuong-mai-2005-36- 2005-QH11-2633.aspx
Bac Dau (n.d.) Công ty TNHH Bắc Đẩu Retrieved May 26, 2023, from https://bacdauseafood.com.vn/
Hessing, T (2021, April 16) How to Define a Process Six Sigma Study Guide. https://sixsigmastudyguide.com/how-to-define-a-process/
Kurek, M (2021) Packaging Marking and Labeling In Packaging Materials and
The food processing industry plays a vital role in ensuring the quality and safety of consumable products, including food, pharmaceuticals, and cosmetics According to a study published by John Wiley & Sons, Ltd, this industry adheres to strict processing guidelines to maintain product integrity Meanwhile, in the realm of entrepreneurship, a notable example of success in the food processing sector is the story of a businessman in Đà Nẵng, Vietnam, who transformed his humble beginnings as a fishing net repairman into a thriving seafood enterprise, as reported by Mekoong This remarkable journey showcases the potential for growth and innovation in the industry.
Muller, G (2021) What is a process? Gaudisite.Nl. https://www.gaudisite.nl/WhatIsAProcessPaper.pdf
The United Nations Convention on Contracts for the International Sale of Goods, also known as the Vienna Convention 1980, plays a significant role in regulating international trade transactions According to Nguyen T M.'s research in 2014, this convention provides a framework for countries to adhere to when engaging in cross-border sales of goods Reports and documents from the Import-Export Department and the Finance-Accounting Department of Bac Dau Co., Ltd further emphasize the importance of understanding the intricacies of international trade agreements to navigate the complexities of global commerce effectively.